possibly one for BJ.. I couldn't resist this, even knowing in advance it would be crap - in the event it was drinkable with a big slug of cassis added. I'm curious however how any producer can knock out something legally called champagne at that price, assuming that there are rules protecting the brand. this was clearly more méthanol champenois than méthode champenoise....
Tesco champagne for £8
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Go on then. Someone did explain it to me once. It's to do with distressed stock and bankrupt would-be brokers.
Typical cost for a decent grower-producer's Champagne is about 14.5EUR. Add to that about £3 duty plus shipping and you are up to about £16. The agent might make around 10% so call that £18. Add the supermarket's typical 22% margin and you have around £22. With VAT that's £26.35 (My cheapest Champagne is £26.) Tesco's "Louis Delaunay" was £25.99 before they dropped it to £8. Remember the name is just a made up one so it doesn't have to be the same wine. This is a negociant's Champagne (bought in grapes - you can tell by the small print on the bottle) so the base cost will be a bit cheaper.
So how can you do Champagne at £8? Well, the starting cost would have to be in the region of 2.5 to 3EUR.
Champagne keeps high reserves so there are few excuses for selling excess stock at below cost. I think that what happens is that a middle-man picks up a batch of poor quality stuff the Champagne house doesn't want to flog under their own name. Or they don't want the cost of keeping it and need the cash flow. The middle-man then punt it about at a silly price and can't sell it so they go tits up. Another wide-boy picks up the stock at an even sillier price and punts it about again. This cycle continues until someone like Morrisson's can't resist the price and buys the lot for next to nowt so they can advertise £9.99. Then Tesco tries to steal market share by knocking another load out at £8.00.
Alternatively Tesco contracts to take as much Champagne as the producer can make over so many years then holds them by the balls and tells them that unless they can have a few containers at fuck all cost they'll tear up the contract. As it's all bottle fermented you can't just quickly knock out a load more but you can buy in unwanted stock from anyone wanting to off-load some old shite they can't get rid of.
There are laws governing the production and quality of Champagne. The pucker Champagne producers frown on this kind of activity quite rightly. ( E.G. this from 2014) It's fucking silly but always happens at New Year. Why de-premiumise a premium product?
Thanks for the explanation. The deals the link referred to seemed to be the supermarkets genuinely discounting, whatever the impact on the brand, whereas for this £8 stuff, starting off with offloading a duff batch seemed more likely. If it harms the image though they'd be better off dumping it in the Marne. Before the smothering cassis went in it had a distinctly bitter after taste, like an office romance or an ill-conceived referendum..
On another tipple - Asda were selling Bowmore 9 yr old for £15 yesterday. It had been at £20 up to New Year and normally sells at £20+. As an Islay malt it's not everyone's taste, but not as antiseptic tasting as Laphroig. In fact probably a good introduction to the Islay malts at that price.
Does any of this apply to shandy?
(btw Mrs Wrenfoe was very impressed with Beau's insider knowledge and has now legged it down to Tesco's. I sense my bank account is going to take bashing)
Ref Spirit prices:
We used to come accross this a lot when I worked for an off-licence chain. Things like Baileys Litres at £9.99.
That's often "Grey market" stock.
Big brands from the likes of Diageo have continuous high production but variable demand so sometimes thay are overstocked. They don't want to be heavily discounted in the UK so they dump stock in places like the Algarve at silly prices. Brokers will get hold of containers and legitimately bring it back into the UK.
In the meantime Diageo want to maintain a premium position. They can't, by law, dictate an RSP but they can offer massive advertising monies which are withdrawn if you advertise below a certain price. The margin is also made up by huge over-riding discounts based on volume targets. If you buy a container on the grey market you lose the volume discount you've already factored in to your costs. It's a difficult balance especially when someone like Bargain Booze breaks ranks and undercuts everyone by £10 a bottle. At that stage Diageo comes under pressure from Tesco/Asda and makes a few consessions.
This is why I don't sell any brands. Tesco can sell them £10 a bottle cheaper than I could buy them direct from the distillery.
Bowmore is owned by Japanese distillers Suntory so fuck knows what's going on here though! Should be about £30, reduced to £20 then to £15! Maybe Asda are deliberately trying to piss Suntory off?
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