Wine Takes Off in C-Stores
September and October has seen consumers “really moved toward value wines,” says wine industry expert Jon Fredrikson of Gomberg Fredrikson & Associates, and away from restaurants and bars. Restaurant sales have slowed as much as 12%-15% from the same period last year, stemming from a combination of high gas prices and bad economic news. Instead, consumers are purchasing their wine from off-premise retail locations and increasingly trading down to wines priced less than $15 and particularly under $7a bottle.
The Napa Valley Vintners trade association polled 330 of its members on results from October wholesale and direct-to-consumer sales compared with the 12 months before. Of the mix of 60 small, medium and large producers that responded, 42% said sales through distribution increased, 22% indicated no growth and 36% pointed to a decline. Napa Valley Vintners spokesman Terry Hall noted that since inventories at wholesalers are “very tight,” it is good “to be up or flat.” In addition, retailers are closely watching their inventories and preferring to order smaller, more frequent shipments.
WINE TAKES OFF IN C-STORES. With that said, we decided to take a look at the wine category’s recent performance in the off-premise. Information Resources is rolling out their new c-store "All Scan" service, which scans over 11.5k stores, now that it has enough historical data. We were given a sample, and it shows that table wine volumes are growing faster in the newer c-store channel (with relatively easier comps) than in food and drug stores. Dollar sales of table wine in c-stores grew 10.9% in the four weeks to November 30, while food and drug stores saw sales of 4.1%.
Domestic table wines performed strongly in both food/drug stores (6%) and c-stores (13.9%), but volumes of imports declined -1.8% in food/drug and grew 2.6% in c-stores. C-stores traditionally offer more mainstream wine brands and less selection.
The $20+ table wine category performed poorly in c-stores, with dollar sales dropping -21.7%. The $11-$14.99 was down -8.5% and the below $3 segment declined -4.5%. Meanwhile, food and drug stores showed value growth in all price categories except for the ultra-premium $20+ category which declined -6.2%.
The table wine price category that performed most strongly in c-stores was $5-$7.99 and grew 18.5%. The $8-$10.99 range rose 16.6%. Meanwhile, food and drug stores saw the most dollar sales growth, 7%, in the below $3 price group. The second fastest tier for food/drug was premium wines priced $11-$14.99, which grew 5.7%.
FASTEST GROWING BRANDS IN C-STORES, FOOD AND DRUG. Barefoot gained a full share point in dollar sales, making it the fastest growing wine brand in the period in food, drug and c-stores. Mirassou and Folie A Deux California table wine both came in second, gaining 0.2 points of share.
As far as the top five wines in dollar sales are concerned, Yellow Tail lost -0.1 of share, according to IRI, followed by Sutter Home (+0.1), K-J Vintners (+0.1), Woodbridge (0) and of course Barefoot.
NY GOVERNOR PROPOSES MORE WINE AT RETAIL
A 2009-2010 budget proposal by Gov. David Paterson could allow nearly 20,000 retail stores in New York sell wine. The amendment would allow beer-licensed grocery stores, warehouse clubs, drug and convenience stores to sell wine with a State Liquor Authority license. The bill would exclude beer distributors and similar beer-only outlets. As you can imagine, New York liquor stores are against the initiative, and some local winemakers worry wider availability of popular out-of-state wines will hurt their sales. Liquor authorities say the move would generate more than $150 million in revenue for the state in licensing and franchise fees over three years, while boosting the state's wine makers and customer convenience. The proposal requires lawmakers' approval and would take effect six months after passage.
CONSTELLATION: HIGH U.K. DUTY LEADS TO LAY-OFFS
The UK’s biggest wine supplier, Constellation Europe, has laid off 50 employees as a result of the 8% duty increase in the Pre-Budget Report. The company said further job cuts and a reduction in promotional investment are likely unless “there is a rapid change of policy,” according to the Times Online.
Troy Christensen, president of Constellation Europe, said: "If there's another duty increase, then the only thing you can do is reduce your local investment even further". According to Troy, the two duty increases this year has cost the company £50 million.
"We are a global company and we tend to put investment in countries that produce the best returns. At the moment, there are a lot better opportunities elsewhere in Europe," he said.
WHOLE FOODS GAINS SENATORIAL BACKING
Eight senators are backing Whole Foods’ fight against the FTC by signing a letter that says the government agency acted unfairly in changing its rules for investigating mergers. The signatories include Senators Patrick Leahy of Vermont, Arlen Specter of Pennsylvania, Tom Harkin of Iowa, Dianne Feinstein of California, Charles Schumer of New York, Ben Nelson of Nebraska, Benjamin Cardin of Maryland and John Cornyn of a Texas.
As you’ll recall, Whole Foods successfully merged with Wild Oats in 2007 but the FTC is still assessing the transaction it after an earlier defeat, which could result in a de-merger. The senators criticized the FTC for moving too fast in adopting a new process for assessing mergers and having commissioners preside over hearings held prior to internal trials by FTC administrative law judges. Commissioners also vote to investigate mergers.
Until tomorrow, Megan
"The great thing about not planning is that failure comes as a complete surprise rather than being preceded by a period of anxiety and worry."
Warren Buffett
--------- Sell Day Calendar ----------
Today's Sell Day: 12
Sell days this month: 22
Sell days this month last year: 20
This month ends on a: Wed.
This month last year ended on a: Mon.
YTD sell days Over/Under: +1
BEER SUMMIT 2009 - The Four Seasons, Austin, Texas - Join us for great speakers, intelligent discourse, good food, and of course great beer at the next Beer Summit on March 1 - 2, 2009. Click here: http://tinyurl.com/beersummit
WINE & SPIRITS DAILY
Subscribe or check back issues at: www.winespiritsdaily.com
Send news and comments in confidence to: megan@winespiritsdaily.com
© 2008 Wine & Spirits Daily, all rights reserved. May quote with attribution.
