Beverage Bulletin May 2010

California Beverage Retailers Association

P.O. Box 56686

Sherman Oaks, CA 91413

(818) 788-8120

www.cbraliquor.org

 

May 1, 2010

 

Industry Sales News

 

Dos Equis Beer is beating industry figures by a lot. On-Premise import sales for 2009 are down 4%. Dos Equis on-Premise sales of dark up 8.5%, and Lager up 18.3%.

 

Infoscan reports spirits sales figures for 2009 compared to 2008. Total sales are shown in millions of dollars.

Vodka +4.5% $907.2

American Whiskeys +1.3% $572.6

Rum +1.3% $400.8

Cordials -2.4% $342.8

Tequila +1.4% $229.7

Scotch -1.7% $149.4

Brandy/Cognac +.01% $146.4

Gin +.53% $127.4

According to DISCUS the higher priced brands took a beating. High End Brands (above premium) -3.5%, and Super Premium Brands -5.1%. While Value Priced Spirits were +5.5%. Total consumption was up 1.7% or a little more than 3 million cases.

 

Wine figures for 2009 were similar. Table Wines represented 92% of sales or 272.6 million cases. Two thirds were domestic and one third were imports. Domestic sales increased 1.7% and imports dropped 1.1%. Domestic Champagne sales +5.0% and Imports -4.4%.

 

Australian Overproduction

The Australian Wine Industry is concerned about overproduction and inventories that are backing up. A joint study by four major agencies in Australia; Winemakers Federation, Wine Grape Growers, Wine and Brandy Corporation, and Grape and Wine Research and Development Corporation reported a the cuurent production exceeds demand by 20%. Current production is 100,000 cases a year more than can be sold at home and abroad. Worse yet, figures indicate this excess may double in two years. The report says that in order to reach a balance 50,000 to 100,000 acres would have to be taken out of production. More than one sixth of the vineyards are losing money as prices are cut. Early indication are that many growers will be leaving the grapes in the field.

 

Consumer Pricing Study

In a recent report; “The New Value Paradigm,” consumers were asked “Which one of the following practices...gives you the best feeling when you encounter them?”

Free product 30%

Coupons 20%

Manufacturers lowering prices 15%

Advertised sale price 13%

Loyalty card savings 13%

Unadvertised sale price 10%

 

The answers were not surprising. Think about your own reaction to wholesaler deals. Before you say “Wait a minute. I can't give stuff away for free.” Think about it. Which is a better selling price? A price reduced by one third or “buy 2 get 1 free.” Both prices bring in the dollars per unit. But, “buy 2 get 1 free” sells three times as many for three times the dollars. And if it makes the customer happier, why not?

 

State of the Art Winemaking Tricks

Wine is made and aged naturally by centuries old tradition and methods. Right? Well, not exactly. Here are some of the techniques used in today's wine industry. You've heard the terms. What do they mean?

 

Reverse Osmosis is used to lower and standardize alcohol levels. Grapes. may have more sugar and thus produce wine with more alcohol. Wine is filtered through a membrane that allows only water and alcohol to pass through. (The grape flavors and solids don't pass through). Then the water and alcohol are distilled to separate them. Finally, the water and only a portion of the alcohol are blended back into the grape products.

 

Nano filtration is an alternative process that is easier on the wine than reverse osmosis. Yet it is more effective in changing the character of the wine. The filter separates by molecular weight, the shape of the molecule, and its ionic charge. (I don't understand that either. But it works.) This method not only adjusts the alcohol level, but can also remove the bad flavors and bouquet that come from some wild yeasts.

 

Micro oxygenation allows a small amount of oxygen into the aging tank by forcing it through a porous ceramic. The oxygen affects the tannins. The wine becomes smoother and softer and is ready to drink with a lot less aging.

 

Spinning Cone Treatment puts wine through a centrifuge to separate it into its various parts. The heavier compounds are thrown farther out in the centrifuge. The wine is separated into water, alcohol, flavors, and aromas which are then put back together in quantities that suit the winemakers requirements.

