Today, in the parlance of the sales world, is the last day of the year. You see, in the wine business, we have this flexible view of the Gregorian calendar, and in order to reach some lofty goals, we have extended 2007 until today. It’s a new-math way to squeeze a little more out of the already hesitant retailers and the almost exhausted restaurateurs, who are entering a busy segment of their cycle for the next 3 months. For the retailers, though, stick a fork in them, they’re done.
It has been a rough, rough December. In my witnessing of the cycle of this wine business, this reminded me of 1990, right before we went into the first Gulf War. It reminded me of 1987, after the stock market crash of October. Also it was the beginning of an election cycle, always a year for conservative growth and sluggish tendencies.
So this is a bit of an industry wonks view, the state of the state of things. 2008 ain't gonna be pretty. Then again I had no idea 2007 would end this well.
December, though, has been the beginning of the downward spiral of the cycle, as I see it. The worrisome bit is, usually the alcohol industry rallies when the economy slumps. People self medicate. Witness the post-Katrina growth of business in Louisiana and New Orleans, especially. I’d drink more if it would make this 12 day headache go away. But that’s another story. The story this time is that people arent rushing to fill their liquor cabinets, in the same way as they used to.
I penned a quick email to another blogger on my way to tango lessons.
It’ll be interesting to see how the year 2007 will be viewed:
- By Italian suppliers
- By American importers
I'm seeing higher spikes in the sales increases, by dollars, than by cases, though only a by 1 percent. However, the sales in dollars, the money we take to the bank, vs. the actual cases, the actual stuff of wine, there is a disparity and it is growing. so while some of the importers will crow about what a great year it has been (not too bad) I wonder what the actual producers will say when they don't see more money in their coffers.
One of the interesting things about the weak dollar is that distributors sell less and make more. More money in the bank, because of the weak dollar? So why cry?
There is still the problem of those cases....and 2008 looming with an election year combined with inflation (we're seeing it out there in the hinterland) and, oops we're sending our illegal workforce back to where they came from....not too good for the restaurant segment.....
It’ll be a year that I'm sure many will be glad to be viewing from their rear view mirrors, from a financial perspective that is.
Gotta go, tango lessons in 30 minutes.... today's winner gets the bombacha...
Already new suppliers are emailing and calling for appointments. I looked at our inventory today and we have as much on order as we already have in warehouses. That would be a response to the price increases and an attempt to load up on already proven items in an attempt to forestall increases to the trade. Buying time by buying on time. Forget about just in time, this time. Roll ‘em in, hope like hell to sell them before the slow moving report sends them to Purgatory (close-out land).
And still more suppliers knock, wanting to get in. Please send 100 more great salespeople and 500 more great accounts. Then let's tawk.
Or, make sure the wholesalers make 30%, the retailers make 40%, and it still looks like a bargain to the consumer. Oops again, we’ve been wal-marted. Thank God wine doesn’t yet come from China in vast quantities. Then again, look at shoes. Or better, try to find a pair of shoes that aren’t made in China. Or ties. Better save your old clothes, get your shoes repaired and trek on over to Italy once in a while for replacements. Made in Italy by Bulgarians, Ethiopians or Chinese, now isn’t that better? Especially for those making them?
So what’s the re-solution, Watson?
Bear down, eyes on the road. Keep it simple, put down the machines. Look the customer in the eye (instead of the computer). Make contact, show commitment, dig in, feel their pain. Carry the load, no quick fixes, win hearts. Dance with your partners, speak the truth and never, never give up.
Feliz Año Nuevo!
Photos: Buenos Aires