Free DipWSET D2: Wine Business Flashcards
DECK Number 6
Instructions before starting:
I RECOMMEND YOU LEAVE THE CARDS IN THE INITIAL ORDER AND USE THE “SHUFFLE” OPTION ONLY WHEN YOU MASTER THE WHOLE DECK (= 0 MISTAKE)
Read the Term on the Card and give your answer Click on “Check the Answer” button to check your knowledge Click on “Got It!” if your answer was correct
Click on “Need more practice” to review the card at the end of the deck and try answering another time
Click on “Shuffle” button to change cards order
GOOD LUCK!!
[qdeck]
[h] DipWSET D2 SET 6
[i] DipWSET D2 – Wine Business Flashcards
SET 6
I RECOMMEND YOU LEAVE THE CARDS IN THE INITIAL ORDER AND USE THE “SHUFFLE” OPTION ONLY WHEN YOU MASTER THE WHOLE DECK (= 0 MISTAKE)
– Read the Term on the Card and give your answer
– Click on “Check the Answer” button to check your knowledge
– Click on “Got It!” if your answer was correct
– Click on “Need more practice” to review the card at the end of the deck and try answering another time
– Click on “Shuffle” button to change cards order
[start]
[q unit=”2″ topic=”6″] SUPERMARKETS (characteristics)
[a] 1- IN USA / UK / FRANCE = LARGEST MARKET SHARE
2- ATTRACT CUSTOMERS WITH LITTLE WINE KNOWLEDGE
3- STOCK WINES FROM WELL KNOWN BRANDS / GRAPE VARIETIES / REGIONS
4- WINE STYLE THAT APPEAL TO A WIDE RANGE OF CUSTOMERS
5- CUSTOMERS CAN COMPARE PRICES
[q unit=”2″ topic=”6″] SUPERMARKETS EXCLUSIVE WINES
[a] 1- SUPERMARKETS LIKE TO STOCK WINES THAT ARE EXCLUSIVE TO THEM
2- CAN CREATE THEIR OWN BRANDS & NAMES
3- SOME HAVE THEIR OWN BRAND RANGE OF WINES (e.g. Sainsbury’s Taste)
[q unit=”2″ topic=”6″] WHY SUPERMARKETS LIKE EXCLUSIVE WINES
[a] 1- BECAUSE THEY CAN ATTRACT CUSTOMERS
2- BECAUSE THEY PROMOTE CUSTOMERS’ LOYALTY
3- USUALLY BETTER MARGINS
4- NO DIRECT PRICE COMPARISON
5- REDUCES DIRECT COMPETITION
(alternatives less clear)
[q unit=”2″ topic=”6″] PRIVATE WINE LABELS
(definition)
[a] WINES THAT ARE MADE BY PRODUCERS IN ORDER TO BE EXCLUSIVE TO DISTRIBUTORS & RETAILERS
(usually through different & exclusive brandings)
[q unit=”2″ topic=”6″] PRIVATE WINE LABELS
(main characteristics)
[a] 1- EXCLUSIVE TO THE SELLER
2- NEED TO BE AVAILABLE IN LARGE VOLUMES
3- ATTRACTIVE OPPORTUNITY TO SELL LARGE VOLUMES OF WINE
4- OFTER NO INTERMEDIARIES
(buy directly to producers)
5- USUALLY SHIPPED IN BULK
(to retain low price points & high margins)
6- SUPERMARKETS CAN EMPLOY WINEMARKERS
TO WORK CLOSELY WITH PRODUCERS FOR SUPERVISION
& QUALITY CONTROL
[q unit=”2″ topic=”6″] PRIVATE WINE LABELS
(producers risks)
[a] 1- SUPERMARKETS’ WINE BUYERS HAVE ENORMOUS NEGOTIATING POWER
2- PAY FEES FOR SUPERMARKETS TO STOCK THEIR WINES
3- PAY FOR ANY ADDITIONAL PROMOTION
– product placement
– ads on supermarkets’ magazines
– pay for supermarket price promotion
4- SUPERMARKETS IMPOSE STRICT CONDITIONS
– quality control
– time & manner of delivery
– packaging
-labelling
5- WINES MAY BE DELISTED IF DO NOT ACHIEVE EXPECTED SALES
(volume or margin)
[q unit=”2″ topic=”6″] DEEP DISCOUNTERS
(9 main characteristics)
[a] 1- OFFER PERMANENTLY LOW PRICES
2- KEEP THEIR COSTS DOWN
3- LOWER MARGIN THAN SUPERMARKETS
(rely on volume)
4- SHOPS ARE BASIC
5- LIMITED PRODUCT RANGE
(cheaper to maintain)
6- WINES, OFTEN PRIVATE LABELS
7- MAJOR BRANDS ARE TOO EXPENSIVE
8- BUY DIRECTLY FROM PRODUCERS
(no intermediaries)
9- DON’T CHARGE SUPPLIERS
FOR STOCKING THEIR WINES
[q unit=”2″ topic=”6″] CONVENIENCE RETAILERS
