Dec 19: Despite several hurdles and road blocks on the way making wine marketing a big challenge for any honest businessman in India, the imported wines did make a reasonable progress last year with most of the complaining importers improving their sales and with Pernod Ricard breaking the 100,000-case mark and maintaining the No. 1 position in India’s Top Ten Importers List, writes Subhash Arora
After being a bit of a laggard for a couple of years for problems and issues with FSSAI during which Jacobs Creek kept a slightly low profile, yet maintaining its leadership position, Pernod Ricard (PR) has become aggressive now and is not only pushing the sales of the ubiquitous Jacobs Creek (JC), but has also introduced the high-volume entry-level Campo Viejo Joven (young) from their Rioja winery The modestly priced wine is inching ahead at an MRP of Rs. 1800 in Delhi. It has also started to promote wines from Brancott Estate in New Zealand (formerly known as Montana Estate and imported in India by Brindco).
Brindco concedes leadership in volume, not value
Aman Dhall of Brindco concedes that PR is well ahead of his sale of 85,000 cases, which is 12 % increase over last year and that there is now a wider gap of around 20,000 cases. But he stresses he is not into the numbers game-his wines are at least 3 times higher in value on the average and perhaps with higher profitability. Of course, the objective of the ‘Top Ten Importers’ initiated by delWine about 6 years ago was to gauge the increase in consumption of imported wines and recognise the top ten drivers of the numbers. It is pertinent to note that the sales were higher by over 25% despite the higher prices of at least 10-15% during 2017-18.
There are not too many surprises in the Top Ten importers; their sales were higher by 11.67% at 388,500 cases vs. 333,000 cases in 2016-17. Most importers have maintained a reasonable upward trend of around 10% except Berkmann Cellars India which recorded a massive growth of about 30% over the previous year.
Sula has shown slight downward trend ostensibly because of some change in portfolios and the management of Hardys that announced increase in its export prices resulting in higher costs to the consumer, putting a brake on the aspirations of Sula competing head-on with JC .
Here is a table of the Top Ten and their comparison with the previous year:
S.No. |
Importer |
2016-17 * |
2017-18 |
1. |
Pernod Ricard |
78,000 (1) |
105,000 |
2. |
Brindco |
76,000 (2) |
85,000 |
3. |
Aspri |
31,000 (3) |
34,000 |
4. |
Berkmann India |
22,500 (7) |
30,000 |
5. |
Sula |
31,000 (3) |
29,000 |
6. |
Prestige |
25,500 (5) |
27,000 |
7. |
Moet Hennessy |
25,000 (6) |
27,000 |
8. |
Hema Connoisseur |
18,000 (8) |
18,500 |
9. |
Radico Khaitan |
17,000 (9) |
18,000 |
10. |
Wine Park |
- |
11,000 |
11 |
Ace Beveragez |
11,500 (10) |
|
|
Total |
333,000 |
388.500 |
|
Growth y-y |
12.84 % |
11.67% |
* Rankings in 2016-17
Consumption in 2017-18
Over the years the percentage of Top Ten importers has been coming down gradually from 70% as more and more smaller importers enter the market. Our estimate is that the Top Importers represent around 65% now. Even at the original 70%, the estimate of Top Ten importers controlling the market, the annual consumption of imported wines can be estimated to 388,500/.7= 555, 555 cases.
We can thus safely assume that the amount of wine consumed in India was say, 550,000 cases rounded- 10% more that the half a million mark.
Other Assumptions
It must be clarified that the sales figures for Top Ten are only qualified estimates; we have relied on information beyond the official data which is scarce and can be confusing and expensive to get. Sales include those to the embassies and consulates across India, sales at duty free shops and the samples received from overseas. Hand carried wines are also a part of wine consumption as are directly ordered wines for personal consumption (remember anyone can import directly for self use). We are considered ‘bold’ for publishing this data and sticking our neck out since no official source releases the data.
Some importers are notoriously known to re-export to the other countries. Whereas we make efforts to remove the re-export figures, if only because it inflates the consumption figures otherwise, it is likely that some of these figures creep in our estimates. While it would be true for any such study, one must be wary of this factor included in such surveys.
Many importers like Moet Hennessy India and Pernod Ricard and even a few small importers of no consequence are tight lipped about their figures. Our figures are compiled by repeated questioning, surveys, frequent one-to-one chats with importers, hotels, restaurants and cross-checking with competitors, relying on the goodwill earned by delWine for objectivity and neutrality over the years. The results are published on ‘Without Prejudice’ basis. Since we are interested in consumption only, we consider sales by the cases only and not by value.
Importers or Distributors
There have been purists who claim that Pernod Ricard is not really an importer but a Distributor which merely distributes its own labels like other distributors who are multi-brand distributors. Same thing has also been said about Moet Hennessy India which has been importing champagnes wines produced by the same company. This is of no relevance to delWine which has been tracking merely the wine consumption and recognizing the Top Ten importers as they are the engines driving the imports-with around 70 % controlling the share earlier; with many smaller importers joining the fray, this percentage has been constantly coming down. As an example, Gusto Imports that sold merely a couple of thousand cases 5 years ago, crossed 9,000 cases this year and is quietly working to become a Top Ten importer.
Current year 2018-19
As always, the importers are busy fighting fire for their survival. Not only must they make the most of it during the 5-high season months of November -March, they must also get ready for the next hurdle- new wine laws that will be operational on April 1, 2019. They also need to find alternate markets due to the heavy fall in sales in Haryana and higher label registrations cost in Delhi this year.
The beneficiary will obviously be the new entrant to the List in 2019 -Lake Forest Wines which has an absolute monopoly in marketing wines and spirits in Haryana for the second year. 2017-18 was really a year of organising themselves and they did not sell much of their own imports but the current year has been their focus on their direct imports in Haryana. They have also been opening up the market gradually in Delhi and beyond. The loss of sales in Haryana is being sought by importers to be compensated by opening up new markets and by all accounts most of them are doing well in desperation.
Delhi has been a disastrous market this year with the government announcing the policy 5-months late and when it did, it exploded a rocket by increasing the annual registration charges 6 times form Rs. 10,000 to Rs. 60,000 each! Naturally, this will benefit importers with deep pockets who can take a bigger share of the pie. While Brindco has also dropped its registration of new labels by 30%, Wine Park has brought down its labels from 60 to 30, a 50% drop. This does not spell well for the growth of wine industry in Delhi and certainly a stifled Haryana.
We can only wish them good luck and cheer them up with a JAI HO!!
For earlier related Articles, please visit:
Top Ten Importers 2016-17
Brindco leads Top Ten Importers List 2015-16
Top Ten Importers 2014-15: Pernod Pips Brindco to the Post
Roller Coaster Ride with same Top Ten Importers
Subhash Arora
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