The question of price frequently arises- as we watch with astonishment, the adverts from the discount supermarkets promoting bottles of wine at £3.79.
How can wine be so cheap? The simple answer is that the supermarkets use these cheap offers as loss leaders to encourage customers into store and hopefully spend on other things.
The basic economics of wine production simply don’t allow for any decent bottle of wine to be sold at this price. Let’s take a look:
A bottle of wine at £3.79 includes VAT (20%). Removing that from the final price leaves £3.18. The government’s excise duty on all bottles of still wine (regardless of the end retail price) is £2.68 currently, so that leaves 50 pence (seriously!) to cover:
Fifty pence to cover all that! The likelihood is that only 10 pence of that is actually the cost of the wine in the bottle sold at £3.79
In comparison, taking a bottle of wine that retails at £11.99; after VAT and excise duty, there is £7.31 left to cover everything shown above -the wine in the bottle is bound to be of a better quality.
The smaller producers, with whom GWO work, all take great pride in their wines – which you will see when we speak to them in our tastings. The care and the attention they take, and the love that they pour into every bottle is clear, as we hear them speak passionately about their products. We know that the quality of the wine they produce is outstanding. So for me and most of our customers, we would rather drink a bottle of good quality carefully produced wine than an unbelievably cheap bottle of mass produced wine. Cheers!
