Monday, October 18, 2010

Debate a Bubble - What Price For Cheap Champagne?

Debate a Bubble - What Price For Cheap Champagne?

Link to Debate a Bubble - Champagne News and Reviews

What Price For Cheap Champagne?

Posted: 18 Oct 2010 05:25 AM PDT

I was in an Intermarch√©  supermarket here in Champagne the other day and decided to buy one of the cheap champagnes to see what it was like.

Intermarch√© champagne I grabbed a bottle of Colin-Guillaume for 16€.

It wasn't bad at all for the price. I wouldn't go out and buy cases of the stuff (in fact I wouldn't normally buy supermarket champagne at all) but it went down pretty well.

This got me thinking about the price of champagne in general and in particular the deals that are sure to be around this Christmas, particularly in the U.K. 

People are already suggesting that you'll be able to buy champagne at £10 a bottle in the U.K. and I wondered how this was possible.

I started doing a little digging and came across a report in the local Champagne newspaper - L'Union-  on this very subject. The article was written this time last year but the figures are probably pretty close to the truth this year as well.

L'Union had calculated the cost price of a bottle of champagne as being 8 euros. Add on say 25 -50 centimes for transport and you get a total price of, say, 8.50 euros a bottle. About £7.45 GBP at today's exchange rate. If you live outside the U.K. please do the sums using your own currency's exchange rate.

In the U.K. you have to pay £2.16 duty on a bottle of champagne ( so that makes a total of £9.61 so far) and then you have to add Value Added Tax at 17.5% on top of that. So we're now up to a retail price of £11.29 if the retailer makes no profit at all.

So if a bottle sells for less than this it suggests that either

  • the producer in Champagne is selling at a loss, just to get some cash in, or
  • the supermarket is selling at a loss, probably to attract customers and sell them other goods at a normal profit margin.

Certainly this sort of thing happens a lot and if you're looking for a cheap champagne for a party or large function when no one is really going to be bothered too much what they are drinking, then cheap champagnes can be fine.

Don't forget mind though that these are one-off deals. Usually a given number of bottles only are sold at this sort of price, so if you want to buy more a few weeks later, you probably won't find the same price and possibly not even the same champagne.

A more weighty question though is what do you think of champagne at this sort of price?

Do you think that prices as low as this ruin the image of champagne and perhaps ruin the very reason you want to buy it in the first place?

Or are you happy to buy champagne as cheaply as possible?

 Perhaps yet again you'd pay a bit more for a champagne for a more special occasion?

I'd love to hear what you think so do post a reply on this blog or send me an e-mail to jiles@madaboutbubbly.com 

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