[a] 1- CLOSER TO WHERE PEOPLE LIVE
2- OPEN FOR LONGER
3- SMALLER RANGE THAN SUPERMARKETS
4- DOMINATED BY MAJOR BRANDS
5- SOME HAVE THEIR OWN BRANDS
(exclusive)
6- HIGHER PRICES THAN SUPERMARKETS
(people pay for convenience)
[q unit=”2″ topic=”6″] SPECIALIST WINE RETAILERS
(definition)
[a] SPECIALIZE IN WINE
(sometimes with spirits & beers)
SOME SPECIALIZE ON TYPES OF WINE
– organic
– biodynamic
– natural
[q unit=”2″ topic=”6″] 2 EXAMPLES OF SPECIALIST WINE RETAILERS WHO FOCUS ON
PREMIUM & SUPER PREMIUM WINES
[a] 1- MILLESIMA (France, Bordeaux)
2- HEDONISM (UK)
PROCUREMENT = OFTEN ENGAGE IN “EN PRIMEUR” OFFERINGS
[q unit=”2″ topic=”6″] SPECIALIST WINE RETAILERS
(2 main characteristics)
[a] 1- LOWER PURCHASING POWER THAN LARGE RETAILERS
2- FOCUS ON WINES FROM
– smaller producers
– lesser known wine region
– lesser known grape varieties
[q unit=”2″ topic=”6″] SPECIALIST WINE RETAILERS
(interests for producers)
[a] 1- HIGHER AVERAGE RETAIL PRICES
2- CONSUMERS WILLING TO SPEND MORE (per bottle)
(because attract high involement customers)
3- BETTER MARGIN FOR PRODUCERS
4- BROADER RANGE OF WINES
5- MORE PERSONAL ADVICE
6- KNOWLEDGEABLE & WELL-TRAINED STAFF
(can hand-sell wines)
7- BUILD RELATIONSHIP WITH CUSTOMERS
8- CAN HOLD SPECIAL EVENTS
– tastings
– wine education classes
[q unit=”2″ topic=”6″] HYBRIDS
(definition)
[a] SPECIALIST WINE RETAILERS WHO ALSO HAVE A BAR AREA
– sell foods
– sell tapas, dishes, cheese…
OFFER CHANGING SELECTION OF WINE-BY-THE-GLASS
– showcase new wines
– wines from lesser known regions/grapes
[q unit=”2″ topic=”6″] HYBRIDS
(downsides)
[a] 1- STAY OPEN LATER
2- NEED ADDITIONAL STAFF
3- ADDITIONAL BUREAUCRACY ON OPENING PERMISES
[q unit=”2″ topic=”6″] ONLINE RETAILING
(4 main characteristics)
[a] 1- MANY RETAILERS OFFER ONLINE RETAILING IN PARALLEL
WITH SALES THROUGH SHOPS
2- INCREASING NUMBER OF ONLINE ONLY RETAILERS
3- ONLINE WINE CLUBS SET BY NEWSPAPERS
– New York Times Wine Club
– Sunday Times Wine Club
4- SOME GENERALIST ONLINE ONLY RETAILERS ALSO SELL WINES
(example: Amazon)
[q unit=”2″ topic=”6″] ADVANTAGES OF ONLINE RETAILING
[a] 1- NO NEED FOR EXPENSIVE RETAIL SHOPS
2- WAREHOUSE LOCATED IN CHEAPER AREAS
3- CAN STOCK LARGER & MORE VARIED RANGES OF PRODUCTS
4- LARGER CONSUMER BASE
(not limited to locals)
[q unit=”2″ topic=”6″] DISADVANTAGES OF ONLINE RETAILING
[a] 1- STILL NEED STAFF TO DEAL WITH CUSTOMERS’ QUERIES,
ORDERS, DISPATCHING…
2- SOME OFFER CUSTOMER ADVISORS (costs)
3- DELIVERY IS EXPENSIVE
4- RETAIN THE RISK OF LOSS, SPOILAGE, DAMAGE
5- CONSUMERS EXPECT QUICK DELIVERY
6- ENSURE SECURE, USER-FRIENDLY, RELIABLE WEBSITE
7- CUSTOMERS QUICKLY OFFSET BY SLOW
& NON-FRIENDLY WEBSITES
8- WEBSITE CONVEYS BRAND IMAGE
9- NEED ONGOING TECHNICAL SUPPORT
10- NEED WELL-PRESENTED, HELPFUL & DETAILED CONTENT
11- CUSTOMERS CAN LEAVE OWN REVIEWS & COMMENTS
(need moderation)
12- UP-TO-DATE CONTENT & STOCKS
[q unit=”2″ topic=”6″] ONLINE RETAILERS
(additional services to offer)
[a] 1- CLICK & COLLECT OPTIONS
2- MOBILE APPS
-general
-specialized
MOBILE APPS, MUST BE QUICK, EASY TO USE,
PROVIDE HIGH LEVEL OF SERVICES
[q unit=”2″ topic=”6″] GLOBAL TRAVEL RETAIL
(possible locations)
[a] AIRPORTS
SEAPORTS
INTERNATIONAL RAILWAY STATIONS
ONBOARD SHIPS
[q unit=”2″ topic=”6″] GLOBAL TRAVEL RETAIL
(characteristics)
[a] 1- HISTORICALLY KNOWN AS DUTY-FREE
(customers were looking for lower prices)
2- WITH FREE TRADE ZONES (such as the E.U.)
