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Tesco sells Champagne for less than £7.50
British retailer Tesco is selling Champagne at the below-cost price of just £7.46 per bottle over the Easter period.
The UK’s biggest supermarket chain is selling Pol Aimé Brut Champagne with a 25% discount applied to its already low price of £9.95.
The deal, which runs from 23 March to 3 April to tie in with Easter celebrations, applies when shoppers buy six bottles.
It means that customers will be able to buy a six-bottle case of Pol Aimé for only slightly more than the price of a single bottle of Bollinger NV Champagne at Tesco.
It is thought Tesco will make a loss on every bottle of Pol Aimé sold at the reduced price due to the production costs involved in putting a bottle of Champagne on its shelves.
Approximately 1.2kg of grapes are needed to make Champagne. The average price of wine grapes in the Champagne region between 2011 and 2015 was €5.78, according to figures from the Comité Champagne.
This means the price of the grapes needed to make a bottle of Champagne is roughly €6.94, or £5.50 at the current exchange rate.
Factoring in high duty and VAT costs, as well as production, storage and transport, it is inconceivable that a bottle of Champagne can sell for less than at least £10-£15 in the UK without making a loss.
Tesco has been invited to confirm whether Pol Aimé is a loss-leading brand.
The retailer has exclusive ownership of the Pol Aimé label, giving it the advantage of selling at a rock-bottom price without damaging the reputation of Tesco’s own-brand fizz.
However, it has the potential to damage the luxury image of Champagne as a whole.
According to Tesco’s website, Pol Aimé Champagne is produced by “small, traditional producers with a record for quality and for good value.”
It is supplied by Champenoise des Grands Vins, a subsidiary of Lanson BCC, which owns Champagne Lanson and Champagne Philipponnat among other major brands and companies.
Champenoise de Grands Vins is a major broker of Champagne that sources liquid from numerous producers to sell on to distributors under brand labels.