Richard Hemming MW asks: what’s the next step for indies?
In the not-too-distant future, when all humans are born with inbuilt VR headsets and Trump is Supreme Commander of the Known Universe, how will students of wine look back on the present era of retail in the UK? And, in such a dystopian world, why would anyone care?
Granted, it’s not the most pressing matter, but it does seem that we are on the brink of a new chapter of wine retail in the UK. In less than 100 years, it has evolved from specialist merchants to mainstream supermarkets, and has witnessed the rise and fall of high street chains, the beginnings of online wine shopping and the golden age of the indie. So what happens next?
Specifically, what will happen to the independent wine merchants who have thrived in the past 10 years. Do they continue to expand? How much bigger can they get before the business model has to change? Can they stay profitable as taxes increase and exchange rates weaken?
To get some answers, I asked some well-established indies for their thoughts. Lea & Sandeman has four branches in west London, and director Charles Lea says: “Finding the right sites is key. I am continually amazed at how many companies seem to be prepared to take on leases in the current environment [...] without seeming to feel the need to make any kind of profit.”
Ruth Yates of Corks Out agrees that “finding the right outlets is
difficult in terms of location and size”. Her initial ambition is to grow
from five to 10 shops, although she says: “While there isn’t a ceiling
on number, I don’t want to grow outside the north west as there is a
risk in being national. Smaller and more controllable is where we want
Borough Wines, which already has nine of its own retail sites, has also opened 20 concessions in other shops. This model comes “without the associated investment and risk involved in opening our own shops”, says communications manager Caroline Doyle, while still allowing it greater reach. “We are set up for growth, but the strategy is definitely gradual evolution.”
While expansion might bring greater visibility, certain cost efficiencies and ultimately increased profit (hopefully), the drawbacks of expansion are unavoidable – and age-old. Finding the right staff and managing stock are the principal issues.
Lea says there is a point at which the increased need for stock means you can no longer work with smaller estates, so “you’d get progressively pushed into the arms of the bigger producers, and so into competition with the really big retailers”.
Yates and Doyle both mention the difficulty of recruiting as a major problem for new sites – especially in the post-Brexit era.
Despite all these drawbacks, as well as growing anti-alcohol rhetoric and the boom in craft beers and spirits, independent wine retail in the UK is the success story of the current era. Sustaining that success is the challenge of the next one. Whether or not expansion is the right option, I sincerely hope that independent retailers will continue to flourish – no matter how dystopian the future might be.