Oddbins verges on collapse: the trade reacts with sadness and concern
The trade has reacted with sadness and concern to the news that Oddbins has lined up administrators following an “extremely tough” Christmas trading period.
Around 500 jobs are at risk after European Food Brokers, which owns Wine Cellar and Whittals Wine Merchants along with Oddbins, filed a notice of intention to appoint Duff & Phelps to handle insolvency.
It follows hot on the heels of news that M&O Trading, the owner of the Hartley’s and Mulberrys off-licence chains in the southeast of England, has collapsed into liquidation.
It is also less than a year since the demise of Conviviality and the turmoil endured by Bargain Booze and Wine Rack, pointing to challenging times for high street drinks retailers.
According to information seen by prospective buyers, EFB’s drinks retailing business – which includes around 100 stores – made a net loss of just over £4 million in the 18 months to July 31, 2018.
EFB blamed Brexit and the effect it has had on exchange rates for its woes, sparking furious debate on social media.
“The deterioration of the high street, combined with the continuing economic uncertainty surrounding the withdrawal of the UK from the EU, has resulted in an unsustainable, tough physical retail market,” it said. “We will endeavour to continue to operate all stores as a going concern while options are assessed for the business, including a possible sale.”
“High street retail for wine is so tough,” said Dan Kirby, sales and marketing manager at Corkr Fine Wines. “The appetite just isn’t there. It’s either supermarket or super-niche, in my opinion. Not a huge amount of room for middle of the roaders.”
Oddbins began life in 1963 and the estate grew to 350 stores across the country at its peak, when high street drinks retailing was in its heyday.
It was plunged into administration in 2011, when EFB purchased the Oddbins name and rescued a smaller collection of stores from the brink.
The estate now stands at 47 stores, and managing director Ayo Akintola’s plans to return Oddbins to a 300-strong national chain sadly have not come to fruition.
Many consumers confessed they did not know Oddbins was still in existence, as it no longer has nationwide reach.
Trade insiders fear that there could be no way back for Oddbins now.
“If Oddbins go down this time I fear they may not find a new buyer in this difficult high street retail environment,” said Greg Sherwood MW, senior wine buyer at Handford Wines. “Will be very sad. Another route to market potentially closing for many wine producers.”
Ana Sapungiu MW and Jenny Smith have worked hard to source an interesting and eclectic range of wines from across the world over the past couple of years. But the chain has seemingly been battered by exchange rates, which have made trading difficult in an already challenging market.
Is Brexit the route of the problems?
EFB blamed Brexit for its struggles, but Toni Klare said: “Oddbins has been flirting with administrators for years – absolutely nothing to do with Brexit.”
John Lloyd said: “It has nothing to do with Brexit, just bad management.”
Brexiteers found themselves incensed on social media, with one claiming: “What a load of crap. Oddbins, you failed because of tough competition in the market with other independent shops and huge supermarkets competing against you. But no instead, why not just blame Brexit for all your troubles?”
This drew an equally furious response from one Oddbins employee. “I can tell you for sure Brexit has absolutely been the death knell for the company,” he said.
“The company has indeed has it problems but they have been massively exacerbated by Brexit.
“We cannot buy wine for the price we once did. Simple maths. The exchange rate has plummeted since Brexit.
“I’m sure anyone running a business that imports agrees. Couple that with uncertainty on the high street, massively increasing rents, then you have a perfect storm.
“The pound simply does not stretch far enough these days. Plenty companies sell products that are almost exclusively imported.
“How is a company that imports the vast majority of it’s product not going to badly effected by Brexit? We cannot buy wine from Europe, Australia, USA or anywhere for the price we once did.”
There is plenty of debate raging, but many wine lovers in the industry are simply full of sadness and they remain hopeful that the chain can be salvaged and that jobs can be saved.
“A shame especially as Oddbins were such a leading light in the 1990s, especially with their Fine Wine department,” said Roger Jones of The Harrow at Little Bedwyn.
