Meiburg: Taiwan ‘not just a little China’
Taiwan is rapidly emerging as an interesting prospect for wine producers and is not “just a little China”, according to Debra Meiburg MW, who has described it as a “unique, robust and eager market”.
Speaking at a seminar on the Taiwanese wine trade at the Hong Kong Wine and Spirits Fair today, Meiburg said many producers had “forgotten about Taiwan in the race for the [Chinese] mainland”, but that it was a rapidly maturing market.
“It’s not quite as sophisticated as Hong Kong or Singapore but it looks like it’s on the path toward Japan”, said Meiburg. “It’s been influenced by Japan and I can see that in the approach culturally. I think we will see it start to mature very soon.”
Meiburg pointed out that taxes on wines imported into Taiwan are “relatively fair” with a 3% minimum with different levels depending on alcohol level – a feature of the market that “no-one pays attention to”, says Meiburg. This can be compared to China, which has a 48% tax and Hong Kong, which has zero tax on imports. Another benefit of operating in the market is the apparent lack of a counterfeit wine trade, with fakes a relatively unheard of concept in Taiwan. Meiburg reported that many importers “looked puzzled” when asked about the problem.
However the most unique aspect of the Taiwanese market highlighted by Meiburg was its strong culture of BYO (Bring Your Own), with its population described as ardent “bargain hunters”.
“I have never seen anything like this”, said Meiburg. “Hong Kong has a BYO but mostly when we bring our own wine to restaurants we are bringing Lafite or special, expensive treasures. In Taiwan they BYO all the time, it’s normal. It’s so embedded that they will call the retailers and say I’m going to dinner at this restaurant can you send a case for me. The importer will then deliver it to the restaurant”.
A culture of negotiation within the off-trade is also a key driver of the market, with wines marked up at prices 5 to 15% higher than what they are eventually sold for with haggling over price an expectation.
“It was absolutely fascinating to to me”, said Meiburg. “As a wine importer you might see the prices and thing that’s great, I’m going to get high margins. But 5% is always taken off, up to 15% if you are a good negotiator and buying in volume.”
Retail outlets themselves operate on a unique basis, with many being specialised shops ”at the bottom of a housing development or in a basement”.
“Most of these retail outlets have private locker storage, so you can buy the wine and then store it there. Most have tables and chairs so you can open your wine with friends then put it back in the storage locker and come back another time – they are more like wine bars.”
While its focus on BYO and negotiation typifies the market’s focus on value, it does mean that the country’s sommeliers are consequently “under utilised”.
“They are very well trained in expert service but they don’t have the same buying power and their lists are not in their control because of the BYOB.”
The importance of digital branding was also highlighted as a key consideration when approaching the Taiwanese market, with importers citing Facebook as the most important tool when building brands.
However what was perhaps more surprising was that of the importers operating in Taiwan, 31% are using both retail and e-commerce platforms and 22% e-commerce only – surprising because e-commerce channels for the sale of wine is illegal in Taiwan.
Retailers are getting around the retraction by posting a sale online and calling the customer when the order comes in, or transferring their communication of an email. However when the wine is delivered appropriate ID must be presented by the recipient.
“That’s why it is illegal in Taiwan, because of underage drinking”, explained Meiburg. “The business has figured out a way to get around it”, adding: “Most people I speak to feel that e-commerce for wines will become legal soon.”
Concluding Meiburg urged attendees not to think of Taiwan as “just another little China”.
“It’s is a very unique, robust, eager market”, she said. “They love education and are interested in wines. Taiwanese people are far more easy going and relaxed and easy to deal with, so I encourage you all to consider this market.”
The seminar coincided with the launch of Meiburg’s latest Guide to the Taiwanese Wine Trade, part of a series of books published on the wine trade in Asian cities including Singapore, Beijing and Hong Kong.