The Swiss Wine Market. Copyright mettler vaterlaus GmbH Frohburgstrasse 101 CH-8006 Zurich

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1 The Swiss Wine Market Copyright mettler vaterlaus GmbH Frohburgstrasse 101 CH-8006 Zurich 1

2 The Swiss Wine Market 2

3 The Swiss Wine Market Key Figures Surface: km2 Inhabitants: (23 % of foreigners, approx. 2 mio.) Medium household income (2.3 persons) CHF (= approx. EUR 8.000,-) Average household expenditure for food and drinks: CHF (9.5 % of the income) Average household expenditure in restaurants: CHF (6.5% of the income) Consumption per capita: Mature and saturated market: Almost liberalized market: 36 liter People tend to consume less quantity but higher quality to more expensive prizes. In order to introduce a new wine another wine needs to be replaced. since The annual quota is very large and never exhausted. (Source: Bundesamt für Statistik) 3

4 The Swiss Wine Market One country different markets German speaking part (67 %) French speaking part (24 %) Italian speaking part (8 %) Romanch speaking part (1 %) 2 Soft concentration in urban areas: The Swiss population tends to urban areas. Beside Zurich (1 mio. inhabitants including agglomeration) there are no large cities. 1. Zurich: inhabitants 2. Geneva: inhabitants 3. Basel: inhabitants 4. Bern: inhabitants (Source: Bundesamt für Statistik) 4

5 The Swiss Wine Market Switzerland a wine producing country Switzerland produces about 101 mio. liters of wine per year. Half of the production is white wine, half is red wine. 82% of the production comes from the French part of Switzerland. The most important cantons are Valais (39%) and Vaud (30%). The German part of Switzerland produces about 13% and the Ticino 5%. (Source: Bundesamt für Landwirtschaft) 5

6 2. Wine 2. Consumption The Import Swiss market Data

7 Wine Import Total wine imports in volume (in mio. liters) mio. liter From 2012 to 2013 there was a decrease in volume of 3 %. (Source: Bundesamt für Landwirtschaft) 7

8 Wine Import Wine imports by origin in terms of quantity (in mio. liters) Italy France Spain South Africa Portugal USA Germany Australia Chile Argentina In 2013 these 10 countries represented 97 % of the whole imports of wine in terms of quantity. (Source: Bundesamt für Landwirtschaft) 8

9 3. Consumption 2. Swiss The Consumers Swiss Data market

10 Consumption Data Wine consumption by target groups (in %) all 81% Men 83% Women 80% years 72% years years 60 years and more 83% 84% 84% 65% 70% 75% 80% 85% (Source: Schweizerische Weinzeitung) 10

11 Consumption Data What kind of wine people consume (in %) 50% 45% 40% 35% 30% 25% 20% 15% 44% 44% 40% 36% 34% 34% 26% 20% 22% 33% 21% 46% mostly Swiss wines Swss and foreign wines, balanced relation mostly foreign wines 10% 5% 0% (Source: Schweizerische Weinzeitung) 11

12 3. 2. Consumer Swiss The Consumers Swiss Data market Distribution Channels

13 Distribution Channels Swiss importers by import volume (Source: Schweizerische Weinzeitung) Liters / year N companies more than Less than Total

14 Distribution Channels Structure of the distribution Big concentration in the 2 major retail chains: COOP and DENNER Weakening of the big and medium size companies. The number of companies is reducing. Increasing atomization of small companies. There are 2500 importing companies, many of them very small. Crosses between distribution levels: There are only few importing wholesalers that do not work as retailers. The same happens to retailers who import directly. Absence of strong hard-discounters. Due to the purchasing power of the market and the high fix costs (salaries, rentals, etc.) hard-discounters do not have the same weight as in other neighbouring countries. Aldi and Lidl have entered the market and are doing quite well. The entrance of these competitors has not leaded to a drop in prices as it was expected. 14

15 Distribution Channels Coop and Denner Store check Gazela CHF 6.25 Casal Mendes CHF 5.35 Solar de Serrade CHF Casal Mendes Rosé CHF 4.95 Mandos CHF 5.25 Messias CHF

16 Distribution Channels Coop and Denner Approx. 40% market share for wine wine positions in the assortment 30 35% sales margin General conditions: annual subsidies for marketing promotions Consumers tend to buy the wines they know Little shelf-space for Portugal Most of the white wines from Portugal are from the Vinho Verde region. Most of the Vinho Verde wines are in the lower price range 16

17 Distribution Channels The 11 big importers in terms of volume (2 to 10 mio. liters) Except Aldi and Lidl they are all wholesalers. (Source: Schweizerische Weinzeitung) 17

18 Distribution Channels Importers of a medium size in terms of volume The number of importing companies of a medium size volume (0.5 2 mio. liters) has been declining in recent years. Almost all of them also act as retailers. They sell wines in the medium and high price range. Usually you will not find many wines for less than CHF 10.- These companies make up the big group of medium size importers of quality wines. Examples: (Source: Schweizerische Weinzeitung) 18

19 Distribution Channels Importers of a small size in terms of volume The biggest part of the importing companies is in this group. Some 100 companies import more than liters and another 140 companies more than liters per year. About companies import small quantities. The total amount of their imports does not reach more than 3% of the total imported wines. They are independent retailers or restaurants that import directly. Usually they import niche products from small wineries. (Source: Schweizerische Weinzeitung) 19