The Napa Valley Vintners trade association polled 330 of its members on results from October wholesale and direct-to-consumer sales compared with the 12 months before. Of the mix of 60 small, medium and large producers that responded, 42% said sales through distribution increased, 22% indicated no growth and 36% pointed to a decline. Napa Valley Vintners spokesman Terry Hall noted that since inventories at wholesalers are “very tight,” it is good “to be up or flat.” In addition, retailers are closely watching their inventories and preferring to order smaller, more frequent shipments.
WINE TAKES OFF IN C-STORES. With that said, we decided to take a look at the wine category’s recent performance in the off-premise. Information Resources is rolling out their new c-store "All Scan" service, which scans over 11.5k stores, now that it has enough historical data. We were given a sample, and it shows that table wine volumes are growing faster in the newer c-store channel (with relatively easier comps) than in food and drug stores. Dollar sales of table wine in c-stores grew 10.9% in the four weeks to November 30, while food and drug stores saw sales of 4.1%.
Domestic table wines performed strongly in both food/drug stores (6%) and c-stores (13.9%), but volumes of imports declined -1.8% in food/drug and grew 2.6% in c-stores. C-stores traditionally offer more mainstream wine brands and less selection.
The $20+ table wine category performed poorly in c-stores, with dollar sales dropping -21.7%. The $11-$14.99 was down -8.5% and the below $3 segment declined -4.5%. Meanwhile, food and drug stores showed value growth in all price categories except for the ultra-premium $20+ category which declined -6.2%.
The table wine price category that performed most strongly in c-stores was $5-$7.99 and grew 18.5%. The $8-$10.99 range rose 16.6%. Meanwhile, food and drug stores saw the most dollar sales growth, 7%, in the below $3 price group. The second fastest tier for food/drug was premium wines priced $11-$14.99, which grew 5.7%.
FASTEST GROWING BRANDS IN C-STORES, FOOD AND DRUG. Barefoot gained a full share point in dollar sales, making it the fastest growing wine brand in the period in food, drug and c-stores. Mirassou and Folie A Deux California table wine both came in second, gaining 0.2 points of share.
As far as the top five wines in dollar sales are concerned, Yellow Tail lost -0.1 of share, according to IRI, followed by Sutter Home (+0.1), K-J Vintners (+0.1), Woodbridge (0) and of course Barefoot.
NY GOVERNOR PROPOSES MORE WINE AT RETAIL
A 2009-2010 budget proposal by Gov. David Paterson could allow nearly 20,000 retail stores in New York sell wine. The amendment would allow beer-licensed grocery stores, warehouse clubs, drug and convenience stores to sell wine with a State Liquor Authority license. The bill would exclude beer distributors and similar beer-only outlets. As you can imagine, New York liquor stores are against the initiative, and some local winemakers worry wider availability of popular out-of-state wines will hurt their sales. Liquor authorities say the move would generate more than $150 million in revenue for the state in licensing and franchise fees over three years, while boosting the state's wine makers and customer convenience. The proposal requires lawmakers' approval and would take effect six months after passage.
CONSTELLATION: HIGH U.K. DUTY LEADS TO LAY-OFFS
The UK’s biggest wine supplier, Constellation Europe, has laid off 50 employees as a result of the 8% duty increase in the Pre-Budget Report. The company said further job cuts and a reduction in promotional investment are likely unless “there is a rapid change of policy,” according to the Times Online.
Troy Christensen, president of Constellation Europe, said: "If there's another duty increase, then the only thing you can do is reduce your local investment even further". According to Troy, the two duty increases this year has cost the company £50 million.
"We are a global company and we tend to put investment in countries that produce the best returns. At the moment, there are a lot better opportunities elsewhere in Europe," he said.
WHOLE FOODS GAINS SENATORIAL BACKING
Eight senators are backing Whole Foods’ fight against the FTC by signing a letter that says the government agency acted unfairly in changing its rules for investigating mergers. The signatories include Senators Patrick Leahy of Vermont, Arlen Specter of Pennsylvania, Tom Harkin of Iowa, Dianne Feinstein of California, Charles Schumer of New York, Ben Nelson of Nebraska, Benjamin Cardin of Maryland and John Cornyn of a Texas.
As you’ll recall, Whole Foods successfully merged with Wild Oats in 2007 but the FTC is still assessing the transaction it after an earlier defeat, which could result in a de-merger. The senators criticized the FTC for moving too fast in adopting a new process for assessing mergers and having commissioners preside over hearings held prior to internal trials by FTC administrative law judges. Commissioners also vote to investigate mergers.
Until tomorrow, Megan
"The great thing about not planning is that failure comes as a complete surprise rather than being preceded by a period of anxiety and worry."
Warren Buffett
--------- Sell Day Calendar ----------
Today's Sell Day: 12
Sell days this month: 22
Sell days this month last year: 20
This month ends on a: Wed.
This month last year ended on a: Mon.
YTD sell days Over/Under: +1
BEER SUMMIT 2009 - The Four Seasons, Austin, Texas - Join us for great speakers, intelligent discourse, good food, and of course great beer at the next Beer Summit on March 1 - 2, 2009. Click here: http://tinyurl.com/beersummit
WINE & SPIRITS DAILY
Subscribe or check back issues at: www.winespiritsdaily.com
Send news and comments in confidence to: megan@winespiritsdaily.com
© 2008 Wine & Spirits Daily, all rights reserved. May quote with attribution.
posted at 1:34 PM
<< Home