November 14, 2024

Bordeaux Futures and « en primeur » sales

EDITO

Frédéric Lot

THE "BORDEAUX FUTURES' SALES: THIS BORDEAUX EXCEPTION!

Since the early 80s, "Bordeaux Futures" has been a key event in the marketing of Bordeaux wines to the end consumer. Every year, buyers from all over the world, journalists, critics, sommeliers, wine merchants, importers and other influential influencers gather in the Bordeaux region.

Origins.

Probably English-inspired, in view of the 18th-century practices of the port wine trade, « En Primeur" sales remain primarily the business of Gironde estates and wine merchants. The economic crisis of the early 1970s encouraged a number of Bordeaux estates, then in the throes of serious financial difficulties, to invent an original system for promoting and marketing their wines; a fruitful process that not only enables them to finance their operating costs and the immobilization of their wines during maturation, but also their ability to finance the next year's harvest. Ingenious!

How it works? 2 tactical steps.

The En Primeurs, in keeping with an unchanging principle, takes place in two key phases. The first, initially held at the end of March (officially lasting 5 days), but in recent years moving to mid-April, is dedicated exclusively to the official presentation of all wine samples; The latter are now being matured in the tranquillity of the Grands Crus' cellars, after being skilfully blended in January and February. Official bodies, including the historic Union des Grands Crus de Bordeaux (UGCB), the Association des Grands Crus Classés de Saint-Emilion (AGCCS) and other associations, are responsible for organizing, coordinating and promoting this major event, where the reputation (whatever that may be) of the current vintage is established and confirmed. Initially, this only concerned 130 properties, but from the 2000s onwards, it was extended to other brands and properties, to reach today some 300 to 350 properties and other strong brands, which await, with serenity or sometimes apprehension, the judgment of professionals that will seal their success or failure, all massively relayed by the international specialized press.

More than 4,000 professionals converge on Bordeaux for a tussle over wine pretensions. Aimed primarily at experienced tasters, this exercise is undoubtedly demanding from every point of view, and complex. The aim is to quickly (and efficiently) gauge a large quantity of samples which, although definitively assembled, have not yet finished their journey: It takes between 18 and 24 months for the system to become operational, from the time the wine is placed in barrels to bottling. This detail implies an inevitable evolution in the wines' profile. This is why, at this stage of the meeting, the only consensus can only concern the technical (and therefore objective) criteria of color, quality, ripeness of fruit, aromatic intensity, balance and harmony on the palate, while anticipating the evolution of the wines by attributing to them a capacity or not for longevity (and here, some tasters are more gifted than others). In other words, everything that reveals the quality of the work carried out over a whole year by the properties and their teams. However, these technical benchmarks will vary considerably depending on the type of wine: dry white, sweet or red.

The opinion, comments and notes that follow do not constitute a definitive and firm position. We can't stress this enough, but it's important. These impressions, which are essential for driving the future market and transactions, are merely a photographic representation of wines at a given moment in time. It is widely recognized that the need to monitor and re-taste them "en livrable", i.e., once bottled and available on the market, is an indispensable, responsible and credible approach.

The second eagerly awaited highlight for sales professionals is the marketing of the harvest. Better known as the "Primeurs" campaign, this release of wines (or "release") cannot take place without the help of the wine merchants, who have been in the business for over 800 years. Numbering around 300 in the Gironde region, Bordeaux wine merchants work closely with the estates to regularly monitor their production, vintage after vintage. Based on a relationship of trust, sometimes of long-standing loyalty, the owners mandate the négociants to promote their wines and have them purchased by buyers from all over the world. These merchants, better known locally as the "Place de Bordeaux" or "Market Place", are the only ones able to manage and run this internal market in the Gironde department; market where the finest wines are rapidly traded.

It should be noted that the powerful and effective role of trading also consists in its ability to regulate the market. This is a decisive factor in securing customer loyalty, while offering them the guarantees - in terms of wine origin, quality and price - of an offer that is always adapted to market expectationsBut in this case, things are not so easy because unknown factors come into play: Every year, everything is called into question, starting with the "exit price" demanded by the châteaux, the purchase price agreed by the merchants (based on the potential appetite expressed by the markets), and finally the selling price to consumers: Increases are not always easy to swallow, and must be fully justified. This explains why many "Primeur campaigns" have been more successful in the past than others that have been more sluggish. So much so that, despite certain rumours, the system sometimes falters without being called into questionWe won't mention the "incriminated" years here, because the aim of this editorial is not to be polemical, but to explain to everyone what the En Primeurs are all about. Because everything depends on the quality of the vintage and the state of stocks on international markets. The En Primeurs are far from an exact science, and their success also depends on the art of diplomacy between the parties involved and a certain logic: knowing how to meet your target (the consumer) with the right price, at the right time.

The "allocations."

The special feature of this purchase by the trader is a system based on allocations. Allocations, the number of which can vary from year to year, refer to the exact quantity of cases that the château agrees to reserve for the various trading houses. As soon as the "exit price" - the price at which the château wishes to sell its wine - is known, the négociant makes his purchasing intentions known through a mandatory intermediary who plays a central role: the broker. 93 wine brokers in Gironde can be sworn in to handle these transactions. Similar to a lawyer, the broker pleads on behalf of both parties, defending the interests of both the château and the trading house. Its role is therefore decisive: to ensure the smooth running of transactions between these two players, so that "the campaign" runs smoothly and enables Bordeaux wines to be exported to nearly 160 countries. With such a broad reach, it's easy to understand the strength of the wine merchant.

The principle – The benefits.

While Primeurs are good for the trade, as a private customer, you'll be able to get some excellent deals if you make your own "en Primeur" purchases. A principle long put forward as a powerful argument for encouraging transactions. The key principle is to buy in advance, i.e. 12 to 18 months before the wine is actually available in bottle. This "advance purchase" of wines, comparable to a "subscription" sale, provides access to highly sought-after vintages at prices well below (between 20% and 30% lower) those once they have been bottled and delivered to the customer. This is all the more true when you consider that the very best vintages, which are obviously very popular, can quickly become very expensive, in line with the principle of real wine improvement and the implacable law of supply and demand.

Where to buy?

While there is not just one but several different négociant professions (depending on the type of wine to be marketed) and distribution channels, private customers can turn directly to négociants who specialize in direct sales to individuals. The latter mainly sell their "Primeur offers" by mail order, sometimes by catalog (even if the current trend is towards general dematerialization), by telephone or via the Internet, with customers managing their purchases via their tablet or smartphone. Retailers will be able to provide the end customer with suitable products, accompanied by sound advice, specific services (optimal storage, cellar management, etc.) and all other guarantees for shipping these wines in original wooden cases purchased exclusively directly from the châteaux: This is a crucial point in terms of traceability and confidence, and encourages people to turn to these sellers, who are firmly rooted in the Bordeaux vineyards, or to other well-known sellers abroad who benefit from these famous "allocations". You can find a list of all these retailers on the WineBHM.com website by searching for a particular wine.   F.L.