20 Distribution Channels Suppliers of the HORECA channel Cash & Carry This type of channel is directed especially to restaurants of a low or medium-low segment or to those whose fundamental criterion for the selection of wine is the price. The leader of this group is TRANSGOURMET, a joint-venture of Coop with the German group Rewe. The wines sold in this channel are other wines than the ones sold in the COOP supermarkets. Importers wholesalers specialized in premium and super-premium segments: They are suppliers of foreign wines for the premium gastronomy. Most of them are part of the medium size group ( to 2 mio. liters). In general it can be said that a wine that is in the supermarket channel will never enter the HORECA channel! 20

21 Distribution Channels Portuguese importers and traders There is an important number of Portuguese importers and traders of a medium and small size that are working in Switzerland. Especially Vinho Verde wines are mostly imported by these companies. Some examples: Sousa Vins Dorimar Vinodor Casa Lusitania Kastas Porto do Vinho Casa Algarve AMD Swiss Antunes Fernandes Cave Cristal Covin Portwine Shop Lusa 21

22 3. 2. Consumer Swiss The Consumers Swiss Data market Market Opportunities 4. Distribution Channels

23 Market Opportunities In which foreign countries Portuguese people were living In mio. people born in Portugal were living in other countries. (Source: pewglobal) 23

24 Market Opportunities Vinho Verde Exports (in liters) 5'000'000 4'500'000 4'000'000 3'500'000 3'000'000 2'500'000 2'000'000 1'500'000 1'000' ' The main export countries for Vinho Verde are countries with a big Portuguese community. (Source: CVRVV) 24

25 Market Opportunities Vinho Verde on the Swiss market - Vinho Verde exports to Switzerland have been multiplied by five since In 2013 they reached the record of a little more than 1 mio. liters. -Switzerland (8 mio. inhabitants) is the sixth most important export market for Vinho Verde behind USA (316 mio.), Germany (80 mio.), France (66 mio.), Brasil (200 mio.) and Canada (35 mio.). -Switzerland hast the highest per capita consumption outside Portugal. -Within the last ten years the average price per liter has dropped from CHF 3.30 in 2004 to CHF 2.66 in In 2013 there was an increase to CHF 2.83 per liter. - The average import price per liter of Vinho Verde (CHF 2.83) is still much lower than the average price per liter of white wine (CHF 4.80) (Source: CVRVV) 25

26 Market Opportunities Target groups Young people The Young love fresh, fruity easy-drinking wines. Their taste is influenced by sweet softdrinks. The price is important but not decisive. Other important criteria: attractive bottle, positive image, known brands. Women Many women like fruity, light but not too dry wines. They are more relaxed when selecting wines. Open minded people People that like to try new thing. They enjoy life, tend to live in urban areas, like to travel and discover new countries and cultures. 26

27 Market Opportunities Target groups The Portuguese community in Switzerland is the third biggest community of foreigners in Switzerland (after the Germans and the Italians). They are 3% of the total population and the number in increasing Portuguese leaving in CH (Source: Bundesamt für Statistik) 27

28 Market Opportunities Portuguese community = Vinho Verde consumers The Portuguese community in Switzerland is the main pillar of the Vinho Verde consumption in Switzerland. They know Vinho Verde wines from their home country and are used to this taste. They buy the wines in supermarkets or within Portuguese importers and traders in Switzerland. Today there is already the second generation of the Portuguese immigrants. These people are better educated, have higher incomes and have a strong relationship with their home country. 28

29 Market Opportunities Opportunities and challenges The consumption of foreign white wine is slightly rising every year. The Swiss consumer looks for authentic wines with characteristics of their terroir. They look for autochthonous varieties and individual characters. Consumer habits are changing. Before white wines were only consumed as an aperitif (without food), now more and more they are also consumed to accompany meals. The most open channels for new products are importers of medium or small volume. Switzerland is a quality market that requires seriousness and consistency in products and trade relations. 29

30 Varia 30

31 Fairs Most important fairs in Switzerland In Switzerland there are no professional trade fairs for importers. This means there are no fairs where producers can look for importers. Swiss importers visit the big European fairs as Prowein, Vinitaly, London Wine Fair, etc. or travel directly to the countries of their interest. The follow international guides as Parker, Decanter, Wine Spectator, etc. or international awards like Mondial de Bruxelles, Mundus Vini, Berliner Wine Trophy, Decanter, etc. The wine fairs that are hold in Switzerland are consumer shows. The traders are exhibiting and selling to consumers. There are specialized wine fairs and general trade shows with wine sections. 31

32 Specialized Press Most important specialized magazines and newspapers Magazine Language Frequency Circulation N readers Vinum Switzerland German Vinum French Schweizerische Weinzeitung Weinwisser Salz & Pfeffer Marmite Hotellerie & Gastronomie htr hotel revue Gastro Journal German 10 x year 21'000 80'000 French 5 x year German monthly German 11 x year 4'700 25'000 German 8 x year 20' '000 German 6 x year 18'000 70'000 German/French weekly 35' '000 German/French weekly 12'000 80'000 German weekly 25' '000 32

33 November 2014 Market study elaborated by mettler vaterlaus gmbh, Zurich References: Bundesamt für Landwirtschaft Bundesamt für Statistik Schweizerische Weinzeitung CVRVV PEWGLOBAL 33