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2020 Challenges of the Wine Distributor and Fresh Growth Prospects

Beverage Trade Network breaks down the upcoming challenges of the wine distributor, and how to escape to fresh growth prospects.

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According to the TTB (Alcohol and Tobacco Tax and Trade Bureau), there are 110,000 wines in the USA today, and as per William Sciambi, President of Drewbar Consulting Solutions, 80,000 of these wines are available to the consumers of New York which to him is truly encountered to be “a shocking number”.  With nearly 2700 distributors holding licenses in the USA to distribute wine, these numbers are a growing worry for the wine distributors and the entry of new market players is now only adding to the already overly crowded wine market. For this reason, Beverage Trade Network breaks down the upcoming challenges of the wine distributor, and how to escape to fresh growth prospects:

Oh! Wow! We don’t have a product like that... That, won’t happen!” – Tim Hanni MW

These words coming from a wine veteran, Tim Hanni, Master of Wine clearly indicate the reality backed by the TTB numbers. In a market of endless quality wine, anything surprising about wine will be factors relative to anything other than taste and quality. The challenge for the distributor or a label in 2020 is not going to be quality since that has already been achieved. The market is floating on quality wine, which makes it that much more critical to understand what are the so-called other factors in question, and which one of these are relevant to your wine target market which in itself is a challenge, to begin with.

Stories will sell your wine, not stores

The famous 2017 article that first appeared in Meininger’s Wine Business International written by Felicity Carter, Editor-In-Chief gives an unparalleled insight into “The Art of Wine Storytelling”. She gracefully justifies the act of storytelling itself, and how that relates to the wine world. Her rollercoaster graph which she was able to theorize seems promising, especially in a world where wines are no more a seller for just their taste. A wine that underwent difficulties to come to fruition due to a world war or a wine created by a person that went bankrupt and returned with a banger wine are all stories that sell the wine. If you are indeed looking to market using story-telling, it is always advised to first understand that it must be the truth and not a hoax, since hoaxes bring a wine under suspicion, and with numerous options on the table, a suspicious wine might seem interesting momentarily but wouldn’t be able to hold it up for long.

“I ended becoming a problem solver” – Tim Hanni, MW

What Tim ended up doing made him the problem solver of the industry. He solved the problems of inventory keeping, by creating a consolidated profitable menu which went onto cutting down 8 million dollars of costs of the industry. Wine after wine toppled cellars with preferences of the newly hired sommelier, a problem which neither of the big boys could solve. Tim Hanni scored the big account by mere problem-solving.

It's simple, we propose our wine be sold, since that is a problem only the buyer could solve, and similarly buyers have problems of their own. Solve their big problems, and watch your wine climb their shelves.

Inch by inch

In a city like New York where everyone hustles, you can’t sit on a pile of complaints about being unable to score a big account for your wine distribution. Not every person is going to be able to score that credit, and hence surviving inspite of it, is what will eventually bring attention to your wine. 20 years into the business, Lieber Wines and Spirits began with nothing. Today, inspite of being a medium-sized company, they are well-respected and are known for going from rags to riches with passion being their number one drive. Larry Lieberman, CEO, Lieber Wines and Spirits nearly sounds an alarm in the minds of the attendees of the Alcohol and Beverage Import and Distribution Conference 2019, hosted by the Beverage Trade Network, by reinforcing the example of how Lieber Wines and Spirits still survive by joining inch by inch and continues to set a network of good business no matter how big or small it may be. This trail has ended up making them a name that is simply symbolic of the New Yorker spirit of survival.

Networking is going to be a challenge

“If I am a buyer who likes to read trashy romance novels, go ahead and pick up a book, read a part of it, and go ahead and talk about the trashy roman novel.”, Stephen Fahy, Senior Head Buyer, The Wine Library.

In a place now which is over-crowded with wines for years, there is very easily a possibility that those dealing with them, no longer have the energy to speak about it for long. Everything that was to be discovered, is now discovered, and the market it now bustling with people of an ever-growing crowd. Networking is certainly going to be the most difficult challenge in the year 2020 for the wine industry. In a market where networking has been going on year on year, and very little changes are bound to occur with the product itself, it's only the gap and crevice identifiers that are going to be able to network going in.

Perception counts

As harsh as it may seem, creating a perception in the wine industry is an art of deception.  A wine industry player can always create a perception in the market about his/her wine, provided, it doesn’t fail. Almost becoming a black horse of the wine world and very carefully placing yourself in a bracket of luxury for a certain income group could give you abysmal returns.

Challenges will only grow in a wine market like the ones of the USA, and hence the big standing question that remains is, is survival the only way, or can one look towards bigger and better prospects?

Cannabis Drinks is a market of fresh prospects, and if you feel your wine business has plateaued you could use the same wine-producing line and add the permitted part of cannabis to create an entirely new product under your label. Enter a market that was never imagined to be this big, but with a platform like the Cannabis Drinks Expo 2018, which was packed with people in July 2019, this market is now projected to become a $1.4 billion market by 2023 according to Forbes.

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