Wine in China: It's an honour

By / 14th of March, 2014
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GUY and Liz Adams of Brothers in Arms in Langhorne Creek describe the traditional Chinese wedding they attended as “amazing”. But Liz says the unique circumstances surrounding the occasion in Changzhou held the real significance.

“One of our first customers in China employed a young man called Ada who had become a great friend and when he announced his engagement our children were asked to be part of his marriage,” Liz says. “It was a fantastic experience and a wonderful insight into Chinese culture.”

Brothers in Arms is doing well in China and Liz says a relationship going beyond just business is the key. “They take time to establish, but once the relationships are good, then business is generally sound,” she says.

Guy adds, “Many wineries become complacent in maintaining and managing relationships. Anyone working successfully in China knows that doing business there requires time, energy, enthusiasm and respect.”

A complex and diverse wine market, China has exploded in recent years and is experiencing the highest wine consumption growth rate in the world. “Their will to become westernised is the biggest driver,” Guy says. “Wine as a luxury product is bought for celebration, status, enjoyment and friendship and needs to be marketed on that basis. The entire food and wine experience is imbedded into the Chinese culture.”

Guy says the days of an easy sale are gone as the market matures. “It was once the answer to falling margins in traditional markets and a dumping ground for exporters, but Chinese buyers are becoming far more educated and their expectations of quality are rising – and so are the price points,” he says. “This is what’s provoking fierce competition among winemakers wanting a share of the market. We only sell something there we believe is providing value for money and is showcasing what we can do as a winery and vineyard. Our intention is to build long term business connections so consistency and quality are the key drivers.”

Brothers in Arms has had someone based in China for a few years who has a good understanding of Chinese businesses and strong communication skills. “There is huge value in having someone within the business who is able to translate accurately from a knowledgeable background,” says Guy, who’s seen terrible mistakes made by companies. “It is very easy to offend or lose business through poor translation.”

Attending Wine Australia road shows and big wine fairs has been vital for the winery in maintaining a brand presence for its core Brothers in Arms products. At the same time the business has developed a flexible model which includes private label orders. “It’s been successful for us and we believe we do it well,” Liz says. “Supplying private labels has a number of positive benefits for ourselves and our customers, who are mostly family businesses building something for their children. By owning their own brand they are more invested in growing that business in the longer term. That is beneficial to us, as growth follows and our sales increase. Also, these customers have full control of their pricing and that has no impact on our core Brothers in Arms range. “Something I particularly enjoy with the private labels is the relationships we’re developing with these families. Maybe one day our children and theirs will do business together. It’s a long term prospect.”

Guy spends a lot of time in China and has recently been to Fujian on a South Australian Government trade delegation. The focus was on food safety and our clean, green credentials. “We don’t appreciate how big an issue food safety is in China,” Guy says. “The opportunities to develop trading relationships based on products with sound, traceable provenance are huge.”

Liz says Chinese consumers are increasingly seeking genuine products from a winery with a story – not a virtual business. “They want to know they’re getting a consistent, good quality wine with a story, and we like to share ours,” Liz says. They spend a lot of time with their customers when they are visiting Australia, sharing the spirit of the family’s tradition and also adding to their knowledge and understanding of the wines they are buying. “Good wine education will be a growth market in China over the coming years,” Guy says. “As an industry we need to engage in this field and ensure the best information is available.”

 

This article originally appeared in WBM – Australia’s Wine Business Magazine. 

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