Imported Wine——Sharp Rise in Sales Volume but Inferior Quality

It is estimated that market share of imported wine will further increase to 18-20% in China in 2009. Imported wine is seizing market share in low and middle market by cutting price and increasing sales volume.

   Despite of financial crisis, sales volume of imported wine has achieved record high. Statistic from customs shows that import volume in 2008 has increased by 36% over 2007. By the first half of 2009, import volume of wine has grown by not less than 30%, even 100% in some coastal cities. In many supermarkets and shopping malls of coastal cities, there are special counters full of various kinds of wine. The large import volume is posing an unprecedented challenge to domestic wine producers.

　  It is analyzed that a main reason for this is that tariff is further reduced. From January 1st, 2006 on, tariff of imported bottled wine has decreased from 43% to 14% and comprehensive tax rate has decreased from 85.9% to 48.2%. Considerable reduction of tariff has significantly cut the cost of imported wine, thus improving their competitiveness. Currently, per capita consumption of wine is 0.35 liters in China, less than 1/10 of world average level, which indicating a large growth space. Therefore, foreign wine enterprises have full confidence in China.

Imported wine which used to be very high-priced has reduced price and readjusted products mix to cater to current consumption situation. In addition, relevant departments have issued a series of preferential policies so as to build a convenient and safe platform of marketing logistics.

However, while a lot of imported wine is swarming into China, a lot of quality problems are arising. Quality regulation, price regulation, marketing channels and promotion of imported wine needs to be further strengthened. Spot check shows that the qualification rate of imported wine is low, with 1/3 unqualified. The major problems include excessive amount of preservatives and sweeteners, disorderly pricing, poor after-service as well as customers’ insufficient understanding of wine.

Despite amount and market share of imported wine is rising, no prominent foreign brands has emerged and customers don’t recognize them well. Due to lack of capital and online channels, imported wine enterprises is suffering from the bottleneck in brands building and marketing, which goes against the long-term growth and development of imported wine.