Future of Independents?

[my wine trek]

Hey all.

Had an interesting experience in the Illawarra recently trying to find some St Henri's. Where I found that pretty much most of the wine shops were major chains i.e. Dan Murphys, Liquorland. They explained they are a tiered system and that then drives the quality of wines they stock hence why they didn't have 2010. You really noted the lack of wine knowledge from most of the staff.

Do people think with internet and major chains, an independent can still survive profitably or is their time coming to an end?

Cheers

Brenden

[cuttlefish]

I think as long as there is convenience shopping there will be room for independent retailers. It's just when it comes to your more serious wine shoppers buying in volume that they'll go wherever the best price is, and that is the major retailers and online in most instances.
Independent liquor retailers who don't have any product knowledge are on a hiding to nothing as they offer so little to the consumer.

[paulf]

The trick for the independents is to offer something that the big boys don't. They generally can't compete on price, so they need to look at range they stock, their knowledge and advice to the customer, having events like tastings, training courses, corporate accounts, delivery services and additional focus areas like craft beer or artisanal spirits.
The independents that stick in my mind do a number of these things well. I only buy the odd bottle of wine from the independents but I do buy about 95% of my beer from them.

[Ozzie W]

I buy 99% of my wine from reputable online independents or online directly from the winery.

1. I've seen too many damaged and poorly stored bottles at the big retail chains. For example, dented screw caps, wine stored in a hot warehouse out the back, etc.
2. The big chains seem to think that vintage is meaningless. Buying online from these chains is often Russian roulette in terms of vintage you'll actually receive.
3. The price from online independents is usually cheaper (annoyingly, often cheaper than directly from the winery)
4. I don't need to lug heavy boxes around as the wine is delivered directly to where I want it.

The average wine drinker wouldn't care any of the above, hence why the big chains are doing so well.

[Duncan Disorderly]

Many years ago I worked at Vintage Cellars, and before that for a short period at Liquorland. I believe at the time there were two, maybe three, tiers for LL which would have been no doubt based on sales data from not only LL but from the Coles supermarket chains and other channels which Coles-Myer, as it was then, had. Vintage Cellars had tiers but the boundaries were a little more blurred, although it would have been worked out roughly the same way.

Of course there is no doubt there were some fancy algorithms at work, but at the time it wasn't rocket science to work out that suburban sprawl areas were considered to be home to drinkers of the sort of products the brands of which are easily substitutable (block beer, bourbon, Marlborough Savvy, sub $15 Barossa/McLaren Vale shiraz etc). The price sensitivity of these products meant they were more suitable to your chain retailers where volume is key, and large profits are only made on those buyers who were either desperate or not sensitive to price ($40 Wynns estate cabernet anyone?). Whereas inner city areas, particularly those with restaurants, had more independents as they were home to a greater density of potential walk in customers, a clientele who generally had a higher disposable income, were possibly more discerning (only bought the Wynns cab on special) and was looking for a wider variety of new or unique wines that big chains did not or would not stock (either because their ordering systems aren't nimble enough or because they are risk averse, or both).

Like I said I reckon there's a bit more science to it then suburbia v inner city, but I don't think much has changed. Either way I don't expect to see the end of good independents any time soon.

[sjw_11]

Like Ozzie, I buy 99% of my wine to cellar from independents (mostly online, such as our host Gavin) or in the vast number of instances direct from wineries.

For everyday consumption (and particularly for beer and whisky) I am certainly known to shop at the likes of Dan Murphy, or Cold Storage in Singapore, or Tesco et al here in the UK.

I think there will always be a place for good independends but the most successful will either be low cost and hence fully online OR will go for a higher level experential model. We are already seeing this a lot globally with the best independents making full use of the enomatic machines to offer a wide range of relatively cheap tasting options.

Such is the story for almost all retail today ... even the supermarkets will not be immune to the need to change

[dan_smee]

The two independents I buy from these days both offer a range of back-vintages that they guarantee as they have been stored since release in their own maturation rooms. More often than not, when I want to buy something other than a weeknight quaffer, I go to one of these. Never had a bottle heat or oxygen effected (though 1 or 2 were corked). Prices are probably only 5-10% over the retail chains anyway, but you often find the back-vintages for current release prices, which is great value in anyones books.

[Peter Schlesinger]

I'm the same as sjw_11 with my purchase patterns. Probably buy fewer than 6 bottles per year from the chains and then only when something potentially interesting appears. I also used the chains as a fall back option for beer in the past. However, living in Canberra, I now buy these from an independent outlet at the Fyshwick markets which offers slabs of imported Nastro Azzuri and Grolsh etc cheaper than the Australian brewed under license versions sold by the chains. As long as the chains stay away from anything approaching quality and customer service, the independents will be fine.

[Scotty vino]

The future of them depends on pricing, range and back vintage options.
There's some in Adelaide I've wandered into and I don't know why they bother but there are some that are quite good.

[sjw_11]

I now buy these from an independent outlet at the Fyshwick markets which offers slabs of imported Nastro Azzuri and Grolsh etc

Ah, you have just reminded me of when I used to live in Stanmore (Sydney) and the local corner store bottle shop managed for no reason I could ever fathom to sell proper local Peroni (Peroni red) for about $35/case, walking distance from my flat.

Good times.

[my wine trek]

Thanks for the comments and I also now know what enomatic is:-)

Cheers

[Mike Hawkins]

If the independents try to sell all the 'big house' labels, I think they'll struggle - they won't procure at the same price as the big boys. If they're like Gavin et al and focus on artisanals / niche producers that don't make enough wines to supply the big chains, they can expect to do well - and especially if they e-tail.

[Sigmamupi]

I buy 99% of my wine from reputable online independents or online directly from the winery.

1. I've seen too many damaged and poorly stored bottles at the big retail chains. For example, dented screw caps, wine stored in a hot warehouse out the back, etc.
2. The big chains seem to think that vintage is meaningless. Buying online from these chains is often Russian roulette in terms of vintage you'll actually receive.
3. The price from online independents is usually cheaper (annoyingly, often cheaper than directly from the winery)
4. I don't need to lug heavy boxes around as the wine is delivered directly to where I want it.

The average wine drinker wouldn't care any of the above, hence why the big chains are doing so well.

I would go further than the big chains thinking that vintage is meaningless. Dan Murphys sails close to the wind in terms of deceptive conduct in consumer law. Everyone knows that Barossa winemakers consider 2012 one of the best vintages in the last 20 years, whereas 2011 is a dog. The Dans tabloid style catalogue valid 2 July to 13 July had Grant Burge Filsell shiraz as a feature special at $24.70 in any six, indeed one of only 3 wines in a full page, with 2012 as the vintage listed. Surprise surprise - the stock in three Dans that I dropped into was all 2011. Solved the problem by putting in an order demanding 2012 as advertised, with the order supplied in stages as the correct vintage came into the store with the last dozen finally being completed today. They are at it again with St Halletts Blackwell shiraz, with 2012 listed as the vintage in the current Buyer's Guide and on the website, but 2011 in stores.