How the wine industry is missing out on huge potential sales by ignoring the independent grocery sector

Is it really? What makes you say that.

The fact you have even asked that question reveals the problem the industry has. For large parts of the wine sector the independent grocery, and convenience channels are after thoughts, if they are even a thought at all. When the wine industry talks about independents it means the few hundred specialist independent wine merchants and not the tens of thousands of grocery stores embedded in every local community in the country. Retailers that are too often dismissed as the local corner shop that you would only go to when you have run out of milk, or want to buy a National Lottery ticket. The fact they also sell millions of bottles of wine a year seems, for many, to be completely ignored.

But surely they are well served by the brands and wine companies that do take them seriously?

They are indeed. But why leave the sector to the major brands, and biggest producers who are willing to engage with and understand how the independent grocery sector works? There is so much untapped potential for serious, premium wine sales in the independent and convenience sectors. Yes, there are still those that have over-priced wine gathering dust on the top shelf. But the majority of independent grocers are highly professional and, crucially, very profitable, run by sharp operators who are increasingly coming together in efficient buying groups with a range of goods and services that offer a very real competitive alternative to the major multiples. Yet, bizarrely, it is a sector that remains largely unloved and if anything looked down upon by large swathes of the wine industry.

But surely if you want to buy serious wine you are going to go to a dedicated independent wine merchant to get it?

That's the problem right there. There is a dangerous and patronising attitude amongst many in the wine sector towards the independent grocery sector. A whole sector of the grocery market deemed not worthy of their products, or their time and attention. Instead large numbers of wine producers and suppliers will spend all of their efforts trying to get a not very profitable listing with a major multiple, or to squeeze an inch or two more space on a wine merchant’s shelf whilst ignoring all the independent retail stores further down the high street. How many major wine distributors put their best, most experienced sales and account managers in charge of their cash and carry customers? Yet some of these businesses have bigger turnovers than Manchester United - and are much better run.

But how many independent grocers, or cash and carries, take wine seriously?

The vast majority. In the same way they take selling milk, fresh fruit, vegetables, washing power, and every other grocery sector they work in seriously. No, they don’t take WSET exams and go to wine trade tastings. A large number won’t drink wine, or alcohol, at all. But ask any independent grocer and they can tell you the exact margin and profit for every product on sale in their store. They have to. That’s their business. They are born retailers. As focused on getting the right price, margin and profit out of a four bar Kit Kat as they are a bottle of Australian Shiraz. Retailers that live and breath retailing. They are as serious a retailer as the chief executive of Tesco. In fact, put an award winning independent grocer in charge of their local Tesco and they would increase sales, cut costs and make more money. Why do you think the major multiples look to see which independent grocer has won the Best Independent Retailer award and go out and look to open a store near by. Why do you think Tesco bought Booker, the biggest cash and carry operator of them all? The major supermarkets know it is the independent grocers that are the sharpest operators in the sector. Yet so many in the wine industry give them the cold shoulder.

So what should wine suppliers do?

Ask themselves some hard questions. When was the last time you went to check out the wine range in the local Spar or Costcutter? Do you even know where your nearest cash and carry is and which wine businesses they work with? Just because you have a wine diploma does not make you any better at picking out a wine, at a price you know your customer is going to want to buy. An independent grocer will know their local community’s likes and dislikes across every grocery category as well as you know members of your own family. They are talking to, watching and serving hundreds of customers a day. They open their stores when we want to use them. They don’t close at 7pm just when people are passing by looking to buy a bottle of wine on their way home from work…and they certainly don’t close on a Sunday.

Anything else?

We all talk about wanting to push up the average price of wine, frustrated we can’t sell more wines between £10 and £20. But that is the sweet spot for an independent grocer. They are looking for and want to sell wine at around £10 or more. They know their customers are willing to pay a bit more for the convenience of going to their local store. Look at the wine companies, producers, and brands that are taking the independent grocery and cash and carry sectors seriously. They all have one thing in common. They do their business very quietly and very much under the radar. For they know how brilliant, vibrant, dynamic and most of all profitable the independent grocery sector is - and they don’t want the rest of the industry to wake up to it.

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