Most popular wine in Korea cuts price
By Kwon Mee-yoo
Montes Alpha, the most popular wine in Korea, will see its retail price cut by 10 percent, it was announced Wednesday. More than 280,000 bottles of the Chilean wine were sold last year, topping wine sales records.
Its importer Nara Cellar said it will reduce the price of 15 Montes wines, including Montes Alpha, by about 10 percent. A bottle of Montes Alpha Cabernet Sauvignon was priced at around 44,000 won at retail stores and it is expected to go down to 40,000 won.
“We decided to cut the price as we now can sell wines directly to customers,” an official of Nara Cellar said.
The company said the markdown comes from simplified distribution stages due to a revision of the Liquor Tax Law. The government will lift bans on liquor importers selling wine directly to retail stores or customers from this month. A bottle of wine currently has to go through a Korean importer, a wholesale dealer and retailer before arriving at the hands of customers.
The price cut by the Montes line might affect the local wine industry. Some claim that local importers and wholesalers take too much of a margin and inflate the price of the wine which is originally below $10 on average.
According to the Korea Customs Service, the average import price of wine was below $10 — $4 for a bottle of red, $2.6 for white and $6.2 for sparkling wine. For the bottom 25 percent of relatively low quality wines, the average price per bottle was just $1.7.
An industry source said wine with an import cost of around $10 could be a premium bottle and the retail price is quite exaggerated misleading customers on expensive wines.
However, the importers countered that the Liquor Tax Law prevented them from selling directly, causing complicated circulation and price increases.
As the amendment of the law reduces at least a stage in the distribution process, customers expect price cuts for other wines, too.
Keumyang International, an importer of Chilean wine 1865 to Korea, said it is discussing price change and plans to announce details in the next week or so.