Henry Jeffreys, a former Oddbins employee and now a drinks writer, said: “Really sad to hear that Oddbins has gone under again. A place where so many great people in the drinks trade got their start. And me.”
Peter Richards MW said: “Really hope Oddbins finds a way through this. Top buyers; great wines; iconic brand.”
David Round MW, a consultant and educator, said: “Very worrying news for employees and suppliers. This is only the latest incarnation of Oddbins to run into trouble, but it's exceptionally tough on the high street. Hoping for the best, but fearing the worst.
Another former employee, journalist Jason Evans, said: “Sad to seen the once mighty Oddbins is set to go into administration for the second time in less than a decade. In a previous life I spent many happy years working for the company. At its best it was brilliant.”
Inverarity Morton buyer Toby Sigouin said: “Very sad. I started my wine career with Oddbins, as did many back then. A very tough market these days.”
Vino, the regional wine store chain in Scotland, tweeted: “Holding hands with all the Oddbins team in Edinburgh tonight. Some of us went through the same and for some of them it’s not the first time.”
“Genuinely gutted for good people who are going through this for the second time,” added Jack Witts.
Candice O’Reilly said: “Real shame about Oddbins. They introduced me to a vaster range of wines than all the other retailers put together. Want to make a small fortune out of wine then start with a large fortune.”
Tim Unwin said: “This is so very sad. Oddbins played a hugely important role in educating wine drinkers, especially in the 1980s and 1990s.”
Julie Ashworth added: “They really do have some of the best staff out there. For all the talk of Tesco today [the retailer is to cut 9,000 jobs] and lack of speciality expertise on counters, Oddbins were both experts and enthusiasts.”
James Morris said: “This is a shame. I see small independent retailers as atypical of most off-trade sales in that quality over quantity more of a significant factor. I often see Oddbins in Balham empty but two doors along Sainsbury's plonk filled wine aisle bustling with grab and runs.”
Majestic Wine employee Ed Wright added: “Sad day for the Oddbins family. Hope they can find a way through to continue.”
It has caused many people to reflect on the times they had working for Oddbins at the height of its empire.
Richard Cassidy said: “Sad news about Oddbins. Had such fun working for them back in the 90s. Think I worked in 15 stores. They were always chaotic but it felt like being part of something special.”
Puss Stein said: “This is particularly sad for me as when I was the assistant manager of the Oddbins in Gloucester Road, London, we got a new junior assistant. We have now been married for 27 years.”
Bottle shop Independent Spirit of Bath tweeted: “I remember when oddbins went down the first time. A lot of really talented folks lost their jobs. I hope they find a buyer, there’s some great people working there.”
However, there was less sympathy from importer Leon Stolarski. “Déja vu,” he said. “The previous incarnation went bust owing millions in unpaid bills and tax, and its creditors – mostly wine growers – got back less than 5p in the pound. As a wine merchant, my first rule is to not f*ck my growers over. Sympathy for the staff, yes – but not Oddbins itself.”
Meanwhile, Dan Williams, owner of indie The Bottle Shop in Roath, Cardiff, said: “Oddbins has been a lame duck for over a decade. Greed and lack of care... classic way to lose money and fuck people out of jobs.”
Just the start?
There are now concerns that more household names could struggle after the problems encountered by EFB and M&O Trading, plus online retailer Wine Direct, which has also gone into administration.
One senior buyer at a leading multiple retailer told DRN: “This is just the start. Expect more businesses to go under. People were practically giving away wine over Christmas and conditions are so tough.”
However, it is worth noting that off-trade BWS sales enjoyed strong growth throughout 2018 and then climbed 3.8% over Christmas (Nielsen). A number of independent merchants also reported roaring trading, as did various online operators, so it could be a case of winners and losers in a polarised market in which the middle has been squeezed to breaking point.