Despite significant challenges on many fronts, the UK remains one of the largest wine-consuming countries. The total market value was estimated at £14.5 billion in 2023, according to research group Mintel. A wide range of styles contribute to this, from orange wines to local wines and mature claret wines.
However, reports of lower overall sales volume further underscore the importance of producers choosing the right path for themselves.
This year, a new Decanter World Wine Awards (DWWA) initiative seeks to help producers increase their chances of success.
Open exclusively to DWWA 2024 medal winners, the DWWA Market Directory will better connect producers with key UK buyers, importers and distributors. It aims to facilitate meaningful business conversations to ensure more quality wines and safe producer lists that suit all parties.
Driving in choppy waters
UK wine companies are no stranger to tight margins, although recent years have intensified cost pressures.
“The key challenges are the high cost of doing business which is forcing wine prices up and reducing volume across the industry,” said Steve Finlan, CEO of The Wine Society, a membership-based retailer that celebrates its 150th anniversary in 2024. .
“The obvious challenge is increased customs taxes and the specter of a ridiculous new duty regime (see below).” A less common challenge is current and future legislation that creates a barrage of red tape.
Finlan added: “Brexit has made things more difficult and affected business and speed. “This has been under control, and I would not exaggerate in describing Brexit as a drag on companies importing wine.
New alcohol duty regime: wine hangover?
August 2023 saw the biggest increase in alcohol duty tax in nearly 50 years, according to the UK Wine and Spirits Trade Association (WSTA). A new duty system based on alcohol strength has been introduced, although some measures affecting wine have been postponed to 1 February 2025.
Tariffs on sparkling wine fell by 12% by £0.19, and ministers highlighted the benefits of lower strength drinks, but fortified wine faced higher taxes and trade leaders criticized the cost and complexity of the new system.
The WSTA said: “From February (2025), a single amount of duty paid on wine ranging between 11.5 and 14.5% – currently £2.67 – will be replaced by up to 30 different amounts payable ranging from £2.45 to £3.10. For every bottle.
“The new alcohol tariff regime is certainly a major concern for buyers, who are actively looking for lower alcohol wines to mitigate rising prices,” said Beth Willard, DWWA co-chair and independent consultant.
This poses challenges for producers of wines that are naturally high in alcohol, Willard said. At the same time, she added, there may be “an opportunity for new producers in the market who can offer their products at higher prices by focusing on other qualifications – for example, sustainability, more environmentally friendly packaging, (and) innovative bottles or labels.” Designs'.
A snapshot of UK market trends
Sustainability in general is a big part of the equation. Retailer Majestic Wine recently said it aims to achieve net-zero emissions by 2050, for example. Alternative packaging has gained popularity with major retailers, from cans to Aldi, which offers South African wine in 'paper bottles'.
Other key trends include widely reported consumer interest in non-alcoholic or low-alcohol beverages, as well as moderation in alcohol consumption in general. Research group IWSR recently asked whether the UK was suffering from “Prosecco fatigue”, but reiterated that sparkling wine sales had outpaced the overall decline in the size of the wine market.
Champagne is a mainstay of the market, yet retailer Waitrose said in March that sales of Crémant sparkling wine were up 29% year-on-year. She said more shoppers are looking for affordable alternatives amid rising costs of living.
A room for classics and discovery
“The UK remains one of the most mature and competitive wine markets in the world, but there is some exciting development going on for it too,” said Joseph Arthur, chief wine buyer at Marks & Spencer and DWWA 2024 judge.
He noted strong buyer interest in New Zealand Sauvignon Blanc, as well as French and Italian wines, but added: “Portugal's emergence (and) long-awaited success is evidence that customers are also willing to step out of their comfort zones” in Portuguese reds and whites. The wine won several major medals at DWWA 2023.
“Our members love to explore and we are seeing very good growth in regions like Greece and Portugal,” said the wine association's Finlan.
Willard said wine produced from local grape varieties was becoming more mainstream, having been championed for years by independent retailers and specialist operators. “Lesser known regions should not be shy about coming forward with their wines, which will certainly have rich histories and stories to tell,” she said.
“There is stronger interest than ever in artisanal wines that speak to a place, that are easy to drink, and that are not the result of over-manipulation,” said Giles Burke-Gaffney, buying director at luxury wine merchant Giustierini & Brooks. Wine industry.
Invasion of the United Kingdom
“Our purchasing team is always looking for new producers,” Burke Gaffney said. “If we come across a great drop that suits our customers’ tastes, and a wine that has something unique to say about itself, we’re interested.”
Paul Richards, senior buyer at wine-focused members club 67 Pall Mall, echoed that sentiment from a merchandising perspective. “We are constantly adding new wines and producers to the list,” Richards said, noting that the club’s online list contains 5,000 “boxes,” offering 800 different wines by the glass. “We have a great team of sommeliers who (provide) feedback on trends and discoveries that they are keen to share with our members.”
Producers targeting the trade should “engage sommeliers, listen to the winemaker and taste their wine,” he said. The authenticity of their stories and the quality of the glass will always help guide the end consumer to lift the glass.
At Marks & Spencer, Arthur said agents can add value for producers looking to work with larger retailers, “particularly if you are from a slightly specialized region (or) country, or not one of the biggest producers in a particular category”.
Producers have to do their homework on potential partners, Willard said, adding that regional importers can sometimes be a better fit than national-level companies. “Target the right buyers from the importers most relevant to your style of wine…If you are a small natural wine producer, you may not want to target large importers who focus on entry-level, high-volume wines for supermarkets.”
“Use every tool (such as the DWWA Market Guide) to make connections within the UK trade and get your wine in front of the right people,” Willard added.
New DWWA Market Guide
Decanter's new DWWA Market Directory has been created to better connect DWWA Medal winners with suitable buyers, importers and distributors in the UK.
Listings in the DWWA Market Directory will be available exclusively to DWWA 2024 Medal winners, increasing their chances of success in the competitive UK wine market.
For the UK trade, the initiative will offer a Decanter-recommended buying guide for its award-winning wines. Buyers can sign up for the guide here.
How it works
Decanter will distribute the DWWA Market Guide to its network of leading UK buyers, importers and distributors. They will receive basic details, such as previous cellar prices for production volumes, as well as contact information for producers.
This will help facilitate meaningful business conversations quickly and efficiently when a wine is of interest or considered appropriate for a particular portfolio.
Key dates in 2024:
Registrations open: June 19
Registrations close: September 18
The DWWA Market Guide is being distributed to UK buyers: from 1 October
There is a registration fee of £55 per listing on the DWWA Market Directory. Each list comes with one free roll of DWWA medal stickers, worth £55 per roll.
See the DWWA Market Guide webpage for more information, including terms and conditions.
