How Coronavirus impacted the wine world and the Cru Wine team

Dear Clients and Followers,

This summer has been particularly hard for a lot of industries including wine due to the pandemic. It has affected the whole supply chain, from winemakers to distribution. Hospitality has been the most impacted industry around wine with all restaurants, bars and hotels struggling to stay financially alive and the Wine trade has seen its highs and lows depending on markets and activities.

We wanted to show at Cru how the team was reacting during such a complicated period by giving you insights on how the team was working in order to make the best out of this situation.

According to Liv-Ex on their after-crisis report, the main way to react as a wine business to this situation is to accelerate digital strategy.
We enlarged our presence online and Adam Wilkinson, our Head of Insight explains :

“Due to the climate over the last 6 months we have seen the world move even  further into the digital space.
As we unfortunately have not been able to greet and chat to our valued customers at our events, we have been busy building out our digital space and technical infrastructure to be able to better serve our customers online.
Over the last 6 months we have successfully gone through a big IT system change which has not only ensured the smooth operation of the business whilst the team has had to work remotely but also has laid the platform to enable us to serve our customers with a much-improved online experience.
The investment and progress made in the space continues to highlight the importance we place on utilising data and technology to continue making smart decisions and providing the best wines at the best prices.”

On the sales side of our company, we also encountered several challenges but also opportunities as summed up by Amaury, Area Sales Manager :

In charge of the market for Cru Wine in Asia and especially in Hong Kong, where our business here has been seriously impacted the first 2 months of 2020. The closure of restaurants, bars and casinos in Hong Kong and Macau, seriously impacted the middle range wines business.
In Europe, further to governments’ restrictions, the warehouse and logistic companies have seriously reduced their work. This is a significant problem when you are working  with Asian wine merchants as the ETA is a key point in the negotiation of each deals.
The temporary closure of restaurants in Europe and especially France, pushed them to sell some of their prestigious wine stock to create some cash flow. We have seen many rare bottles at attractive prices coming back to the market. Finally, the fine wines market seems to be significantly impacted and the value of these wines is clearly decreasing.”

The pandemic has caused unprecedented times, however, we have come through it as a company well, having even expanded our team. Gregory Swartberg, CEO of Cru Wine, concludes:

When Covid-19 struck Europe in March/April with a full lockdown, massive furlough programs, a number of US stock market trading halts of -13% combined with the historical lows of Oil hitting -40US$, I was certainly in uncharted territory as a business owner. I did not know the extent of the social and economic catastrophe, but I knew that we had to be very quick in our response and adapt to the situation. We managed to launch a home delivery product within a 3-week turnaround, we managed to allocate resources to regions that were starting to do better, which at the time was Asia, and we focused on home deliveries. So far so good, we have shown tremendous team spirit during this hard time, the business is thriving and we managed to close our fiscal year in June 2020 with more than 80% revenue versus the previous year while improving our underlying margins. Some of our recent internal system developments and increased access to allocations will further bear its fruits in the years to come.”

We also improved our website so that every user could log into his account and manage his orders online. If you did not receive your log in details please feel free to send an email to your account manager at info@cru-wine.com.

Thank you to our dear clients for sticking with us on such a complicated period and thank you everyone dedicated in helping others in these tough times.

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