Sherry amour

16 April, 2010

Sherry sales have been gradually falling for some years, so it’s no surprise to see volumes have dropped? 7% to 13 million litres in the year to? October 31, according to the latest Nielsen figures.

But over the same period value sales remained flat at Ł93 million – an improvement on the 3% and higher rate of decline they have been seeing over recent years.

While many of the biggest and best-known brands are suffering from an ageing – even? expiring – core customer base, some smaller companies are finding they can do well in spite of the drink’s downward trend and even the recession.

Fernando de Castilla makes top-end aged sherries and this summer its Antique Palo Cortado won Best of Show in the wine category at Spain’s New Wave Spanish Wine Awards, run in association with OLN.

Tony Brown MW, product manager for the bodega’s importer Boutinot, believes there is a reliable, if small, market for the wines. “Niche is the key word,” he says. “That part of the market seems quite robust – our sales this year have been holding up very well.

“For us and for lots of people out there the top-end and even middle-range wines are suffering quite a lot this year, but in that range the PX does particularly well, and we sell good volumes of the antique oloroso, antique? amontillado and antique palo cortado.”?Boutinot has not done any official research into the customer profile of Fernando de Castilla’s wine consumers, but Brown believes they tend to be younger and more experimental than the average sherry drinker.

“Certainly it is people who are very adventurous and like to try different things, rather than the traditional sherry drinker,” he says.

Market forces?Mentzendorff recently won a listing for Bodegas Hidalgo’s Oloroso Ańada 1986 in Harvey Nichols. Marketing director Elizabeth Ferguson says: “This supports the case for these styles to be hand-sold in the retail sector. The benefit here is that with wines of this age, once open they keep well for around four weeks.”?Michael Hall, who imports Lustau’s sherries, has noted a growing interest in better-quality wines.

“The off-trade is polarising,” he says. “It is a sign of the times that 80% of sherry is sold through the big supermarket groups. I think the specialists can be criticised to an extent for being rather slow in developing the specialist sherry market.

“In fact, it’s been supermarkets who have taken the lead.

Rather than slavishly copying the supermarkets, specialists should be developing that trade. They can’t compete on the cheap own-label sherries.”?He adds: “It is a very interesting market at the moment. Although sherry sales are slightly down, the market is still very large indeed, and one which I think could develop again, particularly with the interest in fine quality.”?Harveys, with new distributor Maxxium UK, is focusing on its Very Old Rare Sherry range. Senior brand manager Jane Wilson says: “It will appeal to more discerning sherry drinkers who are looking to trade up and enjoy some intense, older wines. They are packaged in 50cl bottles as they are rich wines designed to be consumed in small quantities. The smaller bottles will ensure the sherry stays fresh once opened and make the price point of these expensive wines more attractive.”?Specialist knowledge González Byass UK’s limited allocation of age-dated sherries can be found in Waitrose, some Sainsbury’s, independents and the on-trade.

“It’s very difficult to say whether they are doing well or badly – they just trek along,” says marketing director Jeremy Rockett. “One of the biggest problems we have is that we don’t have unlimited supply, so we can’t push them too hard.

“For me, independent retailers seem to be having a resurgence and the Nielsen figures seem to be supporting that. There is a group of consumers who have a high engagement and high interest in wine and drinks, and they are always going to be looking for something different, something new, and information.

“They are looking for a place where they can have a high involvement in the purchase and that could be online – because the amount of information you can provide online is almost endless. That opportunity is being taken up by independent retailers, but also Majestic and Oddbins – real high-quality specialists with highly trained, highly motivated staff who are there because they love wine. That is where you are going to sell small parcels of interesting wines and 30-year-old sherries.”?Online retailer has recently promoted all its sherries, and finds they have a small but devoted following. Managing director Tim Francis says: “The aged sherry market is quite a niche market but with a very loyal? fanbase.” He has had success selling GB’s 30-year-old sherries? and believes there is also a market for vintage wines.

“?At present this is an under-developed market with lots of opportunity for growth, as there is little consumer awareness of vintage sherry compared with vintage port, and we believe that assists in finding such gems?. They are otherwise only to be found in prestige retail outlets or top-end restaurants,” Francis says.

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