2017 was ‘a challenging year’ says ASC CEO

Yoshihiko Shibuya, CEO of China’s leading wine importer, ASC Fine Wines, admits that 2017 has been a challenging year for the company following a leadership reshuffle and a revamped portfolio that saw the exit of major brands including Treasury Wine Estates’ Penfolds.

Yoshihiko Shibuya was appointed CEO of ASC Fine Wines last April

With 20 years of experience at Suntory, the parent company of ASC Fine Wines, Shibuya was appointed CEO last April, taking over Bruno Baudry. The first year was compared by the veteran Suntory executive to, “a year of start-up”, when speaking exclusively to dbHK in Hong Kong during Vinexpo.

“Last year, first of all, was my first year. Honestly speaking, it was a pretty challenging year,” he confessed. “We had lost some big brands the year before. We have to focus on developing new brands. It requires energy, and also we had some staff changes, a little bit of a turnover issue.”

The company has more than 100 brands in its portfolio and counts itself as one of the biggest wine importers in China with more than 20 years in mainland China’s imported wine scene.

But 2017 was a year of defining changes, especially as competition in China’s imported wine market is becoming more challenging, with Australian wine giant Treasury Wine Estates (TWE) now taking distribution into its own hands and state-owned wine importer COFCO Wine & Wine becoming more confident and flexing its muscles.

In 2016, TWE officially broke off its partnership with ASC and took its flagship brand Penfolds and other brands such as Rawson’s Retreat and Wolf Blass. ASC however was at least able to add two leading Australian fine wine brands – Yalumba and Henschke – to its portfolio in order to compensate for the loss.

A few months shortly after the changing of the guard at ASC’s top level, the company announced a further consolidation of its restructure plan into three major branches – Greater East Region, Greater South Region, and Greater North Region – in October.

“We had had a turnover issue, new brands, new staff. We needed to spend time to consolidate,” he added.

Nonetheless, last year the company still recorded “moderate” growth, according to the executive. “We had moderate growth last year. This year so far – by the end of May – we have seen very encouraging development of about 25% increase in both volume and value,” he said.

At a time when ASC is going through portfolio and leadership changes, rumours started to swill among the trade regarding another of its most important partners, Domaines Barons de Rothschild (Lafite), as the two are expected to renew their partnership next year. The DBR Lafite Group, which includes Château Lafite Rothschild and its more accessible ranges of Légende and Saga is crucial for ASC’s overall volume growth, he revealed, in part thanks to Lafite’s massive popularity in China market.

Shooting down any rumour of a possible break-off, he affirmed: “Don’t worry we have a very strong relationship. I have no concerns,” although adding that some adjustments might be expected as the group recently went through a leadership reshuffle as well with new CEO, Jean-Guillaume Prats, and co-chairman, Saskia de Rothschild. But nothing major that will “disturb the market”, he asserted. “Maybe we need to make some minor adjustments…but overall there are not going to be big changes.”

Asked about this year ASC’s plan for en primeur, Shibuya said that it was still too early to confirm ASC’s spending on Bordeaux futures, but admitted that he’s not optimistic about this year’s 2017 Bordeaux campaign, because the, “price is still too high”.

With 20 years’ experience in the Suntory Group, Shibuya was previously based in France for more than five years to manage Suntory’s wine businesses in Europe and relational maintenance with wineries, before heading ASC.

Owned by Suntory, ASC Fine Wines is the importing arm operating in Greater China under Suntory Wine International, which also owns three châteaux in France – Château Lagrange, Château Beychevelle and Château Beaumont, as well as Weingut Robert Weil in Germany, one négociant Barrière Frères in France, two importing companies in Japan in addition to ASC in China.