Beaujolais

I write a fortnightly wine column for the New Zealand Health and Wealth Report.  In November I wrote a somewhat critical column on a bottle of Beaujolais Nouveau I had purchased.  The wine was fine for what it was but was over priced at around NZ$45.  The same bottle here in Geneva was selling for SF3.50 (on discount).  At maximum price you would have paid more than SF7 (NZ$10) for this wine.  We paid over the top prices for Beaujolais Nouveau this year in New Zealand because it has to be air freighted and because our exchange rate had crashed against the Euro.  I suspect there was a fair amount of importer and retailer margin added in also.

 

What interested me more than the particular bottle of wine was the impact the Beaujolais Nouveau strategy has had on the economics of the Beaujolais region.  The strategy proved highly successful in terms of generating cash flow and getting rid of the region’s lower quality wines.  But it has come at the reputational cost of the higher quality wines from the 10 Beaujolais Crus.  The average consumer is not able to differentiate between Beaujolais Nouveau and a wine from one of the Cru vineyards.  The producers of the much finer Cru wines are therefore not able to sell their wine as easily or realise the price they deserve for their wines.  I concluded that long term, the Beaujolais Nouveau craze had probably done more harm than good for the region.

 

Since it is only a 2 hour drive from Geneva we went to Beaujolais as our family outing on Sunday.  We managed to visit all ten of Cru areas, probably the only tourists in the region on that day (the highest temperature was -2c).  It was a less than satisfactory visit in some ways as the restaurant we wanted to lunch at was closed (when all guide books said it would be open) and given that so few of the wine producers were open.  But I have come away more convinced than before that the Beaujolais Nouveau strategy I the wrong one for this region.  At their best, the higher quality Beaujolais wines are very good satisfying wines displaying distinct Cru character.  And the region is even more beautiful than I remembered from my last trip.  It clearly has greater tourism potential than it is realising. 

How Osama Bin Ladin Damaged The Wine Trade

The most profitable bottle of wine sold by a wine company is a bottle that it sells direct to the consumer.  Mail order and cellar door sales have always been a useful extra for our business (we export 80% of our production) but for some small producers it is the bread and butter of their business.  No one else gets a margin on the sale of the bottle.  I have seen a bottle of our Reserve Pinot Noir on wine lists in Sydney for A$120.  We have only received arond NZ$20 for that bottle.  The rest is margin taken by others.  Likewise we only receive around NZ$20 for the same bottle sold here in New Zealand at a retail outlet.  Our New Zealand agent and the retailer take the other $20.

Our cellar door is on State Highway 6.  There is lots of passing traffic.  As we are the first wine sales and tasting facility you strike when driving from the West Coast to Queenstown we get plenty of foreign tourists calling in.  In years gone by we used to sell good quantities of wine to these tourists – three to six bottle sales were common.  Sometimes they would even buy a case.  This wine was hand carried back to their country of origin. (I too used to buy multiple bottles of wine to hand carry back to New Zealand from various wine districts around the world.  I own a “pilot’s briefcase” which can hold 12 bottles of still or 9 bottles of sparkling.  Many serious wine tourists had similar devices available.)

Since 9/11 and subsequent terrorist incidents it is not possible to hand carry liquids in containers of more than 100ml.  Wine can be carried in cabin but only if purchased at airport duty free shops and in sealed bags from these shops.  So if a visitor to a winery wants to buy bottles of wine to take home they have to put them in checked in baggage.  This is risky even if one packs the bottles well in moulded wine packs.  It also affects the weight of one’schecked in baggage.  People don’t like packing wine in their suitcase, even to the States were weight isn’t an issue.  In consequence the amount of wine sold direct to foreign visitors has plummeted.  We still make plenty of single bottle sales (for consumption while in New Zealand) , but the multiple bottle sales are pretty much a thing of the past.  Wine tourism all over the world has been affected negatively by the hand carry on rules.

I personally think the rules are a bit of an over reaction.  And their strict intepretation is even worse.  I have seen alcohol purchased duty free in one jurisdiction confiscated at transit points in other jurisdictions on the grounds that it wasn’t purchased at that transit point (Frankfurt Airport does this regularly).  And I once had a near empty tube of tooth paste confiscated at Singapore Airport on the grounds that the tube said the contents was 120 ml.  These practices do not need to happen.  One day I hope we can revisit the 100ml regulation. 

Update – While writing this post we have had visitors from the UK and US (Seattle) call in for a tasting who have said that they can’t buy any wine because of this regulation…..