For a pricey $1320 you can get your hands on the latest market analysis of China’s burgeoning wine market.

This report covers the market for alcoholic wine in the People’s Republic of China. The report covers the red, white and blended grape and sparkling wines sectors. There is also some coverage of fruit wines (normally referred to as ‘berry wines’ in China) in the report. This report does not include yellow rice wine, or Shaoxing wine.

KEY REPORT FEATURES

This recently updated report includes:
- An overview of China’s total food market with sales statistics up to interim 2009;
- The total value and volume of wine consumption, including consumption channel breakdowns and by type of wine, up to interim 2009;
- The total value and volume of wine retail sales, including by sector, up to interim 2009;
- Leading manufacturer market shares based on revenues to 2008;
- Volume & value forecast the meat market in China up to 2014;
- The retail wine market background and current issues;
- Marketing & distribution;
- SWOT analysis
- Key manufacturer profiles
- Key contacts & trade events;
- Overview of China’s demographics and macroeconomics

EXECUTIVE SUMMARY

China claims over 160,000 acres of vineyards nationwide, but much is in remote areas, such as those in Tibet near Kazakhstan, where Silk Road traders brought seeds centuries ago. There is also a small native grape (Vitus thunbergii) that grows wild north of Shanghai. And Russian visitors brought plantings of Muscat and Ratsiteli to China in the early twentieth century.

Although having been started at the beginning of the 20th century, the wine industry in China has only recently begun to develop into a significant market. Chinese consumers have tended to stick to what they know, being beer and grain spirits – drinks that offer a higher alcohol level per unit than wine.

However, wines have attained consumer acceptance, not least due to Chinese politburo member Li Peng, who decreed that state banquets should be lubricated with wine instead of spirits in 1996. The influence of western eating and drinking habits have been key in this, as have rising average incomes in China. Indeed, wine is now becoming the fashionable drink for the wealthy younger generations in China’s cities, and the “badge” drink of China’s wealthiest élite.

The value of the market has more than doubled over the last seven years, and has become much more sophisticated. Not only are there more foreign wine imports available in restaurants and in the shops, but the number, variety and quality of domestic wines has also increased. This has served the market by providing local consumers with a greater array of cheaper products to try.

However, the domestic market has moved on, and domestic wines are now reaching a level of quality that they can compete on price with imported wines, and even look to developing an export market. However, the domestic market is where most Chinese wineries are looking to develop their sales. With about 600 million young Chinese, all exploring new types of alcoholic drinks, the potential market for sales of wine in the future is great.

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Mir Global Marketing LLC has completed it’s summer tour of China, and what a journey is has been! What do we have to report? Well, quite a bit. Since it is too much to compile into one simple blog entry, I have decided to begin with some travel advice and general words of wisdom about doing business in China.

July 13 — New York City –> Beijing (12.5 hours on Continental’s direct flight.) Highly recommend anyone traveling to China from the New York City area and not obligated to any specific carrier book their ticket on this flight. You save between 4-8 hours in additional travel time / transfer time at airports. You do not risk missing a connecting flight, and the service on the plane is quite good for a US owned airline. The one negative side is the cranky American flight attendants, which you do not find if you’re traveling JAL, Cathay, Asiana, etc.

Arrival in Beijing was quick and easy. Customs allowed me to pass with more wine than I was probably legally allowed to bring, I recovered from jet lag quite fast and was out on the town showcasing our wines from Chile and Argentina by my second night.

After reconvening with Xu Wenquan, Mir Global Marketing’s director of sales in China/ Asia we set out a game plan for how to best approach diverse selection of potential buyers / contacts. We would need to fine tune our marketing strategy for three different market segments.

- Chinese government owned entities.

- Chinese entrepreneurs / business owners of bars and night clubs which cater China’s rising middle and upper class. In other words, the sons and daughters of wealthy Chinese who are looking to make a name for themselves and are have chosen to start a business. Not with the goal of attracting foreign customers (although they would not object), bur rather China’s new consumers looking for a good time and some nice drinks.

- Western operated and privately owned establishments in Beijing, Shanghai and Guangzhou. These type of businesses cater to China’s trendy, diverse, metropolitan cultures. I define this group as a mix of foreigners and urban Chinese you would find at a popular bar in a major city like Beijing.

Now, I present a few words of wisdom for those considering to do business in China. These are my own opinions, and I welcome those who would like to discuss any of these points. Please add your comments below or drop me a email, bennett.reiss (at) gmail.com

1. The more interaction you have with China, and the longer you stay, the more you realize how little you truly know and understand the country. Don’t think a mere semester or two of studying in China, speaking Chinese, reading books about “doing business in China,” foreign policy or cultural communication classes make you a expert. They do not.

2. What you learned in business school will not necessarily apply in China. You must cautiously and selectively archive into the back of your mind what you have come to accept as common business practices. What you learned in all those over-priced business classes will usually not apply in China. This is especially true when dealing with Chinese partners, be it from the private sector or a government owned entity.

3. Smile. Even if you are impatient, frustrated, mentally a mess, cranky, jet lagged, suffering from heart break, or angry with life itself… Smile and put a face that mixes happy, calm and confident all in one. The moment you allow what you have bottled up inside to show, vis-à-vis body language or with words, you have lost the battle. You will fail at negotiating a cheaper hotel, you will fail to convince your taxi driver to take the shorter route and you will fail in business negotiation. A calm, collected persona and a smile go a long way in China. Remember this.

4. Keep an open mind and remain flexible as to adapt to any given situation you face. It is popular in western cultures to look for a logical explanation for something you do not understand or a problem you may face. Westerners also tend to believe it is possible to control things like your schedule. Many times in China, there is no logical answer, and controlling things is quite difficult when you are operating in a country as complex and large as China. Accept this now, before you lose your mind, and therefore compromise all the elements I described above in point #3.

5. Dress to impress if you’re doing business. Even if its hot and humid, put on that suit and leave the tie and jacket behind. As they say, you only get one first impression. When you’re dealing with a Chinese businessman/ woman, it is incredibly important to do all in your power to make your first meeting as professional as possible.

** Reminder to all readers, opinions expressed in this entry are my own and should be not treated as fact. Thank you.

~ Bennett Reiss – International Trade Consultant at Mir Global Marketing LLC