Blog Nick Adams mw January 2024

The Quality Will Remain When the Price is Forgotten” Sir Henry Royce (Rolls-Royce)


First, I hope you all had an enjoyable and profitable Christmas.

As we start the beginning of the new year and – for some - hit the “dry January” month, or - like me - maybe drink a smaller amount but of higher quality, this brought me around to a perennial subject matter in the trade regularly headlined under the banner “drink less, but better” – and what this might mean in relation to wine. In addition, as wine duty rates continue to be targeted and rise maybe the days of the “cheap and cheerful” bottle of wine are numbered anyway?

For the average (% abv) bottle of table wine duty now stands at £32.04 per 9 litre case – or £2.67 per bottle before VAT. And this will almost certainly rise further in the March 2024 budget. In effect, and based on average raw material costs (bottle, carton, label etc.) and aspects such as transportation the value of wine itself in a (retail) priced £4.99 accounts for around 7% of the overall cost or value. Then look at a bottle which is 3 times that retail price and the average value of the wine in that bottle rises to well over 40%.

And, in general, if people are being recommended and pressured to drink less then the desire to drink better when you do will only rise exponentially.

I will also, therefore, highlight some examples from the Peter Graham portfolio where a proportional trading up in cost delivers a disproportional increase in quality. 

The Price Ranges for Wine

To set the scene with how diverse pricing is, you can still find wine for retail sale in the UK at under £5 per bottle (regular sales price), whilst comfortably exceeding £10,000 a bottle at the other end of the scale. Does that mean this bottle is 2,000 times better than the other – of course not; as aspects of rarity, collectability, and investment values all come into play. But at a more realistic scale for most of us a £10 or £20 bottle of wine might very well be much more than two or four times better than the £5 example. 

As mentioned, a lot has to do with the duty levels imposed on wine in the UK by government. Only Ireland and Finland have higher duty levels on wine than the UK in Europe. And mathematically the lower the price a bottle is the higher the proportion of its price will be accounted for by duties and much less by the cost of the wine itself. Please see the diagram below which neatly shows the percentage value for the wine at £5, as against £15 – as both bottles incur the same amount of duty (£2.67 per bottle) and VAT @20% on that Duty. The value and quality of the wine is significantly and proportionately higher in the £15 bottle. And this model (left) – or ratio – quite clearly applies as much to wines sold through on lists in the On Trade. 


Does this mean a £5 or £6 bottle is rubbish – of course not; reputable retailers and wholesaler merchants would not have them on the lists if so. But will it be at least as half as good as a bottle at £10, almost certainly not.  

In fact, trade data analysis has identified that the threshold retail price point where you are finally paying less money on the tax for, than the wine (including production costs) itself, is virtually £7! In effect for a £7 bottle, the value of the wine in it is £3.55.

And, as ever, the style of the wine is clearly very important. If you really don’t like the Chardonnay grape it probably makes little difference if the bottle is £7, £15, or £25 – you won’t enjoy any of them! However, if you really do like Chardonnay, it might be worth exploring the extra quality and concentration you might well find in a mixed range of priced bottles? In fact, this approach may also be useful if you are looking to build a selection of wine for mixed occasions and palates. 

And it is great fun to open examples side by side and investigate the quality differences – please look at the highlighted Peter Graham selection at the end of the blog. 

Having a Balanced Wine List to Reflect Consumer Tastes, Occasions, and Budgets

Clearly these principles apply as much to a good wine list as any retail shelf selection. Obviously, this includes the key factor of being competitive, but that should not be driven by a model of having every category and style at basement pricing. If people move more to drinking less but better, then the requirement to offer higher quality examples in the mix will never be more important. And taking a very simple example – something I know only too well myself – if you are going to have just one glass of wine during your visit/meal then you will want to indulge in the best (by style that suits you) that the list offers by the glass. This is another reason to consider expanding your wine by the glass selection – not least as preservation systems are efficient and widely available to do so. 

And it is worth relating why you should use this model when you compare with the menu options in most places. Again, to take a simple example, many places offer more than one cut of steak – maybe from rump, to sirloin, to fillet (especially if they have a grill facility) because people are prepared to trade up to better options if they are provided.

The “Sip” versus “Gulp” Principle

In general, you should find that the higher quality wines have greater levels of flavour and concentration and linger longer on your palate. As a result, you might often find you “sip” (and savour) rather than “gulp” the drink - because it is delivering a far more interesting flavour (and aromatic) kaleidoscope. It will provide more of a talking point, is worth reflecting on, and may well work better with food in general, or when planning a special menu and occasion. 

And people, in general, are more likely to order another glass of a wine they are enjoying “sipping”, whilst maybe giving up on the less inspiring “gulper”. 

Of course, we must always respect choices made in relation to someone’s budget, but I would strongly recommend trading up for certain clientele, menus, and occasions – and especially when you have identified grapes, regions, and styles which you already know they really enjoy. Above all, it is worth building tiers and layers into your wine list and having confidence to offer more by the glass. We are only heading one way in this country for the future with wine – people will drink less, and they will, over time, and with persuasion/assistance, and the availability - trade up. 

Best wishes for a happy and successful 2024 – and to finish some highlights off the Peter Graham list which are worth looking at in terms of building a range offering.

Our highlights

Taking the first pair and looking at the ever-popular Sauvignon Blanc grape, from France. The Riviera Southern France delivers a nice, clean, and citric style; whilst the classic Sancerre Pre Semele from Domaine Rimbault takes the variety to another level in terms of citrus fruit concentration, texture, length of flavour, and minerality.

Then onto the leading black varietal Shiraz/Syrah and Rhône style reds - two New World offerings. The Bushranger South East Australian example delivers upfront, bright, and juicy black fruits; whilst Chilean Viña San Estaban In Situ Single Vineyard Aconcagua Syrah, Mourvèdre, Viognier Rhône styled blend has more precision, power, black fruit, and spice notes.

Finally, finishing with Port – and not least thinking of the season (and cheese). Graham’s is one of the best port houses and their “entry level” Ruby blend Six Grapes is very good – with plenty of fruit, warmth, and a sweet, cherry liqueur style. But move onto their single vineyard Malvedos 2012 Vintage Port and the whole style takes on another dimension in terms of richness of dark and red fruits, spice and liquorice, texture and sheer length of flavour – the ultimate style of wine to “sip”.