This line from the late, great Lou Reed, aptly describes the two main wine stories of the past ten days. Both stories have been released via mainstream media – not the wine trade itself – and possess immediate appeal. Lets break it down: “Believe none of what you hear” – the prophetic and potentially John Martinesque global shortage of wine (conveniently omitting stats for 2013) was raised by Morgan Stanley Australia, and pounced upon by the press. The second, highlighting the fluctuating discount/inflation policies adopted by the major UK supermarket chains, was initially brought to our attention by BBC Watchdog and the wine critic Oz Clarke. “Believe half of what you see” – as there is no shortage of cheap wine on my dirty boulevard.
About a dozen years ago (when Lou and I were in our pomp) I was invited to a forum, by the then editor of Harpers, Tim Atkin, entitled “The Global Wine Surplus – Opportunity or Potential Nightmare?” – no return to boom and bust to quote the remarkably elusive Gordon Brown. It wasn’t ironic, merely a genuine concern at the time. Interestingly, a certain Alan Cheesman (then director of wine at Sainsburys) was a panellist, the same Alan Cheesman who appears in the BBC watchdog episode – albeit in a retired capacity. He had this to say on the subject of the impending tsunami rolling across the global wine lake back in the day. ” I am not convinced it will materialise as quality wine” and warned that “Poorly made wine from any source will not benefit the consumer ….. long term reduced prices could destroy profit, the wine category and shareholder value”. Prophetic indeed, and as true now as then.
So, is the current practice of deep discounting and over inflation the result of a surplus or a shortage? Furthermore, is there a trend to chase volume or value? Lets dismiss the obvious vagaries of weather for the sake of argument. Global production can vary as much as 25% – in either direction – from one vintage to the next, but overall wine production has, in general, an accepted upward trend – particularly if new vineyard plantings are considered.
Wine prices in supermarkets do fluctuate, sometimes alarmingly so, but these fluctuations are in line with many other commodities – particularly furniture and clothing which, as we are all aware, may be manufactured both cheaply and unscrupulously – the VOR has assured me that she only buys clothing and shoes when on sale. Wine, over the years, has become cleaner and of mostly better quality, although we may legitimately complain of blandness, neutrality and an over reliance on unfermented sugar. But who is driving this trend – a global recession does not dictate a producer/supplier driven market – so is it a retailer/consumer conundrum?
The answer must be in the affirmative. Walk around the wine section of any supermarket and you will see a plethora of deals. I wont bore you with the detail, but suffice to say that whilst considerable marketing muscle is involved, the chains are merely giving the consumer what they want – or indeed deserve.
With crippling energy and fuel prices, a global recession and pay freezes across most sectors, consumers have no choice but to save money where they can. Inevitably this falls on the weekly shop. Growing populations, poor weather and increasing demand for food have pushed prices up – but is this the same for wine?
Perhaps it is a question of education, think about it Dear Consumer, are you really getting value for money from those 3 for £10 deals? The answer must be negative – but are you getting it for your £3 latte or cappuccino? A large latte at 2.85 contains just 10p worth of coffee, the remainder going on the cup, the stirrer, the premises, the staff and tax. The VOR routinely has two of these with the girls on a daily basis but baulks at the price of wine, and, being the holder of the family purse strings (I am a beta male) regularly subjects my sensitive palate to supermarket wine deals. Now a £4.99 bottle of wine equates to just 20 pence worth of quality, the same level as two lattes, but cheaper overall as you can share it – if its not too horrid. Consider also the price of a pint of beer at an average of £3.85 – a pound more than a latte but cheaper than a bottle of wine – and no you cannot share it! Conclusion, coffee is overpriced, beer about the same as some artisan bread, and a decent bottle of wine is almost impossible to find for less than £6.99.
So, while Lou sets the twilight reeling, I leave the last word to John Ruskin.
” It is unwise to pay too much, but it is worse to pay too little. When you pay too much, all that you lose is a little money. When you pay too little, you sometimes lose everything because the thing that you have bought is incapable of doing the thing that it was bought to do”
“The common law of business balance prohibits paying a little and getting a lot. If you deal with the lowest bidder, it is well to add something for the risk you run, if you do that you will usually find that you have enough to pay for something better”