Wine Business Solutions 2016 On Premise report lifts the lid on the UK on-trade.
If anyone was in any doubt about the scale, power and influence that Conviviality now has on the UK on-trade, they only need to look at new research published this week by Wine Business Solutions.
Its annual On Premise UK report in to the main trends driving the sector highlights how much of a grip Matthew Clark, which was acquired by Conviviality in October 2015, now has on wine lists across bars, pubs, hotels and restaurants.
It shows that over the last year it has grown its share of wine listings to over 17%. Meaning nearly one in five lists in the UK is in the hands of Matthew Clark.
Report author: Peter McAtamney
The figures, which have been released exclusively to The Buyer to help trail the new report, demonstrate how far Matthew Clark has been able to use its position within Conviviality to rubber stamp its influence on the sector. They also don’t take in to account the share that Bibendum, which also became part of Conviviality in May, also has of the UK on-trade.
Peter McAtamney, principal of Wine Business Solutions, told The Buyer: “The research shows that Matthew Clark is the clear leader is all regions of the UK except Northern Ireland.”
He added: “It is Matthew Clark’s ability to cover all major on-premise opportunities that makes them compelling as a partner.”
Matthew Clark has worked hard over the last year to better segment its offer and, in particular, bring in more prestige and fine wines, as well as exploring new countries, like Greece, to make its offer and service more attractive to the premium on-trade.
It has also been able to use the support of Conviviality to put in place long term partnerships with flagship restaurant and bar groups that go beyond just providing them with their drinks. From consumer demographic and sales data analysis, through to hosting special events and tastings through to support with new services and equipment, Matthew Clark has been looking to cover all bases.
Matthew Clark has worked closely with the team at M Restaurants
It has, for example, worked very closely with M Restaurants in London to help develop its drink offer and source wines that may not be part of its main portfolio.
Each contract acting as a halo effect to hopefully bring in other premium restaurants, bars and hotels. All of which, no doubt, contributed to it being named Wine Importer of the Year at this month’s International Wine and Spirits Competition.
In its end of year financial trading statement to the end of April 2016, Conviviality confirmed the impact its acquisition of Matthew Clark has had on the business in just seven months, with sales up 4.9% on the same period the previous year. It had also increased the number of outlets it was supplying by 2.9% since acquisition, and its numbers of customers it was working with was also by 2.9%.
Majestic performance
Wine Business Solutions also singles out Majestic’s on-trade and wholesale arm as having made a significant impact on the sector in the last year. Which will be a boost to a part of Majestic’s business that has been under the microscope since it reported disappointing half year figures inSeptember that were only 1.2% higher than last year at £23.4m.
Its sales may not be hitting the heights it wants, but its share of listings is, said WBS. It describes Majestic as “cutting a swathe through the UK on-premise” market. As McAtemney told The Buyer: “From virtually a standing start 12 months ago, Majestic now controls 5% of all listings in the UK. Customers clearly prefer their model to most of the established distributors.”
It will be interesting to see how far Majestic can push its share of listings in the year ahead as long promised changes, particularly within its internal processing, and supply chain procedures, are put in place over the next 18 months.
WBS clearly believes it has an offer, and an approach to wine wholesaling that on-trade customers like, compared to its competitors.
But equally Rowan Gormley, Majestic’s chief executive, is not going to push or rush changes on its wholesale side. He stressed, earlier this month, on the back of its latest sales figures that he claims puts the group back on course to hitting £500m sales within a three-year plan, that the on-trade side is under review. Gormley said: “The simple reality is that we have projects with higher returns which need to take priority. So in the meantime we are reducing our growth ambitions and simplifying the operation to ensure we look after the customers we have,”
Top countries
In terms of individual countries’ performance in the UK on-trade, then WBS points to Spain, Italy and Argentina as being the three big winners over the last 12 months
“The styles that UK restaurants are preferring are clearly changing and that is clearly favouring Spain and Italy in particular,” added McAtamney.
The full report goes on to determine:
- Who the best distributors are.
- What the most listed brands are.
- What styles are driving growth.
- Pricing in the by country, region, wine style and product format.
- How much money can be made from on-premise sales.
You can buy the full report from Wine Business Solutions priced A$495 by clicking here.
