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Bordeaux’s regional share of trade shows fluctuations across August

By | Latest News, Wine Investment

In our previous blog, a fine wine area profile of Bordeaux, we reported on Bordeaux’s regional share of trade by value claiming nearly 70% of the global fine wine market near the end of July.

At the start of August, it was calculated by Liv-ex that Bordeaux’s total regional share of trade by value for July accounted for over three quarters of the market. That was 70% higher than the next region, Burgundy.

One month on, and Bordeaux’s regional share of trade by value for August fell to 66.9%. Bordeaux’s June share was 65.5%, and the gradual build throughout July may have convinced some that it would continue into August.

Here, our team of experts at The London Wine Cellar break down these latest fine wine investment developments.

Bordeaux’s regional share of trade dipped in August

In the middle of August, statistics from Liv-ex showed that Bordeaux’s share of the fine wine market had suddenly dropped to a new weekly low for its performance in 2015.

Bordeaux started the month in a strong position following a 75.2% market share average for July. But the region was claiming nearly 10% less in the first week of August, and by the second the region was accounting for only 52.3% of all trade.

Which regions were taking over?

Having witnessed a record high 10.5% share of trade in June, and a July share that was far above its 2014 average of 5%, Italy came into August with a market share of 15.2%.

According to Liv-ex, the region performed well with lots of positive activity around the Super Tuscan Sassicaia 2011. This vintage, trading at less than £1,000 per 12×75, is one of the cheapest Super Tuscans available and has achieved critical acclaim with a soaring score of 94 from wine critic James Suckling.

Later on in the month, internationally recognised Italian Super Tuscans continued to do well thanks to the performances from Tignanello 2009 (score of 94 from the wine critic Antonio Galloni) and Rampolla Alceo 2007 (score of 97 from James Suckling).

At the same time, Champagne increased from a 4.2% regional share at the start of August to 21.1% during the middle, when Bordeaux’s regional share started to dip.

The future of Bordeaux, Italy and Champagne

While August was certainly a slow month for Bordeaux, it’s back on track without a doubt.

The Bordeaux region has returned to its usual standard of market domination once again, coming into September with 75.8% of the weekly regional share of trade by value. This is largely due to high levels of interest in its First Growth wines which accounted for four of the five top traded wines by value between 28 Aug – 3rd Sept.

Among Bordeaux wines, Italy and Champagne both have bottles on the top 5 traded by volume table for this same time period.

Italy’s recent big successes have finally slowed to a 6.4% regional share of trade by value which is still up on its 2014 average. Champagne, meanwhile, is still enjoying an elevated 11.6% regional share of trade with the Salon, Mesnil 1999 claiming 6.9% of the total share of traded wines and boasting a hefty trade price of £2,080.

 

As you can probably tell from the information above, in the world of fine wine investment months and weeks can take on far more significance than you may have first thought.

If you’re curious about the value of the wine in your or somebody else’s possession, don’t hesitate to get in touch with our team of wine experts.

We can tell you about the current state of the market, value your wine over the phone and tell you about our wine payment and collection services.

How to ensure an honest wine sale

By | Latest News, Wine Investment

It’s no secret that fine wine has become one of the best performing alternative investments in recent years. Knight Frank’s 2014 Luxury Investment Index revealed that assets like fine wine had outstripped the FTSE100 within the last decade.

Needless to say, for those with high-end cases, fine wine could be the deciding factor behind luxurious lifestyle decisions such as early retirement. So if you’ve invested in fine wine or own wine that could be valuable, you may be wondering how you can guarantee a fair sale. For more information on how to sell wine online, follow the link.

Unfortunately, the wine investment industry is rife with risk, and finding a trustworthy method for selling fine wine can be very difficult. There are scammers posturing as professionals, companies making promises they cannot deliver and scores of businesses specialising in offering deceptively low bids.

Here is some honest advice on ensuring an honest wine sale.

 

Transparency

Fine wine can be exceptionally valuable and should be treated as a serious investment. Just like with traditional investments, fine wine owners should only be ready to sell when they know exactly how they will be doing business.

It will be essential to seek the advice of companies who are willing to share information about themselves. Ultimately, the more you know about a wine buyer, the better. For example, with The London Wine Cellar, our customers can learn about our company: not only can they see that we are a proud trading name of Hatton & Edwards, they can also meet our team of wine industry experts and learn about their experience in fine wine investment.

Even better than being able to meet the team, free guides on how a company purchases wine can help sellers rule out any nasty surprises. This kind of easily accessible information regarding wine payment and collection is a key indicator of a trustworthy wine buying company.

 

Valuation and generating competitive bids

Free advice on wine valuation can be sought in a number of locations. Sellers can go to wine shops, create discussions on wine forums or consult with friends and family.

