Trading Place: gaining global distribution through Bordeaux

Prestige wineries

Opus One was the first wine outside France to be traded through La Place de Bordeaux

Opus One was one of the first – if not the first – prestige wineries outside of France to take this unusual move. But it has been followed over the past dozen years by an increasing number of other high-profile wineries, notably estates such as Masseto and Sassicaia from Tuscany, Clos Apalta in Chile and Vérité in Sonoma County. Many others are exploring the option, although La Place is picky about whom it represents.

Understanding La Place is both simple and difficult. Allan Sichel knows Bordeaux from all angles, as he heads Bordeaux’s CIVB trade group, and his family’s négociant firm, Maison Sichel, also owns a significant portion of Château Palmer.
“Négociants are merchants,” Sichel says, “Their core business is to buy and sell wine.”
This is simple enough, until one gets into the details. First, many négociants have allocations to sell the same wines from the same châteaux in the same destination countries. In fact, some large châteaux may spread their allocations among several dozen négoces. In countries such as the US, which has its own bizarre collection of distributing and marketing laws, consumers and retailers are often confused as to which négociants are selling wines from which châteaux.
Second, there is another historic class of merchants – courtiers – who serve as brokers between châteaux and négociants. While courtiers may not be as vital a link between the great-growth châteaux and La Place, they can be a crucial connection in getting lesser-known châteaux a good distribution through La Place. Finally, most of the classified growths who sell on La Place also take part in the en primeur barrel tastings each spring of the previous vintage (to establish expected quality) and in “the campaign” that takes place the following weeks (to establish an opening price, as there may be subsequent releases or tranches).
The attraction for both the foreign winemakers wanting to sell on La Place and the négociants is that they only need be involved in the first step – matching buyers and sellers – while not generally dealing through courtiers or being allowed to take part in en primeur.
“For years and years, the Bordeaux wine merchants have sold in their portfolios wines from outside Bordeaux, including wines from Burgundy, the Loire Valley, Provence and so on,” says Emmanuel Cruse, owner of Château d’Issan and Grand Master of the Commanderie du Bontemps de Médoc et des Graves Sauternes et Barsac. “Now, due to other investments, they are able to sell in their portfolios wines from the US, Argentina, South Africa, and so on.”
Those “other investments” to which Cruse refers are those having been made by many classified Bordeaux estates in the past four decades to make wines in far-away places, either solo or in partnership – such as Baron Philippe of Château Mouton-Rothschild’s investment in Opus One. Their ability to then pressure négociants to represent their New World wines is readily apparent, but one they seldom need to exercise, as their foreign off-shoots are generally of high quality and independently much in demand.
Four years after Opus One’s move to La Place, in 2008, it was joined by Masseto, the Tuscan merlot-based wine owned by Tenuta dell’Ornellaia, which was the first estate in Italy to do so. “Basically, we wanted to divide Masseto from Ornellaia, as Masseto does a much-smaller volume,” says Giovanni Gedes da Filicaja, who heads Ornellaia. “We wanted to go from being a ‘brand’ to being a small estate, and being on La Place helped achieve that.”
The fact that courtiers – who get about a 2% commission for each transaction – were being left out in the cold with these new relationships was for a time a point of contention, Sichel says. “The traditional approach for Bordeaux wines would be to select one or two courtiers who would then help the property build up a list of potential négociant buyers who would subsequently receive an offer,” he says. “The négociants would then decide whether they wished to take up the offer or not.” Ultimately, the association of courtiers decided not to get involved. “The lack of geographic proximity with wines made outside of the Gironde makes it difficult for them to provide the same level of guarantee on wines they do not have a long-standing, detailed and intimate knowledge of,” Sichel says, an important factor because of courtiers’ traditional legal and fiduciary standing within France as guarantors.

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