Posts

Wine Cheaper than Water? Crikey!

Stock-up time! We heard it through the grapevine… there’s a wine glut in Australia to the point that wine prices have been driven lower than some bottled waters. Where are we headed here? Maybe the 21st-century religious miracle will be changing wine into water! (Last fall, we posted here about cheaper-than-water alcohol in the UK.) According to www.news.com.au,

Major wine retailer Dan Murphy’s is currently selling cleanskins for $1.99 a bottle – cheaper than some bottled water – due to the oversupply crisis that has led to some vineyard owners leaving grapes to wither on the vine.
The unprecedented meltdown in the Oz wine biz has also precipitated a fire-sale of unprofitable vineyards. Australia’s biggest winemaker, Foster’s, is selling 31 of its vineyards across the country. Winemakers pow-wowed at an emergency meeting and concluded that 20% of vines needed to be phased out in the next three years to correct imbalance. 
Strong export sales led to over-optimistic outlooks for Australia’s wine industry and a doubling of vine-producing areas over the past decade. But forecasts of more than $3 billion in export sales by next year have been dashed by overseas competition, an excess of cheaper wines and the global financial crisis.
 

Old price points get smashed

The (UK) Times Online reports today,

Supermarkets selling alcohol cheaper than water

Research has found that it costs less to quench your thirst with alcohol than bottled water at leading supermarkets. Discounted own-brand alcohol is sold for as little as 23p per can, according to the drink and drug charity Addaction. This research comes on the eve of Government plans to tackle binge drinking.

I wonder where this product fits in the value proposition?

Does this mean that water is ridiculously expensive or that booze is incredibly cheap? Well, both. Competition among shops and supermarkets has led to alcohol prices that average 8% less than the recommended retail price. Some items, especially generic “value brands” are as much as 40% below retail. And, the research found that when alcohol is considered as a proportion of income, it is almost 70% more affordable today than it was 1980.

So go ahead and cry in your beer, just don’t weep in the water.