4. Different Options For Getting The Wine To The Point Of Sales. Flashcards
Why wine market is seldom a free market?
- Government control, tax rising, tax revenue on alcoholic beverage.
- Reduce alcohol abuse
- Minimise humful effect.
- Strain on health system.
5.reduce criminal that increase security risk
How does government control the wine market?
- Tax, Inc import tax and VAT.
- Limiting the trade place and hours (monopoly)
- Legal age
Describe the pros and cons of selling direct to retailers.
Producers contact and sell wine direct to retailers without any intermediaries.
Pros:
1. No intermediaries.
2. Decide which retail to stock.
3. Decide how to market the wine.
4. Control over brand image.
Cons:
1. Not possible to large retailers. Promotions discounts
2. Fees may be payable to large Chains.
3. Promotion and penalties may apply.
4. Loss of brand image.
5. Administrative burden, producer create sales department.
6. Additional staffs handle import tax, training labelling compliance.
Solutions
1. Forwarders.
2. Appoint distributors to handle numerous small retailers.
3. En primeur
4. Bulk transport to foreign countries reduce cost. More competitive.
Describe how does appointing a distributor works in the wine business?
- Distributor buy, sell to retailer (ReHoCa), and represents the producers. Usually located in the same country as retailers. A distributor may or may not hold stocks.
Pros:
1. Consumer preference, trend.
2. Legal requirement.
3. Relationship with retailer
4. Reduce administrative burden, transport, and label compliance. Stock management. Delivery.
5. Time saving. Producer focus on production.
6. Target preference customer
7. Language.
8. Planning, trade show, event.
Cons:.
1. Margin, reduce prifit.
2. Different strategies than producers, loss brand image.
3. Loss focus, present multiple produce.
4. Drop produce, sale not hit target.
Solutions
1. Good distributor.
2. Good plan, build relationship
3. Trade fare
What are the options for wine getting to the point of sales.?
- Selling direct to retailers.
- Appointing a distributor.
- Establish a joint venture
- Use a broker.
- Selling direct to customers
- Wine clubs
- Online
How to build a successful joint venture and what is the pros and cons?
- A joint venture means the two different companies with specialties work together to reduce cost or share responsibility.
How?
1. Comparable size
2. Contract， agreemt, documents.
3. No direct competition.
4. Create new brands
Pros.
1. Share cost, more profit, reduce intermediaries.
2. Great control business type
Cons:
1.difficult to leave
2. Take over by another company
what are the differences between a merger and an acquisition?
- Merger - two similar size companies joint together to create greater opportunities and get larger resources.
- Acquisition- happens when a company (usually a larger one) buys the small one and become its subsidiary. The reasons inc. Skills, market shares
What are the pros and cons of a merger?
PROS
1. Become more competitive.
2. Greater resources
3. Greater capability.
CONs
1. May be having an equal partnership.
2. Loss control
3. Not managing properly.
What are the pros and cons of an acquisition?
Pros
1. Acquire capabilities- skill, market shares and primary location of a vineyards.
2. Save a company from going out of a business- reduce cost, maintain price,
3. Larger distribution
4. Open new routes to a market.
Cons
1. Loss of control of a company.
2. Fail and into administration, financial difficulties.
What does A broker means and the pros and cons of using one?
- Different than distributor who is paid by producer
- Cheaper than a distributor normally take 2 %.
- Not into deals.
- Not represent any one.
Pros. - Knowledge of particular market.
- Bring buyers together save time for both parties.
- Fund the producer and buyers-l
What are the forms of sell directly to customer?
- Cellar door sales
- Event
- Wine clubs
- Online
What’s are pros and cons of selling wine direct to customer?
Pros:
1. Larger profit.
2. Control over how the wine is marketed.
Cons
1. Cost of hiring staff
2. More administration such as logistic
What is a cellar door sales and the pros and cons of having one.
The place set up buy producer on their estate or winery to sell wine to customers.
1. Pick up wine
2.tourists
Pros
1. Offer experience. Tasting reserve, tour.
2.atrractive shop.
2. Tasting before. Buying
4. Engaging, story telling
5. Profit
6. Brand awareness。loyalties.
7. Recommand to friends for free.
8. New product trail.
Cons.
1. Expensive to build
2. Costly to manage and hiring staff
3. Bad locations.
4. Not able to focus on find new market.
What are pros and cons of holding event?
- Great way to expose the brand.
- Tasting before buying.
- Introduce website to wine club at event.
- Good hemisphere, other attractions music etc..
Cons” - Fees
- Travelling
- Staff
- Not wine focus, waste of money.
What are pros and cons of having an online store.b
- Customer comfort
- Reduce travelling, delivery or pick up at the closest store
- Profit
4.cheaper price.
Cons - Website maintenance
- Website design
- News update.
- No loyalty
