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“We will perform the most important actions in Mexico, United States, and Canada”

August 5, 2014 by Claudia Ortiz | in News, Opinions

Eng. Gustavo Arizu, Luigi Bosca’s Research and Development Director for new businesses, mentioned some of the actions the winery will carry out in the coming months. Exports, markets, investments, wine industry context, are some of the topics he talked about in this interview.

How will the winery work during the second half of this year?

We are focused on two large countries: Brazil and United States. As regards Europe, we already know that it is difficult to compete there, as it has its own production. China is still establishing in the consumption, so it is difficult to settle volumes of growth, therefore, United States and Canada will remain really strong. Considering the panorama, we will perform the most important actions in Mexico, United States, and Canada.

How do you think the economic situation of some countries will affect Argentina’s exports?

In general, Latin America is going through a good process but with no impact in wine consumption. In the case of Peru and Colombia, they are also doing well economically, but not affecting wine consumption since these markets have a really higher consumption of beer and spirits.

So, in your opinion, what is the best way to move forward?

The domestic market should be strengthened, so as not to lose grounds to other brands. Moreover, it is important to consolidate in those booming markets. I think it is possible to work again but harder in the English market, as Argentine wines are well received there.

In the case of Europe, it will remain vegetating. China has a different consumption. In this country, there is no competitiveness because it has already 450 thousand hectares grown with grape, intended for its low consumption. In relation to BRICS, I personally see Russia as an interesting country, with a strong capital (it is also making investments in Argentina). However, it does not rely on a critical mass of consumers in restaurant yet, but I think it will be a long-term market.

In my opinion, we should focus on the market we are already present and well positioned. We will work very hard on American markets within a very competitive segment, U$S 18 – U$S 20 (retail price), where Luigi Bosca is doing well, with Finca La Linda, between U$S 12 and U$S 15, as a support brand. Special wines will be indented for those eager to know more about Argentina. We will have to work on lines over U$S 20, so as to educate consumers and show them what is being done in Argentina.

How will you develop the domestic market?

In the domestic market, the brand is well established and we have to be careful with rise in prices, in order not to affect consumption. Luigi Bosca line is reaching its limit; if we make readjustment in prices, its sales could go down. So, we are looking for synergies with some restaurants to keep a good dynamics between price-food-wine in such a way that consumers keep choosing it.

Will the winery invest this year?

We are planning to acquire a new estate because we have noticed that producers are losing profitability, so they will stop investing in vineyards. A percentage of the production we buy for Finca La Linda line will be greatly affected, having a huge impact on our quality. For this reason, we have decided to invest in this respect, so as to keep our quality in these segments.

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