Entry for MWWC #28: Smile
Until about two weeks ago I’d drafted a completely different entry to this month’s Monthly Wine Writers’ Challenge. The topic is “smile”. I’d written some guff about press trips and how amazing it was we get to do them. I’d just arrived back from 3 days in the Douro and was high on life. I can’t believe how long ago that feels now.
Since then I’ve been brought back down to the reality of what it’s like to run a company in post-Brexit Britain that deals primarily with bringing in wine from France and selling it in the UK. Every single day is like another kick in the balls.
This isn’t going to be a rant about who voted for Brexit. I’m not a “you’re all fucking idiots” kind of person. People voted on how they saw it and that’s what you’re meant to do. The blame, for me, lies on the doorstep of those political leaders who ran the Leave campaign on the back of lies, half-truths, and (most importantly) a complete lack of any idea what on earth to do if they actually won. I genuinely don’t think they thought they would. Is treason too strong a word?
I would say fast forward, but we don’t have to fast forward that much to see the disaster that’s now unfolding. The British Pound (GBP) is tanking. Foreign investment has slowed to an absolute trickle as no-one has the first idea about what the business landscape will look like in 10, 5, or even 2 years time. What this means is that buying anything from abroad is all of a sudden extremely expensive.
Importing Is Really Tough
So what’s this got to do with wine I hear you ask? Well the UK imports a lot of wine. The English and Welsh wine scene is exciting and growing fast, but it’s still pretty small fry in terms of volumes drunk. So we get our wine in from elsewhere. 20h33, my company, is a Bordeaux specialist and bring it all in from France. And it’s here that the exchange rate is biting hard.
Going from pre-Brexit levels of 1.4 euros to the pound to today’s level of just under 1.1? Well my base costs have increased over 25% in a month or so. Trying to trade is tough. You’ve got producers that couldn’t give a shit what trouble you’re in, they’re putting prices up slowly. You’ve also got a consumer base that has been conditioned to think anything more than £10 a bottle is a fortune, so you’re struggling to put prices up yourself. All in all, it’s your margin that goes if you want to stay in business and try and ride out the storm.
It means a lot more work and a lot more stress for a LOT less margin. That’s the reality of working as a small business in the UK wine (or any importing) scene right now. And it’s thoroughly depressing. I haven’t been so low about the state of my own country’s outlook in my entire life.
Could It Be Worse?
I keep trying to tell myself that it could be worse. I could be importing wines from the US. The dollar is a strong currency right now, unlike the euro. Where are we down to now? 1.2 dollars to the pound? Can’t see myself on a holiday to the other side of the pond anytime soon! But then all the US needs is a Trump victory in the election and the USD will likely fall like a stone too as foreign investment will get panicky there too. Then maybe it’s time to knock Bordeaux on the head and start cranking out the Oregon Pinots.
So now we’re back to the topic of the MWWC: “Smile”. I don’t think I’ve smiled once in two weeks. I didn’t join the wine industry to feel like this. Hopefully this doesn’t last long! I’ll give it 10 to 20 years til we see signs of recovery…