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Gallo wine boss says UK is toughest market
19 May, 2009
The Gallo VP and general manager for Europe has called the UK the most challenging European market.
George Marsden said three factors make the country so difficult – the economy, health issues and the biggest of all, duty increases.
The vice president said the Government is doing wine drinkers a disservice by increasing duty. He said: “Not only is this leading to no room for investment, the Government is doing a disservice to the wine consumer.
“If people are buying wines for £4 a bottle, you’re paying £2.09 a bottle for duty. So you’re leaving less than £2 a bottle for the glass, shipping, stoppers – and the wine.
“On the bottles that are available in the 3 for £10 deals, the amount left to make wine is pence, we’re not talking pounds.”
Marsden said the company’s strategy is to focus on value and avoid participating in discount deals – even if it means taking a volume hit.
He added: “If we invest in quality, yes there is likely to be a volume loss but over the next two-three years the Gallo brand equity will creep through.”
Gallo brands are available in 23 European countries with Russia as the next target. Carlo Rossi wine will launch into the market in the coming months.
