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Posted: Thursday, 25 July 2019 12:08

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Wine Retail: The Taste that beats the others Cold

July 25: ‘The Taste’ department stores in Defence Colony, New Delhi has been selling wine and beer for around 5 years, without a hint of selling wines but as you enter the store and walk towards the back, you see several bottles with different labels stored vertically and the pleasant face of Jimmy Wadhawan, the beard-sporting partner who has popularised wines enough to be nominated as the Best Retail Store of Delhi NCR at the delWine Excellence Awards, at Pullman in April 21. Subhash Arora had a long chat with him regarding Retail and the challenges and opportunities ahead

PIC By:: Adil Arora

If you pass by The Taste at Defence Colony, you see the facade covered with Rakhis for the traditional Indian festival where the sister ties the rakhi around her brother’s wrist and gives him some gift and he vows to protect her and gives money or some gift in return. The only tell-tale sign that this shop also sells wine is when you venture to enter the shop and go straight to the back where in a corner sits a bearded guy surrounded by several customers and scores of wines with interesting labels displaying Brunello, Barolo, Chateauneuf-du Pape and champagnes, amongst other labels.

Meet Jimmy Wadhawan, partner of The Taste and former cheese specialist before he started dabbling into wines barely 4 -5 years ago and with his gentle demeanour and helpful attitude to his wine customers, he brought the department store to a level that The Taste was nominated in the Best Retailer category at the delWine Excellence Awards held at Pullman Aerocity on April 21. This was based on an extensive survey with the importers, producers and customers.

Selling about 250 cases a month and stocking around 200 labels of imported wines and 90 labels of Indian product, he is not too happy about the wine situation in Delhi but blames both the government and the producers/importers alike and is grateful to the few who have kept the prices reasonable enough to make it buy wines.

He has been experiencing a steady growth in the sales in numbers thanks to his knowledge and ability to read the customer’s mind and the passion to guide them along so that they become and stay as his loyal customers and go by his recommendations.

He deals with every major importer like Aspri, Brindco, VBev, Prestige, Hema etc and all 4 top producers-Sula, Grover, Fratelli and York but promotes from the bouquet what he feels is best for the customer-at least so he says.  The knowledge of wine is still very limited in his customers and the fact that no discount is legally possibly, makes his job easier on most occasions. In lieu of the discounts, he likes to guide people to where they feel satisfied with their purchase.

Indian Wines need to buckle up

One would think that with excise duties going up crazily in Delhi last year with higher registration charges, Indian wines would have had a heyday. Jimmy does not agree with the premise. Actually Indian wines went overboard with increasing their prices and many imported labels have either decreased their prices or several labels have entered with competitive prices. This has made Indian wines quite unattractive.

He reels out several examples. Sula increased its price from Rs. 700 to Rs. 850 in a very clever way. But he takes out a couple of wines from Bordeaux costing Rs. 850 and one Malbec at Ra. 900 and says that customer gets definitely interested in these wines over Sula. ‘Sula introduced The Source Grenache Rose last year at Rs. 850-a great wine at the price (my personal all time favourite- editor). But they increased the price to around Rs. 1200 this year, making it unattractive to the customer. Grover La Reserve is a fine Indian wine at Rs. 1100 (it used to sell for Rs. 440 about 10 years ago and has been steadily going up in price) but at Rs. 1100 Australian Black Label from McGuigan imported by Hema is perceived to be a much better buy by the consumer. Same with Fratelli Sette that is an excellent, strong red wine but costs over Rs. 1800 which not many consumers are willing to pay as there are many decent imported wines cheaper than that. Even Sabore de Edmara from Chile, also imported by Fratelli at Rs. 1210 is more attractive for most customers.  

Retail Trends

As is widely known and unfortunately a fact, the Indian customer has little knowledge of wines. They count heavily on the recommendations of the store and can be thus fooled into buying unknown wines with suspect quality when the Retailer makes more margins in those wines. Jimmy has made this into a winning strategy. ‘I always ask the customer first his budget and the style of wines he has in mind. There is no point in my recommending him a VFM Pinot Noir if he drinks only powerful wines like Cabernet. I like to give him the best possible choices in that range. Once I know his taste, I like him to experience better wines next time he comes. I even try to change his palate by recommending other nicer wines to him. But I always like to start him off at lower price range.’

Advice to other Retailers

It’s important for retailers to increase the variety and quantity, is his advice to other retailers. ‘I know many go for the pitfall of trying to sell more of wines where they get more incentive (quasi-illegal but a normal trade practice that can’t be checked by government) but eventually, they must have a wider choice to offer the customers. In any case there are around 20 labels that offer such incentives.’  It’s a pity that by law such incentives cannot be passed on the customers making retailer keep the hefty margins for himself and are branded as the scourge of the industry by importers and producers alike-and the customers who are in the know of how the system works.

Trading Down

The disturbing factor of economy slowing down is quite visible in his wine sales. We read about car sales going down-so are his deluxe wines like Brunello, Barolo, Amarone and top Bordeaux and Chateauneuf-du Pape. ‘It took us a long time to bring up the taste buds but suddenly it has gone down. People are trading down. The earlier standard of Rs. 1500-2000 as the biggest selling wine category has moved down to Rs. 800-1500 category; so our number of cases are going up but revenues are coming down. People who bought Brunellos costing Rs. 6000-8000 have come down to buying Valdivieso from Chile costing a third. We don’t sell many of those deluxe wines anymore. People can still buy them but they feel they should rather save money for better times,’ he says.

In fact, as a rule of thumb, if they serve to acquaintances, his customers would now open cheaper wines. Only if they serve to someone special, would they offer expensive wines. And the novices go for lower priced wines anyway-preferably imported. They look at the price rather than quality.

In congruence with the importers’ shift of preferences, he has cut down the labels he stocks. We used to have several labels from Brindco-in fact we had several labels of Sutter home from him. Now he sells only White Zinfandel which we sell at Rs, 1460-he has discontinued a major chunk.

Excise Policy 2019-2020

Like everyone else, he is awaiting the policy though it does not affect his daily work. Unlike many who believe that the excise is expected to come down (or at least the ridiculous high registration charges that made prices go up last year by 10-15%), he believes the overall duties would go up. ‘The sales on alcohol have gone down and so is the excise duty collected. Therefore, the government would be obliged to increase the duties’ he says. I do not share this logic because I believe the government has recovered more revenues because of the increase in taxes last fiscal year.

In any case, The Taste has established its branding so much that some importers retail exclusively through him. Wine Park and Phoenix (selling Ward wines from New Zealand, strongly recommended by delWine) are available exclusively through him).

Who knows, the ladies entering The Taste during th next couple of weeks, may end up buying a bottle of nice Italian, French or Chilean wine as a gift for their brother for Rakshabandhan which is being celebrated on August 15 this year.  When he asks you your budget, tell him how much you care for the brother but also how much he knows about wines. But be prepared to shell out a ridiculous Rs. 15,000 for the otherwise fabulous Laurent Perrier Rose Brut champagne. He has plenty of Prosecco at Rs. 2,000 upwards that would be a better value. It’s a time to celebrate after all and requires a celebratory drink!

So Cheers and Jai Ho!

Subhash Arora

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