– prices less important
– look for high quality & high priced goods
that cannot be found at home
[q unit=”2″ topic=”6″] DISADVANTAGE OF GLOBAL TRAVEL RETAIL
[a] SELLING THROUGH GLOBAL TRAVEL RETAIL IS EXPENSIVE
– cost of retail spaces
– % of costs charged to suppliers
= LOWER MARGINS
[q unit=”2″ topic=”6″] WINE INVESTMENT COMPANIES
(definition)
[a] SPECIALIZE IN SOURCING & SELLING WINES FOR INVESTMENT
[q unit=”2″ topic=”6″] INVESTMENT GRADE WINES
[a] – THE MORE SOUGHT AFTER
& EXPENSIVE WINES IN THE WORLD
– RARITY VALUE
[q unit=”2″ topic=”6″] WINE INVESTMENT COMPANIES
(procurement process)
[a] USUALLY SMALL YEARLY ALLOCATION OF RARE WINES THROUGH:
– producers (direct)
– merchants (indirect)
[q unit=”2″ topic=”6″] WINE INVESTMENT COMPANIES
(other activities)
[a] CAN ACT AS A BROKER
(CUSTOMERS TELL THEM WHAT WINE THEY ARE LOOKING FOR AND THEY PUT THEM IN TOUCH WITH SELLERS + CHARGE FEES WHEN DEAL IS DONE)
[q unit=”2″ topic=”6″] WINE INVESTMENT
(historic perspective)
[a] HAS BEEN SAFER HISTORICALLY THAN INVESTMENT IN STOCKS
& SHARES IN TIMES OF FINANCIAL TROUBLES
[q unit=”2″ topic=”6″] RISK OF WINE INVESTMENT
[a] EVEN THE MOST PRESTIGIOUS WINES’ PRICES CAN FALL
[q unit=”2″ topic=”6″] MAIN WINES ON SECONDARY MARKET
(wine investment)
[a] BORDEAUX
BURGUNDY
CHAMPAGNE
PIEMONTE
TUSCANY
CALIFORNIA
+2 PRODUCERS IN AUSTRALIA (Penfold’s Grange, Hill of Grace)
[q unit=”2″ topic=”6″] HOW INVESTORS BUY WINES FOR WINE INVESTMENTS
[a] 1- EN PRIMEUR
– from producers
– through retailers
– on release
2- THROUGH A BROKER
– e.g. Cult Wines (uk)
3- ON SECONDARY MARKETS
– wine exchanges
4- THROUGH MANAGED WINE PORTFOLIOS
5- THROUGH WINE INVESTMENT FUNDS
– Sommelier Capital Investors
[q unit=”2″ topic=”6″] MOST IMPORTANT WINE EXCHANGE IN THE WORLD
[a] LIV-EX
(London)
[q unit=”2″ topic=”6″] MAIN WINE INVESTMENT PLACES
[a] 1- LONDON
(traditional wine investment hub)
2- HONG-KONG
(government abolished excise duty to become
wine trading hub of eastern asia)
[q unit=”2″ topic=”6″] AUCTION HOUSES
(main companies)
[a] SOTHEBY’S & CHRISTIES SPECIALIZE IN SELLING
HIGH-PRICED INVESTMENT GRADE WINES
[q unit=”2″ topic=”6″] RISK OF AUCTION HOUSES
[a] 1- RISK OF SPOILAGE
2- STORAGE CONDITIONS
3- FRAUDS
[q unit=”2″ topic=”6″] THE 2 MOST FAMOUS WINE AUCTION FRAUDSTERS
[a] 1- Hardy RODENSTOCK
(selling Thomas Jefferson wine collection)
2- Rudy KURNIAWAN
(caught selling Burgundy Domaine Ponsot
vintages that never existed)
[q unit=”2″ topic=”6″] SOLUTION TO WINE FRAUD
[a] SOPHISTICATED ANTI-COUNTERFEITING TECHNIQUES
