Since the the government has supressed the import duty in 2008, wine business, culture, knowledge and consumption has tremendously developed in Hong Kong. It has benefited most actors, but paradoxally not the Hong Kong consumers. Why? The new collaborative economy offers solutions that can tremendously benefits customers!
Hong Kong is Asia’s uncontested wine HUB
- Hong Kong is tax heaven for wines: 0 import duty and no V.A.T.
- With several thousands of wine importers, Hong Kong has one of the largest wine range selection form all over the world, multiple international wine fairs, Wine education, tainning and tasting events.
- Hong Kong Wine trade has florised: Import, Logitic hub, re-export to China and neibouring countries.
But despite this, for Hong Kong consumers wine available to purchase remain expensive, and despite the widest wine range being imported, most point of sale offers a quite narrow selection of wines.
Consumers have not fully benefited, Hong Kong specifics…
People largely live in flats, with little storage capacity, and need to make small frequent orders.
The Hong Kong distribution Bottle neck!
A Concentrated distribution: Duopoly of supermarkets
Dairy Farm and Park N shop groups dominate the distribution (supermarkets, Watson’s wine, 7/11).
Narrow selection of cheap wines or High end expensive vintage Oligopole of lage and dominant companies: Watson’s wine, Jebsen, Kerry.
Highest rent in the world: High storage cost (rents + air-condition), and retail crazy rents Restaurants have the same dilemma: Competitive purchase prices, but rent amongst the highest in the world. In other words, the import duty suppression has not benefited to all in Hong Kong.
Small industry players offers diversity but are penalized by cost and distribution concentration, and direct import from large accounts The beauty about having a wine hub in Hong Kong should be the REAL possibility to offer to Hong Kong consumers an immense choice of labels, countries, wines types and flavors representing the extreme richness wine offers globally (different soils, countries, climate, grape varieties make. There is not one Prada or Gucci of the wine world: There are thousands and thousands of enthusiasts wine producers around the world. The current concentration, standardisation of wine offering is counter productive and unsatisfactory.
“L’ennui naquit un jour de l’uniformité” Antoine Houdar de la Motte 1719
The O2O Wine opportunity!
Small, independent wine importers should collaborate, and join efforts (storage, delivery, promotion) to provide variety, competitive prices and
smart deliveries to end users. The Internet, numeric economy and peer to peer collaboration offers tremendous opportunities to create a very efficient wine delivery service in Hong Kong, creating a real level playing field wine for Hong Kong wine industry. Distribution : Omnichannel and O2O (online to Offline): convergence of distribution channels