Strong Demand Could Post Record Sales For Champagne Makers

Champagne producers in France are celebrating record sales for the year. This unexpected turnaround from last year’s pandemic-related problems is giving them confidence that they will be able to withstand the Omicron variant.

According to Jean-Marie Barillere, president of UMC champagne industry group, sales in 2021 will surpass 5.5 billion euros ($6.2billion). This is higher than the previous peak of 5 billion euros just two years before the coronavirus pandemic.

“It’s been huge and so unexpected that we’ve seen some breakdowns in the supply chain, like in all sorts of other products at the moment,” he said.

The rush to re-experience the world-famous sparkling wine may find some champagne connoisseurs short over the year-end holiday season.

According to retail data analyst firm Nielsen, champagne had the highest level of out-of-stock labels among major supermarket chains categories in French supermarkets as early as the beginning of November.

Benoit Melendez, who runs a specialist champagne cellar in central Paris, is witnessing shipments from some suppliers dwindle as well.

“My fear is not to be able to satisfy customers who are looking for specific things (…) and not by December 31.”

The supply crunch of the drink does not indicate an underlying scarcity, as champagne manufacturers have substantial stocks that can be progressively blended for new bottles.

According to Melendez, the strain on supplies has added on to the exceptional 2021 sales, with some manufacturers revising prices higher over the year.

The resurgence in champagne consumption is part of a wider economic recovery as customers recover from the prior waves of lockdowns induced by the pandemic. 

Economists and investors, on the other hand, are concerned that the Omicron variant of the coronavirus may cause economic and business activity to slow down again, particularly in Europe, where some governments have imposed fresh restrictions to curb the spread of the pandemic.

Barillere, like Melendez, sees a propensity to party at home, developed throughout the epidemic, as supporting champagne demand even if venues are reopened.

“Since the vaccines and the end of summer, people have been saying we’ll have to live with this and that means simply living,” Melendez said.

(Adapted from WineBusiness.com)



Categories: Economy & Finance, Entrepreneurship, Strategy, Sustainability, Uncategorized

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