[q unit=”2″ topic=”6″] KEY SUB-SECTORS OF THE HOSPITALITY SECTOR
[a] BARS & RESTAURANTS
[q unit=”2″ topic=”6″] AVERAGE PRICE OF A BOTTLE OF WINE SOLD IN THE
HOSPITALITY SECTOR
[a] CONSIDERABLY HIGHER THAN IN RETAIL
[q unit=”2″ topic=”6″] SPECIALIST WINE BARS
(main characteristics)
[a] 1- SPECIALIZE IN SELLING WINE
2- KNOWLEDGEABLE & WELL TRAINED STAFF
3- LESS KNOWN WINE REGIONS
4- LESS KNOWN GRAPE VARIETIES
5- HIGH INVOLVEMENT CONSUMERS
6- PAY ABOVE AVERAGE FOR QUALITY
7- DO NOT OFFER BIG BRAND NAMES
8- CANNOT COMPETE ON PRICES WITH LARGER BAR CHAINS
[q unit=”2″ topic=”6″] LARGE CHAINS OF WINE BARS
(key feature)
[a] ENOUGH VOLUME TO HAVE THEIR OWN LABEL WINES
[q unit=”2″ topic=”6″] COMPANY SPECIALIZED IN WINE BARS
IN AIRPORT LOUNGES
[a] VINO-VOLO
(USA)
[q unit=”2″ topic=”6″] GENERAL BARS
(main characteristics)
[a] 1- LESS WINE FOCUS
2- WINE IS JUST ONE OF THE DRINKS ON OFFER
3- WINES OFFERED
– well known producers/brands
– well known grape varieties
-well known grape varieties
4- MAINLY INEXPENSIVE TO MID-PRICED WINES
5- WINES THAT APPEAL TO WIDE RANGE OF PEOPLE
6- WINES DRINKABLE WITH or WITHOUT FOODS
7- SOME BARS HAVE SPECIFIC THEMES
[q unit=”2″ topic=”6″] BAR PRICES MARK-UP
[a] 1- PRICES ARE HIGHER THAN IN SHOPS
2- TO AVOID PRICE COMPARISONS SOME PRODUCERS
MAKE WINES ONLY SOLD TO THE HOSPITALITY SECTOR
[q unit=”2″ topic=”6″] THE 3 RESTAURANT CATEGORIES
[a] 1- NON DESTINATION RESTAURANTS
2- CASUAL RESTAURANTS
3- FINE DINING RESTAURANTS
[q unit=”2″ topic=”6″] NON-DESTINATION RESTAURANTS
(characteristics)
[a] 1- THE MEAL IS NOT THE MAIN FOCUS
OF THE LUNCHTIME / EVENING
2- WINES NEED TO APPEAL TO THE LARGER BASE POSSIBLE
– well known brands
– well known grape varieties
– well known regions
[q unit=”2″ topic=”6″] CASUAL DINING RESTAURANTS
(main characteristics)
[a] 1- FALL BETWEEN NON-DESTINATION & FINE DINING
2- FROM QUICK MEALS TO LONGER MEALS
3- MID-PRICED TO PREMIUM PRICED
4- WINES OFFERED
– a mix of well known & lesser known regions / grape varieties
[q unit=”2″ topic=”6″] FINE DINING
(main characteristics)
[a] 1- DESTINATION RESTAURANTS
2- MEAL = MAIN FOCUS OF VISIT
3- ONE OR MORE MICHELIN STAR HEAD CHEF
4- FOOD & WINE PAIRING PARTICULARLY IMPORTANT
5- WELL TRAINED & KNOWLEDGEABLE STAFF
6- WINES OFFERED
– super premium wines
– best vintages
– available in small quantities
[q unit=”2″ topic=”6″] FINE DINING STAFF
[a] 1- HEAD SOMMELIER
(prestigious position + expensive)
2- HIGHLY TRAINED & KNWOLEDGEABLE STAFF
[x] GOOD JOB!! [restart]
[/qdeck]