Torres Plans for China – Brief Article

Kevin Sinclair

The mighty Spanish House of Torres has significantly altered strategies for planned expansion in China. Three years ago, there were hopes of planting extensive vineyards in Northern China’s Hebei province. Then the wine market faltered and reality set in.

Although Torres has sent technicians with sample plantings to a site where it is in joint venture to bottle wine, the vineyards have yet to bloom. Instead, the company is working on establishing a wide distribution network, says Joan Casals, area manager.

“We’re creating a solid base,” Casals explains. Casals was posted to China in 1996 when owner Miguel Torres hoped to take part in the anticipated China wine boom. That expansion took place, but a combination of far too many imports and the Asian economic virus caused marketing problems. Prices collapsed.

Torres created a joint venture with the huge Great Wall Winery and foreign-owned Montrose Food and Wine. The Spaniards import about 50,000 liters of wine a year in flexitanks (plastic bags inside steel containers) and bottle this Spanish wine in China with the Tres Torres label. It sells locally for 89RMB (about US$8.50.)

Another 2,000 cases grown and bottled on their Pened[grave{e}]s estates near Barcelona are sold for about 130RMB (about US$13) under the familiar international Sangre de Toro label. Both are distributed through Beijing and Shanghai networks under the joint venture.

But Casals has started setting up another network, a 100% Torres-owned company, with offices in the provincial cities of Wuhan, Chengdu, Guangzhou and Xiamen; these are population centers for about 400 million people.

“When a wine culture seriously develops in China, we will have our own solid distribution base,” Casals vows. “There’s no sign of that happening yet.”

Once those regional distribution offices are established, he plans to link with smaller local companies which sell in secondary and tertiary cities.

COPYRIGHT 2000 Hiaring Company

COPYRIGHT 2000 Gale Group

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