The most important valuation will be the one conducted by the wine buyer. Some wine buyers will offer a free wine valuation service, however; sellers must bear in mind that the quotes provided may not always be reflective of the wine’s true value.

Depending on the company’s intent, some valuations will be unrealistically high or low. Regardless of this fact, any offer can still be useful for generating competitive bids from other companies. This process should help sellers arrive at an approximate value for their wine, and give them more confidence when they decide to sell.

In conjunction with our free wine valuation service, we also provide a free wine inspection guide. This enables our customers to understand how much their wine could be worth before consulting with professionals.

 

Get expert eyes on the case

Whether your wine is in a bonded warehouse or your cellar, an excellent way to gauge the trustworthiness of a buyer is to have the wine inspected in person by a professional. This kind of service should come at no added expense and reassure any seller that they are dealing with an honest buyer.

Many wine buying companies will insist that sellers actually send their wines to be inspected. This risky process could result in the wine bottle becoming lost, damaged and can disrupt the harmony of a sale. After all, if you’ve already sent your wine, you may feel as though you’re on the back-foot.

When deterioration of the label can account for a value loss of 5-15%, sending a wine bottle to be valued – no matter how carefully it’s packaged – is not advised.

Following a professional examination, both the wine buyer and seller can be confident that they are entering an agreement that’s fair and based on fact.

At The London Wine Cellar we will happily travel to evaluate domestically stored wine. We can perform a complimentary cataloguing and analysis and arrange a sale on the very same day with no obligation required from the seller. If your wine is stored in bond, The London Wine Cellar will pay for the bonded warehouse personnel to carry out a valuation at no extra cost.

 

Find an enthusiast who really wants your wine

Even though the incentive is certainly financial, the process of selling fine wine should seldom be purely motivated by economic gain. For example, a wine seller is far more likely to experience an honest wine sale with a wine enthusiast rather than somebody who simply offers a large sum of money

It is advisable to remember that fine wine, unlike with oil or stocks, is a subject that many are truly passionate about. Wine buyers should be expected to prove their knowledge of the wine in question, and therefore demonstrate that their offer reflects what they know about the wine.

This can confirm the authenticity of a wine buying operation and promise that the wine will be going somewhere where it is appreciated as it should be.

At The London Wine Cellar, we make sure that potential wine sellers can see the wines we want to buy. Furthermore, with our years of experience in the wine industry, we encourage customers to get in touch with us so that we can talk about their wine in detail.

 

Wine Area Profile: Bordeaux

By | Latest News, Wine Investment

Informed by years of experience in the wine industry, The London Wine Cellar is a company of experts connected by a shared passion for wine. When we’re not helping customers understand the contents of their cellar or wine investments, we’re talking trade and staying up-to-date with the global marketplace for fine wine, Liv-ex.

The culmination of July saw Bordeaux’s regional share of trade by value claiming nearly 70% of the market. Its Pontet Canet 2009, a wine with a 100-point score from Robert Parker, was the top most-traded wine by value. Interestingly, this had only recently been listed by Liv-ex as one of the less expensive perfect wines.

If you’re lucky enough to be an owner, you may well be wondering how much the bottles of Bordeaux in your collection are worth.

Here, the London Wine Cellar not only explore the rich history of winemaking in Bordeaux, but also look at the kind of bottle that could release a substantial financial sum.

A brief history of wine in Bordeaux

Bordeaux has a long history of wine production, so it’s hardly surprising that it commands such authority among oenophiles.

In order to celebrate the best of France, the French Emperor Napoleon III requested a wine classification system for the red wines of the Gironde in 1855. Much of this massively influential system is still in place today, and though classifications are not always accurate when it comes to the taste and quality of wine, they still have a significant effect on value.

There are many wines that the region is known for, and the kind of wine grapes that grow vary with the area of Bordeaux. For example, grapes that grow on the Right or Left Bank are wildly different.

Vineyard veterans now understand that the grapes of the Left Bank go on to create full-bodied blends that have a greater amount of tannins, alcohol and acidity. It has been said that the wines of the Left Bank age better than the Right, and it could be for this reason that the wines of the Left Bank made the region famous.

The Right Bank’s most common grape is Merlot, a type that’s well-known for its soft flavour and its ability to be turned into wine much more quickly. As a result the Right Bank usually produces wines that are less expensive.

What makes a great Bordeaux wine?

Often the significant aspects taken into account are the vintage and the chateau. For example a red Bordeaux wine from 1982, a very good year for the region, will be highly coveted due to its age and lasting ability.

In 1982 it was the Merlot based wines that truly stood out and Petrus is famed for making some of its best wine that year. Thus a Merlot based blend from Petrus with a 1982 vintage would be considered a very fine wine indeed.

