Drinking wine since Roman times, the UK market for wine is both mature and competitive. Changes happen slowly, and old traditions remain as the market evolves. Katy Keating, Managing Director of Lay & Wheeler, one of the UK’s oldest wine merchants, gives a deep dive into the UK wine market. She explains the history of wine drinking, its impact on wine purchasing, the up-and-coming wine regions, and the fragmentation of the UK wine retail marketplace. Support the show on Patreon!Detailed Show Notes: Lay & Wheeler (“L&W”)Fine wine merchant, storage, and brokerFounded in 1854, after Berry Bros & Rudd (1698), Justerini & Brooks (1749), Corney & Barrow (1780)Owned by Wheeler Family until 2009, when sold to MajesticNever integrated into Majestic, it was a breakeven business doing ~£10-15M/yearHad access to the best wines in the world and a loyal, long-standing customer base2016 - started turnaround to put L&W back on the map2019 - L&W sold to a private family, expanded the team, and brought MWs to buying teamMission - “Connect the right people with the right wines.”UK Wine DrinkingVery competitive and mature market - drinking wine since Roman times, customers know a lot about wine, buying is very relationship-driven2nd largest wine importer (20% from France, Italy)70% of households buy wine regularlyBeer & spirits are also big - pub culture~50% on-premise, ~50% off-premiseCommercial wines - ~75% by volume, grocery stores mostlyFine wine - ~25% by volume, ~40% by value, UK is ~33% of £5B fine wine tradeUK drinker drinks wine more mature (the US drinking 2009s & 2010s, UK equivalent is 1990s, early 2000s)Wine storage is mostly in bonded warehousesPopular regions / varietiesOld world love - history with BordeauxFine Wine - L&W is 40% Bordeaux and BurgundyAppetite for Burgundy is “insatiable” - high pricing has driven renewed interest in Bordeaux and some intrigue with Oregon PNSouth Africa has been growing last 5-6 years (L&W has seen a 50% CAGR over the previous 5 years)Champagne growingFortified wines - Port is most relevant for traditional settings (including Christmas, which is significant in the UK); Sherry & Madeira are not as popularOrganic/biodynamic not asked about by fine wine consumersUK trendsWine for investmentUK wine production - growing overall pie for sparkling, not taking from Champagne (L&W is <0.5% the UK sparkling vs. 10% for Champagne) UK retail market - very fragmentedNo 3-tier system, merchants can buy direct from producers and sell to consumersConsumers need to go to 5-7 merchants to get everything b/c of exclusivity with producers (fine wine)Exclusive relationships often occur when a merchant sells to private clients and restaurantsUK wine trading is standard; L&W gets ~25% of revenue from tradingEn Primeur/Futures - a big part of L&W business for Bordeaux, Burgundy, & ItalyLow end - very competitive on price, grocery dominatesOnline is slow to be adopted, and many still don’t have online orderingDTC from EuropeHistorically, Brits drive to France and buy at the cellar doorIn the UK, buying direct online is not a thingBrexit impact - more paperwork, more delays, hosting tastings and bringing in samples more difficult Get access to library episodes Our GDPR privacy policy was updated on August 8, 2022. Visit acast.com/privacy for more information.