Bibendum boss predicts cutthroat trading conditions in 2013
The managing director of Bibendum predicts the wine trade will see further casualties throughout 2013 as everyone desperately fights for a larger slice of a pie that is only shrinking.
In 2012 big names like Waverley TBS, Thierry’s and Stratford’s collapse as wine volumes consumed fell across the UK.
When asked if he sees a light at the end of the tunnel of economic gloom, Saunders said: “No. I see no reason why anything is going to change at all.
“These are tough times and I think there will be more casualties.
“It’s absolutely clear there’s going to be a polarisation of winners and losers. Balance sheets have become stretched.
“I am very hopeful and clear that Bibendum is very well positioned.
“But I want to be bigger and better. We have to become an extremely efficient business. If I want to grow it’s going to have to be out of market share – which isn’t going up.”
To achieve this, Saunders is pushing the Taste Test system Bibendum has developed.
By answering three simple, non-wine related questions, customers are allocated a number from 0 to 12 which sits within one of the four profiles: sweet (0-3), fresh (4-6), smooth (7-9), intense (10-12).
The Taste Test is currently licensed exclusively to Morrisons for the grocery sector and will match customers’ flavour profiles against a range of wines online and in-store.
But that runs out this year and Saunders said: “Morrisons has the Taste Test under licence for a period but other retailers large or small can talk to us about ways in which we can help them manage their category.
“It took three years to develop and what we have is unbelievable. We are the only people to have this at our fingertips. We wanted to put some science behind wine retailing.
“Wine prices are going up for two reasons – general harvest issues and fiscal issues.
“We are under attack from the government with the duty escalator, minimum unit pricing and the success of the health lobby saying everyone who drinks alcohol is evil.
“We want to find ways to encourage people to spend money on wine that’s right for them.
“We very much advocate drinking less but better.
“We have to think hard about how to engage people in the wine category.
“We are trying to get people to focus on helping consumers find what wine tastes right for them.”
When OLN reported on the Tatse Test in the past, wine retailers wrote to us outraged at its attempts to pigeonhole the complexities of wine into simple brackets.
But Saunders said: “If you are an anorak it will be too simple for you – no one is going to argue with that.
“But the wine trade is more turbulent than it was last year. We need to make it easier for consumers to find wine they will enjoy.
“There’s a reason there’s so much Pinot Grigio drunk – people can pronounce it, and it tastes quite inoffensive.
“We need to get people to buy wines that are interesting and suit their taste in non-patronising ways.
“I think this is one of the most innovative things in recent years in the trade.”
More than 50,000 people have taken the Bibendum Taste Test. Those that complete the test give their age, gender and postcode, so Bibendum can help retailers realise what wines people in their areas might like.
Saunders believes that by the end of the year the amount of people to have taken the Bibendum test will have more than doubled.
He was speaking at the Bibendum tasting in London, where just under 1,000 wines were on display after 300 producers flew in to support the tasting from all over the world.
He added that he was disappointed not to have sold as much wine as he expected during the Olympics after securing the contract to supply wines to the Games.
“It was a great project, I’m glad we did it and I would do it again,” he said.
“We didn’t sell as much as we hoped but we are re-labelling wine that was not sold and selling it on.
“Our profits were smaller than in 2011 but we still grew and I predict we will grow again in 2013.
“We are not a plc so I am able to take bold moves to grow the business and I think with the Taste Test behind us we will do well.”