The Trade in Bordeaux Wines

Question 1

La Place de Bordeaux

Answer 1

1. It is a unique trade structure in the wine World.
2. In that structure, chateaux and cooperatives sell the wines through brokers, or courtiers, to the negociant.
3. In this system, chateaux and coopertives have not needed to invest i their own sales forces.
4. The supporters of the system, point out that it would be impossible for individual producers to get the exposure they currently enjoy, if they did not sell their wine through La Place de Bordeaux .
5. For very top chateaux the system remains a very convenient system because the structure gives them a potentially huge sales force through around 100 negociants operating around the World.
6. There are many critics of the system, about the cost of the structure and about the little control over the sale and marketing of their brands.
7. Some producers have done so to achieve better control of the distribution because they have power to invest in a global force.
8. La Place represents a ready made sales machine and it is unlikely the system will collapse any time soon.

Question 2

The courtiers

Answer 2

1. They are the brokers that place a important role inside of the structure of La Place de Bordeaux.
2. In that structure, chateaux and cooperatives sell the wines through the courtiers to the negociants.
3. Courtiers or brokers take a commission on every sale, around 2% of the sale.
4. Courtiers submits samples to negociant, obtain the best price and arrange the deal.
5. This happen for years, due to the fragmented nature of vineyard ownership.
6. Individual courtiers operated in very specific areas of Bordeaux where they had in-depth knowledge of all the growers.

Question 3

Negociant

Answer 3

They represent in the structure of La Place de Bordeaux a 3 important role:

1. Buys, blends and sells generic wine in bulk or in bottle.
2. Buys individual chateau wine to sell either in bulk or in bottle.
3. Buys individual chateau wine to release and sell at different maturity levels.

Question 4

How it is sell will structure in Bordeaux wines

Answer 4

Sur souche ( before harvest)
En primeur ( first or second offer, first year after vintage from late March. 
By hectolitre 
By Tonneau 900 litres ( 100 cases)
By barrel 225 litres or 25 cases 
By case

Question 5

En Primeur Sales

Answer 5

Producers, in order to get financial muscle and the get cash flow, release small quantities of the wine after the harvest, generally after the quality have been rated by critics.

1. Small quantities of stock released the March after harvest by top Chateaux to free up cash tied up in stock.
2. Best in times of financial boom as investors have excess money.
3. Price includes all cost up to, and including bottling and takes into account issues such as prestige.
4. Released in tranches.
5. Price increases with each tranche.
6. Can be a lottery, professional advice should be sought.
7. Wines are kept at chateaux and released to the buyer at approximately 2 years after harvest.
8. Traditionally, consumer benefited from the lower release prices compared with the sale price of the finished wines, but recent dramatic price rises of wines sold en primeur have challenged this notion.

Question 6

Influence on Price in Bordeaux

Answer 6

1. Quantity more important than quality for inexpensive Bordeaux.
2. Branded Bordeaux AC wine mainstains a minimum standard of consistency so can charge a slightly higher price.
3. Vintage condition affect price for top chateaux.
4. Marks by influential wine critics and magazines will have an effect on both price and style.
5. Petits Chateaux and Crus Bourgeois fall in between these two extremes.

Question 7

The future for Bordeaux Trade system

Answer 7

1. The burning question for Bordeaux is how to improve the quality, sales and reputation of the less expensive red wines.
2. This is difficult because, fragmented vineyard ownership,
3. Permitted varieties are at the northern limit of where they can successfully be ripened.
4. Unlike New World areas, there is never going to be easy to achieve of supply of consistently healthy ripe fruit by the producers.
5. The Conseil Interprofessionnel du Vin de Bordeaux in 2010 launched the Strategy Bordeaux Tomorrow, which aims to improve the quality and reputation of the generic wines of Bordeaux.