Such stories might provide a few tastes of this market but they rely mainly upon atypical examples and feature few local voices, and thus tell us little about who or what influences it most. Then again, in a country with regions, cultures and spending habits as diverse as they are in China, it is often hard to put a finger on that someone or something that touches the whole place. Here is an attempt to do so -- or to at least present ten subjects that might help to understand it a bit better.
Biggest wine company
Whether it’s topping up over 100m bottles of Great Wall per year, buying wineries in France and Chile, running marketing campaigns so big they have included sponsorship of the Beijing Olympics and Shanghai World Expo, or fighting for market share with competitors such as Changyu and Dynasty, the duties of the wine division of state-owned COFCO are vast. So are its political links, which is not surprising, given the company evolved from organizations formed in the 1950s charged with the fundamental task of feeding the country. Expect Wu Fei, the chairman of the division, to continue to build the company’s beverage empire, which includes pushing boutique brands Chateau Junding and Chateau SunGod, cooperating with partners to expand the Zun club and 90-plus retail shop outlets, and buying one or two, or more, foreign wineries. And if Wu can boost the imported wine portfolio – their notable brand now is Pommery Champagne – COFCO will be even more formidable. You would be hard-pressed to find a more influential person in the Chinese wine market than Wu Fei.
Small to medium sized winery
When it comes to quality wine in China, Grace Vineyard in Shanxi Province is widely deemed the success story of the millennium. Grace’s first vintage was 2001 and its wines are now found in five-star hotels, top-end restaurants and boutique wine shops, with Torres handling most distribution and the winery having a few outlets of its own. CEO Judy Leissner heads the operation, which was co-founded by her father in 1997. As competition increases from the likes of Domaine Helan Mountain, Silver Heights and Jia Bei Lan, Leissner has been busy with projects of her own. These include operating vineyards in the neighboring Shaanxi and Ningxia regions, hosting Torres’ wine makers from Spain to jointly produce a Muscat, and experimenting with screw caps. In fact, there is a good chance this year’s entry-level wines will be twist off, which would be a bold move in a nation where cork rules and show Grace Vineyard is willing to take the lead.
Wine distributor
There are distributors with bigger operations, such as Aussino, ASC and Summergate, while others are more nimble, like The Wine Republic with its on-trade focus. But here are just four things that help give Torres China’s general manager Alberto Fernandez an edge. First, Torres boasts wines from some 15 countries, including the recent addition of Pisano from
Uruguary. The brands are not run-of-the-mill. The Australian portfolio, for example, includes Henschke, Grosset and De Bortoli, among 15 brands. Second, Torres has a niche in that it represents arguably the two best Chinese brands, Grace Vineyard and Silver Heights, and has the latter on the wine lists of five major hotel chains. Third, Torres has pushed into retail in the past few years by revamping its on-line ordering system and opening a series of shops and spaces in retail outlets, which should total 23 by year’s end, all under its Everwines brand. Finally, Torres retains staff like few others, with many employees on board longer than the average distributor has even existed.
Wine maker
From Shao Xuedong at Chateau Junding, a COFCO-invested operation in traditional wine region Shandong, to Emma Gao at the tiny family-owned Silver Heights in up-and-coming Ningxia, China has a wide range of wine makers. But no one bridges the past and future like Gerard Colin, managing director of CITIC-Lafite, who came to China’s wine industry from Bordeaux. At the turn of the century, he helped put Grace Vineyard on the map and make it the first Chinese operation to consistently put out a decent portfolio of wine, now under the direction of Ken Hutchison. That’s the past. The future is the CITIC-Chateau Lafite project in Shandong, where Colin serves as managing director. Expectations are high, with the first wine slated as early as three years from now. Colin has a tough job ahead of him, given untimely rains in this region, and has invested much time analyzing the soil and growing seasons to get the most of the vineyard in a country where the Lafite brand is the best-known.
Wine bars and clubs
There are plenty of major wine importers in China, from ASC and Summergate to C&D and Links Concept, but Aussino is unique in that it builds influence through its branded bar and retail outlets. The company, founded by Robert Shum, boasts more than 200 of these outlets, which range from ‘Aussino cellars’ that blend bars with retail space to ‘Aussino corners’ that might simply be a kiosk or stand in a department store. The company has plenty of product with which to stock them, claiming more than 1000 wines in its portfolio, from Champagne Philipphonnat to Wirra Wirra to Santa Ana, as well as distribution in more than 100 cities. The best visual evidence of this reach is Aussino’s quarterly magazine Wine Life, with its coverage of its own wine dinners and tastings across China, many in cities the average person outside the country has likely not heard of. Chateau Teyssier dinner in Dongguan, anyone? How about a Santa Margherita tasting in Yiwu, or a Tesseron Cognac one in Huizhou? Aussino and its network of bars has the reach to organize them.
Wine personality
Many first heard the name Li Demei this year, when Decanter magazine awarded the first ever International Trophy for a Chinese winery, Helan Qing Xue, where he is chief consultant. For those in China, Li has been a fixture for years. A graduate of Enita de Bordeaux, with a stint at Chateau Palmer under his belt, Li’s main position is as professor at Beijing University of Agriculture. He heads a decades-old wine appreciation class there and has also taught at the Beijing branch of CAFA and trained wine makers in detecting faults. Despite this busy schedule, which includes participating in industry associations, he takes time to interact with his more than 185,000 followers on the social media site Weibo. He also consults at two wineries in Xinjiang; he calls one of them his “dream project” and says it has the potential to produce China’s best wine yet.
Government agency
Few things can elicit a primal scream from wine importers as easily as China Customs. The issue is not so much that tariffs and taxes on most wine imports total some 48%. That number is fixed, a given for importers to plug into business plans, and a reality faced by everyone. The issue, say distributors, is that customs rules might be interpreted five ways, depending on whether you bring your wine to port in, say, Shanghai, Tianjin, Xiamen, Ningbo or Yantai. Given this, you might call customs “a national agency with local characteristics”. For importers, that can mean delays in getting the wine – and it also means hoping the bottles are in good storage while they’re held up. Importers also constantly face new rules or interpretations of rules, and need to devote staff just to provide the required documents. To be fair to the people at China Customs, the amount of wine entering the country has rapidly and steadily increased for over a decade and it is but one of many products that must be handled.
Online retailer
There are no shortages of places to find wine; hypermarkets, supermarkets, convenience stores, specialty shops, restaurants and bars are all within reach of consumers. But people are discovering wine in the virtual world, where web site YesMyWine is leading the way. YesMyWine is a Shanghai-based business-to-consumer site that has two temperature-controlled warehouses in Beijing and Shanghai, along with normal warehouses in Chengdu and Guangzhou. The company has 3.5m regular customers and, according to technode.com, has with a monthly sales volume of over RMB10m ($1.5m) and a forecast sale volume of over $30m for this year. Earlier this year it, media reports say it received a further $40m in financing, which will be used to improve warehousing and increase the wine offer.
No doubt, some will be sceptical of the company’s claim that it sells 10,000 bottles per day. When three distributors were asked for their thoughts, one seemed unimpressed, one said YesMyWine had become his biggest customer within three months, and one said the site was “very aggressive”.
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