Haven’t bought from Zachys for a while. Got my invoice, where in addition to the 25% vig, there were two additional charges of 2% each. One for the cc, which other auction houses do, although retailers do not, and another a “service” charge which brings total commission to 29% if you pay by card. Auctio houses and retail are similar, possibly because the mark ups seem about the same.
Sotheby’s have reduced the initial vig to 20%, although I am not sure if there are ancillary charges. Hopefully others will follow, so that people will feel that auctions again are a good option.
If you look at one of my posts above, I specify that I think the issue is the direct sales through KLWM.
They are dealing with rare wines, and aren’t pacifying the market demand. I think that is the biggest root of the issues for the wines in the wholesale channel, and why the supply becomes what it is. I assume all sides know what KLWM is doing with the wines, but if Aldo Sohm can’t get Coche and Raveneau for Le Bernardin (not sure if they are or aren’t, but just using that as a potential example), then something’s really broken.
Oh, I have no pardon or mercy for what is clearly gougeriffic behavior.
To my personal vision, I judge it as dirty bird self serving to an egregious and shameful extreme.
I guess that I was trying to create a distinction between contemporary (well, for a while now) business practices of the company and the man himself.
I visited one of Kermit’s producers. About 60% of their entire production went to him. He once told them they needed to change their label, and they did it without batting an eye. I got the feeling that if KLWM said “jump,” the producer would say “how high?”
Early in my importing days I had a fine producer I represented call me and say he wouldn’t be able to sell to me anymore because he had also been selling to “this guy named Kermit*” who now wanted into the state where I was selling and “he buys a lot of wine.” The fact that Kermit moves a lot of wine will come to no surprise to anyone here. Over the years, like most everyone else, I would lose suppliers to other importers more established and bigger than I was who also ended up charging considerably more than me. What I came to realize is that at the end of the day, very few really care about what happens with their wine after it leaves the cellar. They want all the things that come with names like Kermit such as distribution to top accounts, volume with one stop shopping (not having to deal with multiple vendors) and being paid on time. Doesn’t matter what the vendor’s margin is.
*I spoke with Kermit about it and he already had a national exclusive, he just hadn’t found a home for that supplier in my state until then. He was very cool about it and very kind.
Well aware of the volumes they can move. I just find it interesting I can get “allocated” one case of Tempier Rose, but I can buy all that I want from brokers all over Europe.
I didn’t know they allocated it that hard. Could be a rose strategy. I’m sure you’re aware rose tends to be a nightmare for importers. They either bring in too much or not enough. Although Tempier/Bandol is an exception, no one wants last year’s rose. If one can create the perception of limited availability and not worry about having to warehouse it for even a single month that could make sense even if it’s at the expense of additional sales.