It’s important to note that research should always be undertaken to determine how fine a wine is, regardless of what you think you know.

How much is Bordeaux wine worth?

The value of a wine depends on many variables. Of course the vintage and chateau will always be important, but the bottle quality is also key. This is why proper storage is integral to a valuable wine collection.

The Bordeaux wines that we are most keen to purchase at The London Wine Cellar include wines from the first growth classification alongside others known for their illustrious winemaking capabilities such as Petrus and Latour. For a full list of Bordeaux wines we are actively looking for, please see our Wines We Buy page.

Researching the vintage and chateaux of a wine can help you determine value but the demand in the world wine market is also important. The London Wine Cellar provides a free wine valuation service which can give you a better idea of what your wines are worth, providing they meet the quality check.

If you have been collecting Bordeaux wines in your lifetime and would like to free up some cash for house renovations or retirement plans it could be time to start thinking about their value, lasting ability and ultimately, whether it’s time to sell your wine.

Wine Investment Scams: Cold Calling

By | Latest News, Wine Investment

Wine investment scams have become prevalent since the late 90s, with the popularisation of the fine wine investment industry. The easiest way to avoid these poisonous scammers is to ignore anyone selling you an investment via a cold call – if this investment is so good and so profitable why would they need to hassle you at home to spend your money.

It may sound obvious that if somebody cold calls and offers a great deal that it will be a scam. But countless new individuals each day fall victim to these ‘too good to be true’ offers and lose vast sums of money. Here’s how this particular scam works.

Cold callers draw you in with unbelievable figures

These Wine Investment companies buy large databases of potential Investors, targeted based upon their financial status and age. Scammers aim for those with cash savings, often that they inherited, and to be deemed vulnerable or less savvy.

When we say scammers we do not necessarily mean that these companies are not producing the wine that has been sold but are immorally inflating the price. These companies will then exaggerate the growth you should expect. Whenever an update or valuation is requested by the client you can bet your bottom dollar that the update will be made in the form of a verbal one and the numbers reported are fabrications meant to attract the investor to part with yet further doomed capital.

Cold callers will often pretend to be working for or in conjunction with a well known wine investment company. Dropping the name of a trusted company starts to nurture trust between themselves and the potential fraud victim. Many will believe a scam if it is attached to a prestigious company name.

They will be persistent, cold calling regularly with great deals that should not be missed. This can go on for weeks or months, in the hopes of convincing the investor. In our experience many elderly investors have agreed to invest just in the hope to stop the harassing calls.

Even the paperwork will look legitimate

Official looking documents will often convince any investor of the legitimacy of the cold callers offer. The fraudster will often send investors the paperwork on their wine once the sale has been finalised, giving them what they feel is a safety net of a paper trail.

The investor will likely not find anything obvious to be suspicious of with even the simplest technology making it easy to forge documents that look entirely legitimate. Investors will often have no idea they have been scammed for years, normally when they try to sell their wine and find that there is nothing to sell or what is there is worth half of what they invested.

Drawn out proceedings are a bad sign

Once the investor chooses to sell their wine the scammer will insist that they should wait. Excuses like ‘nobody is selling wine at the moment’, ‘the market will be better in the winter’, ‘Lets wait for the Chinese New Year next February’ are frequently used.

If a company is being slow/reluctant to sell an investor’s wine 9/10 times this signifies there is a chronic problem.

We have also encountered many companies where they have started to chase their tales trying to fill in gaps of missed purchases, they attempt to prolong proceedings in a desperate effort to buy in time and not be discovered. This always leads to the company going into liquidation within 12-24 months.

Average investments lost to scams is valued around £6,000

The average amount of investment lost on scams is just under £6,000, but investors have been known to lose up to £300,000 in the wine investment industry.

Clients of these unscrupulous companies pay between 30-50% too much for their wines meaning there was never any scope whatsoever to profit from their investment.

Never trust a cold caller. A reputable company will never use high pressure sales techniques on potential clients, if they have a good reputation they shouldn’t need to.

The London Wine Cellar operates with complete transparency and openness delivering their client a line-by-line market price breakdown of their stock and arming them with all the information they need to make an informed decision. Clients quickly know they have placed their trust in the right place. We aim to make people aware of the scams in the industry and help release people from bad investments so that they can avoid losing further money and in many cases racking up pointless storage debts.

If a company offers to buy back wine at a profit for the investor it is likely that may have taken data from a wine company they used to work at. The convince the investor to transfer the wine over, once they have ownership they disappear and never pay the investor. Use trusted companies like our own to value your wine in order to avoid such scams, and if you come across this please inform us and more importantly report it to the police.