 

Oak addition is used in stainless steel tanks to mimic the effects of aging in an oak barrel. Barrel aging is expensive and time consuming. It is much more economical to add oak chips to the wine to add flavor profile. What are oak chips? You guessed it – sawdust! Robert Mondavi would have shuddered at this. He founded his winery just to prove that the right kind of oak in barrels made a difference.

 

How to Use Bottled Beer to Draw Customers

 

Whether your in the restaurant or package store business, bottled beer can be a big draw. Some beer drinkers will search out their favorite brew. Others want to try lots of new and different labels. There are two ways to exploit this hot trend.

 

You can offer a broad variety of bottled beer. Hundreds of brands from all over the world are available. You can pick out a selection of dozens. Then promote the fact that you have a big variety and feature one or two exciting picks each month.

 

Another approach is to specialize in one kind of beers and be the ultimate place to find them. Aficionados will frequent your establishment over and over again to try different labels of the specialty you are offering. What kind of specialty could you feature? Here are a few suggestions.

 

  1. Beer from one country or region. Mexican, German, Latin American, Belgian, Eastern European, or several craft brews from your state or part of the country.

  2. A single type. Ale, Stout, Lager, Wheat, or Dark Beer.

  3. Large bottles. Lots of imports and domestics come in 20 to 25 ounce sizes.

     

Once you become known for your specialty, your customers will keep coming back. If you are selling for on-premise consumption, the drinkers will come back to get more of the same and develop a camaraderie with others who have the same tastes. If you are selling off-premise for home consumption, beer doesn't last long and that ustomer will need to come back and refill the refrigerator.

 

DOWNLOAD A 'BURGUNDY WINES' TRAINING PACK

DOWNLOAD_YOUR_TRAINING PACK

The “Burgundy wines” package, available to download from the pro site at www.burgundywines.fr is the ideal tool to help you present and sell your Burgundy products to your customers. Available in French and English, this two-part tool presents the Burgundy vineyard (its history, terroir, ”climats”, etc.) as well as the special characteristics of Burgundy wines which make them so unique yet universally enjoyable.

 

 

Coming Industry Events

CBRA members are able to attend most of these industry only events for free. Contact the association office for details.

5/3 So. Africa Tasting LA

5/4 Sonoma in the City LA

5/5 Cinco de Mayo (Holiday)

5/6 Wine Warehouse tasting San Francisco

5/9 Mothers Day(Holiday)

5/10 Mexican Mothers Day(Holiday)

5/26 Wine Warehouse tasting Orange County

5/27 Wine Warehouse tasting Century City

5/31 Memorial Day(Holiday)

6/9-10 Unified Grocers Expo Long Beach

 

    Legislation

    Our industry is more controlled by laws than most others. The State Legislature and the ABC give us license privileges and take them away. More than 100 new alcoholic beverage laws have been introduced, passed, and sign by the Governor since this session started. Many critical issues are still pending. Is your business safe? Members are encouraged to look through the Legislative Bulletin. If there is a new law that is a problem for your business, call the association office now. The CBRA is your voice in Sacramento. If you are not a member, join today. The CBRA is your only voice when it comes to new beverage laws.

    Brands and Comments

    The CBRA Newsletter has not accepted any payment from any of the brands mentioned in this edition. The editor, Ron Ziff, welcomes comments at ron@cbraliquor.org

    CBRA Membership Remains Open

    Now, more than ever, access to your industry is important. The CBRA is California's only statewide association of licensed retailers, and our membership continues to be open for the first time in 20 years.

    At CBRA we deal with licenses and regulations that affect the beverage business on a daily basis. That's why CBRA offers practical solutions, unique products, services, information, and timely advice for both large and small beverage businesses. With reasonable fees, superior service, and associates that are easy to reach, CBRA helps you to run your business better and easier.

    California Beverage Retailers Association – We know how to get it done.