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Champagne sales hit by cocktails and cava

The rise of cocktails and cava is affecting Champagne sales in the London on-trade.

“Everywhere you go there seems to be a cocktail list that is interesting and exciting and that is definitely cannibalising wine list sales,” said Damian Carrington, sales and marketing director for Fields, Morris & Verdin (FMV).

He told the drinks business that the demand for Champagne has dipped in bars and restaurants partly due to the economic climate in Europe but also because of the greater availability of good cocktails.

He also explained that selling more cocktails made financial sense for on-trade outlets. “The GP [gross profit] on a cocktail is much bigger than it is for Champagne,” he said.

Further, the emergence of companies like Funkin, which supply ready-made fruit purees, and other drink-making ingredients, means, “it doesn’t take a highly skilled bartender to make a good cocktail.”

Meanwhile, sales of sparkling wine are also affecting Champagne’s performance, he believes, judging in particular by the demand for FMV’s new cava brand Raventós i Blanc, which the wholesale company took on at the end of 2010.

“We are really shocked at how well it is doing… it has gone beyond the traditional Spanish restaurant. And I definitely think cava is taking business from Champagne.

Continuing he said, “People are more happy to be seen drinking cava than Champagne and the lower price of cava means you can put it in cocktails.”

“All sparkling is doing well,” he added, mentioning Prosecco too.

“I think there is a mood that people feel they can’t be seen to be drinking Champagne like we saw at the end of 2008,” he surmised.

Speaking of the London on-trade more generally, he said that “there is definitely an Old World vibe at the moment… although part of that is exchange rate driven.”

“There is a move towards more elegant styles of wine with more balance and finesse,” he continued, adding, “and while you can find these wines in the New World as well, they are being scuppered by the exchange rate.”

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