 

fine wine storage, an example of a cellar-based approach

Fine Wine Storage: Important Tips

By | Latest News, Wine Investment
  • Please note: We are not a wine storage company.


Everyone has a fine wine that they’re not planning on drinking right away. Whether it’s a nice bottle received as a present or a wine bought on release, maintaining ideal conditions will be important if you’re considering long-term storage.

While it’s well known that fine wine can improve with age – in terms of flavour and value – it can also deteriorate if stored in lacklustre conditions. If you are serious about storing wines to mature them to their maximum value, professional storage is key.

In many facilities wine is stored under bond in temperature-controlled storage. This gives it the best chance to reach its full potential both in terms of taste and value.

Fine wine storage tips

The three factors that have the most direct impact on a wine’s condition:

  1. Maintain a consistent temperature: Wine hates heat, so fluctuations in temperature can cause serious problems. The ideal temperature to store wine at is 12-13 degrees centigrade, however, a degree or two either side is still ok. Consistency is key. Don’t let it get too cold; a garage may be cool in the summer but your wines could freeze in the winter.

  2. Control the lighting: UV is not good for fine wine; it’s the reason most red wine comes in coloured bottles; think sunglasses for wine! Even artificial lights can fade labels; they also have an effect on temperature. Basically, store wines in the dark and don’t leave the lights on for too long.

  3. Keep bottles horizontal and a degree of humidity: Wine has always been stored lying down. It keeps the liquid against the cork, which stops it drying out. The cork must also be stopped from drying out, thus some degree of humidity is required. Keeping wine on its side is also space efficient. If your wine came in a wooden box it’s best to keep it there.

So where should I keep my fine wine?

If you don’t have professional wine storage facilities or an underground cellar there are some simple steps you can take.

Avoid the kitchen, laundry and boiler room at all costs; find a consistently cool dark part of your house and choose a spot away from natural light.

For those willing to invest in having professional-grade storage in the home, temperature controlled wine coolers are the best option around. For those of you who used to stick them in a rack by the AGA in the kitchen, try the cupboard under the stairs instead!

Looking to sell your fine wine collection? Get in touch with The London Wine Cellar today.

More Wine Investment Firms Wound Up

By | Latest News, Wine Investment

A British court has dissolved two wine investment companies that preyed on investors who had already been stung. Two companies who “cynically targeted” people who had lost money in wine investments have been wound up by a British court.

In the latest in a series of wine investment company collapses, Capital Bordeaux Investments Limited and Capital Bordeaux Investment Corporate Limited were dissolved at the High Court in London last week. The two London-based companies claimed they could help victims of previous wine investment scams and falsely represented that they could assist in recovering previous losses. Instead, the company asked for more money from victims.

Investors were told that the company would be able to recover and sell their previous wine investments – even if these were made through a company that had gone into liquidation – but the investor was required to buy more wine through Capital Bordeaux Investments Limited.

Commenting on the case, Colin Cronin, an investigation supervisor with the Insolvency Service, said: “These companies cynically targeted people who had already lost money in other wine investment scams and exploited their desire to try and recover some of their original investment. The companies were incapable of recovering such losses. Significantly, none of the funds received from investors were used to buy wine and were instead used for the benefit of those in control of the companies. “I would urge victims of wine investment scams to exercise great caution if approached by companies which purport to be able to assist in recovering their past losses.”

Capital Bordeaux Investment Corporate allowed its bank account to be used to receive the investment money and raked in £243,980 ($411,000). The investigation found no evidence to show that any wine was bought by either Capital Bordeaux Investments or Capital Bordeaux Investment Corporate or that either company made any attempt to recover previous losses suffered by investors.

People investing money in fine wine in the U.K. have lost an estimated £100m ($168.4m) over the last six years following the collapse of wine investment firms, with as many as 50 firms having gone under in that period.  Former clients of Worldwide Wine Investments and Bordeaux UK Ltd were among those targeted.

Nadim Ailyan, the insolvency practitioner who handled the liquidation of Bordeaux UK, said: “There are certainly strong elements of mismanagement on a colossal scale.” Ailyan said Bordeaux UK was one of eight wine investment company collapses his company had dealt with. But the problem is likely to be even more widespread: “I would estimate … there have been at least 50 such companies which have been dealt with by other insolvency firms. Certainly tens of millions, potentially more than £100m may have been lost.”

Building trust in a booming fine wine market

By | Latest News, Wine Investment

The grape has provided us with something to mark every occasion. However in more recent years fine wine has more and more been seen as an investment, with wine prices rising aggressively between 1996-2008, outperforming many other forms of investment, providing a safe haven compared to traditional stocks/shares or the buy-to-let markets with their wild fluctuations.

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