Eighteen months after being purchased by Australia’s Woolworths, Pudao Wines spoke exclusively to DecanterChina.com about its next steps forward.

The new investor

More than a year and half ago, the news broke that Pudao Wines, together with its sister firm Summergate, was purchased by Woolworths, one of Australia’s largest wine retailers.

Marcus Ford, general manager of Pudao, said the business ‘has benefitted greatly over the course of the past 18 months in establishing more sophisticated systems and processes.’

‘When Woolworth’s acquired Dan Murphy’s in Australia it too was a small retailer with a very few shops, [and] now it is the dominant wine retailer in the Australian market,’ said Ford, hinting at the retailer’s potential in Greater China.

The post-austerity period

As a fine wine retailer that initially put great emphasis on the corporate gifting sector, Pudao has had to adapt to a new reality.

‘Very few companies now use wine as a gift and those that do are more focused on value offerings than the super premiums of years gone by,’ said Ford.

Currently, most of Pudao’s consumers are buying wines at between 100 to 500RMB (£10-£50) per bottle. ‘Our customers are very open-minded about region and style.’

Amid general changes in the market, ‘we have continued to grow at a healthy and sustainable rate’, said Ford.

Try before you buy

For Pudao Wines, which owns an online store and two offline shops, ‘try before you buy’ is the key in promoting wines to Chinese consumers, said Ford.

The retailer therefore actively invites customers to try wines in their flagship stores in Shanghai and Beijing, and organises hundreds of tasting events, he said.

Offering a specialised service is also important, said Ford. ‘The majority of our staff came from a service background.’

Fake wine: ‘Not just a China problem’

Another concern that’s stopping Chinese consumers from buying wines is the risk of getting fake wines.

‘I would point out though that the fine wine market has problems globally and consumers need to be aware that this is not just a “China problem”,’ said Ford.

‘We work with established importers and have great relationships with many, we are 100% focused on sourcing from the best.’

China in the next 5 to 10 years

‘I think over the past 10 to 15 years the wine market in China has been through some very exciting and sometimes over-heated times,’ said Ford.

The next 5 to 10 years will see a ‘more stable market’ develop as consumers grow in confidence. A key element will be how domestic wines perform, and whether they can compete on quality and value against imported wines, said Ford.

He added that Pudao Wines ‘aims to open more stores over the coming years’, but won’t be rushed.

‘Imported wine is really only a decade old in the China market so whilst we are ambitious we are also in no hurry to open a huge network of stores.

‘In Hong Kong we have re-branded our business under the Langton’s banner (part of the Group) and we are very excited about our fine wine brokerage service that is now up and running there.’

Word of advice for people new to the wine business

‘Wine is a complex business with many layers- some wines are commodities, some are like fast moving consumer goods, some are boutique productions and some are like luxuries and collectibles.

‘You need to be very precise about understanding your customers, what they are looking for and how as a retailer you can add value to their experience.’

Translated by Sylvia Wu / 吴嘉溦