**London**: Brett Fleming, Managing Director of Armit Wines, expresses concern over consolidation in the UK wine industry, citing unprecedented challenges such as rising costs and taxation. Despite the hurdles, he emphasises the importance of adaptation and collaborative partnerships to ensure resilience and future growth for the company.
Brett Fleming, the Managing Director of Armit Wines, has voiced concerns about the potential for consolidation in the UK wine industry, labelling the current business climate as the most difficult he has experienced in over 35 years in the sector. Speaking to The Drinks Business during a recent portfolio tasting, Fleming expressed uncertainty about the future, stating, “I am an optimist, I always have been and I think the glass is always half full, but there’s no question where the headwinds that we’re facing are unprecedented. It is like nothing I’ve ever seen in my career.”
Fleming highlighted several challenges facing the industry, including escalating operational costs, taxation, and the complex regulatory environment created by Extended Producer Responsibility (EPR). He stated, “How many more hits do we need to take? And I think, sadly, companies will fall under” due to these pressures. Despite Armit Wines managing to remain profitable amid these challenges, Fleming acknowledged that the company’s performance in the current year would not meet his expectations, attributing 90% of this shortfall to the harsh market realities.
He mentioned that the industry has reached what he termed “peak taxation,” critiquing the government’s failure to engage with the realities faced by wine businesses. Fleming argued that the notion that recent duty changes would create a fairer tax system is misleading. He pointed out that adapting to these changes has required considerable effort on their part, such as hiring additional staff to modify operating systems to comply with fluctuating duty rates, which change annually based on variations in alcohol content.
Despite these adversities, Fleming underlined the company’s commitment to adaptation and growth by focusing on onboarding new customers and leveraging their diversified portfolio. He noted the importance of identifying “the bright lights in our portfolio that bring customers into it” in order to ensure that the full range of Armit’s offerings is effectively presented to customers over time.
Fleming also placed significant emphasis on the value of establishing collaborative partnerships with customers as a strategy for navigating the industry’s complexities. He expressed a desire for Armit to transcend a transactional business model, instead fostering genuine partnerships that enhance the relationships between growers and their vineyards, which in turn could improve the representation of those wines through Armit. “Fundamentally, I believe the way we as a company will cope is to build genuine collaborative partnerships with our customer base,” he stated, stressing the importance of developing long-term commercial plans that resonate with customer needs beyond immediate demands.
In conclusion, while the UK wine industry currently faces formidable challenges that may lead to consolidation, Brett Fleming’s outlook remains focused on proactive adaptation and the building of enduring partnerships as a means of ensuring Armit Wines’ resilience in a shifting landscape.
Source: Noah Wire Services
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