Wine Imports Increased Significantly Lower Prices By The Curb Profiteering Phenomena

Submitted by: Himfr Paul

According to China’s commitment to the WTO from January 1, 2005, the import of wine except cider, perry, mead and other fermented beverages, wine, distilled spirits, liqueurs and other wine tariffs are 10% -30% , the biggest decrease of 36.7%. Customs statistics of personnel, with the expiration of tariff protection, more wine will flood our country, change will be followed by a decline in wine prices.

The industry believes that with the decline in wine prices, wine prices in the market more transparent, and as wine brand, increase the problems faced will all be exposed.

It is understood that prior to accession to WTO, China’s wine import tariffs of 65%, after accession to the WTO tariff rate all the way down, stimulating imports increased significantly. China’s wine imports of Guangdong port was one of the main ports, according to the Guangdong Customs statistics, from January to October this year, the Guangdong port import 11.392 million liters of wine, valued at 18.329 million U.S. dollars, respectively, over the same period last year, up 20.4% and 40.4%, currently imports close to the year 2003 imports.

Customs statistics show that Spain, France, Australia, the main origin of imported wine, this year account for 84.1% of total imports, imports of wine from Spain which accounted for 69.61% of total imports; from imported types perspective, distilled liquor, cutlery other types of wine this year, imports accounted for 89.2% of the total; imported 123 tons of wine, accounting for 10.8% of total imports.

With the increase in the number of varieties is also increasing. According to one official said southern wines, wine into the night this year? Sodium separation first dark strider? 0% or so.

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With the large number of wine into China, consumers are most concerned about the price of wine. Association of Chinese wine books that high U.S. tariffs will decline more competitive, the price of wine will naturally decline, however, because the flow of wine on the market now or in high-tax wine (sales of a stock), markets should have a digestion process, the time lag of about six months to one year.

Martell charge of public relations, said Wang Jue, even if tariffs come down, market prices will not happen, “dive” type of change. Because wine prices by too many factors, not only means a tariff. Wang Jue told reporters that Martell is produced in Europe, the euro exchange rate a great impact on product costs, the recent sharp appreciation of the euro against the dollar, the cost of Martell will increase the number of invisible, plus up to 25% of China’s consumption tax, the product into the After China, there is not much in price advantage. Taken together, can be said that the shift. From another perspective, the wine consumer base end positioning and price changes in consumer behavior on their little effect. Therefore, the wine’s price will come down soon, is not determined by the manufacturers, but the result of market regulation.

With the decline in tariffs, wine prices were falling, the average decrease of 10% -30%, the price more and more transparent. According to informed sources, one from Australia, the wholesale price of imported wine in the bottle before about 500 yuan, and now only sell to more than 300 yuan. In addition, due to the growth of imports led to price transparency, before purchase price of 30 yuan -40 element of wine, the market price of almost 200 -300 yuan, and profits as competition intensifies the phenomenon of being the market stranglehold.

Despite the decline in tariffs on wine to enter the Chinese market, save a lot of “tickets” fees, but the problems faced by new entrants to the wine brand Quedui posed a severe challenge.

First, the wine market is not standardized access to the wine to bring some difficulties. It is understood that the current alcohol market has not written a single law to regulate the market, each with different areas of foreign policy, some provinces serious local protectionism, lack of transparency, foreign investors set up high on the “threshold”, the competitive environment is not equality, foreign need for a process of understanding the local market, an increase of time cost; In addition, the management of the Chinese wine market, too, in some places of China Wine Association, some places are Monopoly Bureau, even some places in the Business Bureau tube, in the end who control, not the same throughout, so a lot of wine increased the difficulty of access; last point is complicated procedures wine into China, first application, then go through several departments of the audit, and sometimes do not know the to which department of the trial with his words, very long time to reduce the efficiency.

Second, the wine marketing and pathways in the operation takes a lot of costs. Consumer promotion spend a lot of time for brand promotion, the new companies coming in are not high profile, have some time to cultivate the market, many of the terminal stores the wine brand, consumers in the end how to choose; Secondly, the operation of the channel , the manufacturers can not directly operate terminals, go through third party (the declaration the company) to promote the sale to wholesalers, then to the terminal (nightclubs and stores), all kinds of promotions through several links in the recent.

Finally, the wine directly into China will face fierce competition from China’s wine brands, how brands need to go quickly recognized by consumers for a longer road.

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