(A speech at Vinitaly China 2006, Shanghai)

Wine is the sunrise industry in China. The annual increase rate of Chinese wine market is more than 10%, while the world’s increase rate is less than 1%. Although the Chinese domestic wine brands take up more than 95% of Chinese wine market, the foreign wines are superior in the brewing technology, quality and even the cost performance.

But, we often hear the foreign vintners complained that the Chinese wine market is so complicated that they can’t deal with it. That is the common situation for the foreign vintners who are used to the occident’s wine market. Many foreign vintners thought that good wine and low price would be good market. So, they come to China just seek for the imported wine agents who appreciate their wine. Unfortunately, it is difficult for them to find the suitable cooperation partners. Why? There are several reasons as follows:

1. Due to the wine consumers who enjoy the imported wine is few and they distribute in the China, the imported wine are in buyer’s market. Besides, there are few imported wine agents in China. Because the promotion cost is high in the prophase, it is risk for them to act as a new imported wine’s agent. They will choose the foreign wineries with lots of consideration. So, it is not easy for the foreign vintners to find a suitable wine agent.

2. There are no the professional wine wholesalers in China. All the general agents should establish the distribution channel by themselves. Due to the low density imported wine customers, they should to establish the cooperation relations with the domestic region and the other regions if they want to earn money. That is a hard work for them. Most of the imported wine agents who are in the market exploiting phase are cautious to import the new foreign wines. The mature imported wine agents who established the good distribution relations with the regional agents will be stricter in new wine choosing.

3. With the traditional consumption habit, most of the Chinese customers are low at wine appreciation, which cause only the wine of high recognition and promotion can sell well. Most of the imported wine agents, especially the new one, want to get the funds from the foreign wineries to do the wine promotion in the prophase in order to reduce the market risk. But, most of the foreign wineries are small with a low production. It is not actual for them to put a lot of money into the large Chinese wine market in brand publicizing and advertisement. That is the important obstacle for the foreign vintners to seek for the new cooperation partners.

4. The foreign wineries often see the participation of the wine exhibition in China as the basic channel for business recruiting, but the result of it is not good. As for the vinitaly China, it is the largest and most professional wine exhibition in China now and is held in Shanghai that has many imported wine agents. Due to the large terrain of China, the few imported wine agents in China and most of the spectators are just nearby Shanghai, it is also difficult for them to seek for the suitable cooperation partners if they will only take part in the exhibition and not do some efficient preparation.

The preparation for the Italian wineries is not adequate.

In my opinion, the foreign wineries who want to enter Chinese wine market should follow the three steps:
1. Command the market data and know the whole situation
2. Make good plan and take efficient measure.
3. Choose the wine agents in earnest and support them

In recent years, many foreign wineries entered Chinese wine market, but few of them can find the suitable agents and some of them even wanted to exit of the Chinese wine market. Why? The reasons of it are they didn’t know the complication of the Chinese wine market and didn’t take the efficient measures. So, they wasted time and money.

The most famous Italian business man in China is Marco Polo who was born in Venice. 700 years ago he came to China to do business. He lived in China for about 20 years and succeeded in business and politics. In my opinion, the reasons for him can succeed are he knew China well and knew what the products the Italy can supply to China. In the Chinese old saying is: Know yourself and others, the military is invincible

So, knowing the Chinese wine market is the first thing for you to do. There are tow points for you to know the Chinese wine market. Firstly, you can get the information of Chinese wine market through the authority Medias and the professional wine market consulting organizations, such as www.wines-info.com/en. You can also do the research in China and obtain the suggestion and analysis of the wine export. Secondly, you should make sure whether your wine is suitable to enter Chinese wine market. Not all the foreign can enter Chinese wine market, especially those of low production, quality and cost performance. So, before the wine entered China, the judgment of wine should be done. This work can be done by the tasting judge who know Chinese wine market well and the Chinese professional wine market consulting company.

Next, you should make a plan of how to enter the Chinese market and the project for business recruiting. Before you do those things, you need to think over the suggestion and opinion of the wine export and the Chinese imported wine agents. You must prepare sufficiently, and don’t in blind. Many foreign wineries just see the large potential of the Chinese wine market, with no preparation. With the wrong idea that the Chinese market is like Singapore, Japan, Korea and Tanwan, they don’t take seriously to choose the suitable products to enter China, set down the rational price and the efficient market promotion. At the last, hey got nothing but failed. So, I suggest that entering China should be calm and sane.

The last thing is to seek for the suitable cooperation partners in China. That is the most important task. To choose the professional imported wine agent who has the strength to import and sell wine in China is a complicated work. In order to choose the right agent, you should enlarge your communication. After you confirm the cooperation partner, you must do your best to support the Chinese agents to do the market promotion. You can’t only wait for the orders and consignment.  Whether the cooperation smooth or not is the key for the foreign product to succeed. The high quality of the imported wine is the key for it to own a steady customer group in China. The low price channel is not the long strategic for the market. The foreign wine companies who want the enter China must harmonize with the Chinese culture, marketing strategic, market promotion and regional cooperation. That is the necessary steps for you to enter China.

In one word, doing well in the three steps above and plus the high quality, suitable price and favorable brand of the wine are the necessary things for you to succeed.