Hong Kong and China Feb 2017

p2-s2-gavinThe news feeds are awash with China so I took the time to meet with experienced “China hand” Gavin Jones from the Hong Kong based Jebsen to get his views. They are one of the original colonial trading houses of Hong Kong, with a very contemporary view of Asia today.

After years of distributing major brands they have entered the market with their brands. Twinwoods Estate in Margaret River with a 50 acre vineyard and Kalamanda in McLaren Vale. They are also partners in Sacred Hill in New Zealand,one of the largest independent groups in New Zealand.

Gavin reports the China market is 50 million cases of imported bottled wine market today and obviously growing.

On top of that China produces 100, 000,000 cases of domestic wine which is comprised of bulk imported wine.

  • Bigger bottled wine market than the UK
  • Currently half the size of the USA bottled wine market.
  • France is number one in sales

Australia is the hot category now thanks to factors beyond the recent CHAFTA tariff reduction agreement which he believes “is not the biggest driver.”
Gavin’s sees our strength as

  • Shipping time
  • Similar time zones
  • Style of wine as all wine in China is drunk with food
  • Fruit forward soft that suits the multiple dishes on the table.

Penfolds leads the way by reputation providing an umbrella for all of Australia and the concept of Grange helps the tiered ladder brand approach.

With Penfolds the customer feels whatever tier he orders he is going to be safe. Paving the way for the rest of Australia.

On the down side the Chinese sense of Australian regionality is vague. Barossa is known but any detailed regional understanding is vague.

He sees plenty of opportunity for Coonawarra and Margaret River brands

On the subject of closures he says “5 years ago screw cap was unacceptable and gatekeepers prepared to pay a premium for cork finished bottles. However in the last 2 years lead by the banqueting business screw caps have become widely accepted.” To Gavin this represents market maturity.

Hong Kong is a mature market today with China’s most knowledgeable consumers. They import 4 m cases.

The market has price transparency and excellent wine knowledge, in fact some of the happiest wine drinking in China.

Gavin thinks the range of wine available there is wider than cities in the USA or U.K because of entrepreneurial approach by locals.