I just got offered 750 mL bottles of Krug from a West Coast outlet for $105 a bottle all in delivered to me when it cools down. That seems to be about the lowest in the nation factoring in shipping and taxes on a per bottle basis. Why is then, that online prices touch $200 a bottle and locally they are actually $250 a bottle? Is this distributor driven? Market? What? I find it hard to buy into the fact that because I am in Dallas vs. a coastal metropolis, that the wine has a 250% premium.
Hey Bill,
It is a distributor that is slashing the prices. I commented about this in the BV Tapestry 06 thread too. When I was in MD, Krug was $170 or so wholesale, but they did a promotion for a few months that was $100.
So, if someone bought high, they would have to sell it for $250, but if they got in on the special price, they could sell it for much less depending on what kind of margin they wanted.
Diageo does this sort of thing time to time which can cause wild price variances, like the Krug, or BV Tapestry for $25 to $50.
Luckily for me, a store had bought too much and needed to unload some quick for cold hard cash. I picked some up for $50 each!
They also did a 96 vintage/Grande Cuvee bundle. So, depending how the retailer allocated the costs between the two that also caused some pricing discrepancies even when retailers paid the same price.
Maybe it speaks about the state of Champagne sales?
Around 2003 or so, Krug was widely available in MD for 100 retail. For the past few years, wholesale has been 150 and up. Thats a huge price increase (as we are seeing all over the place)
So, my assumption is that the wine doesn’t sell as well at $250 retail (lots more competition) than it did at $100 retail.
However, they don’t want to lower their prices!
So they do little promotions every once in a while (probably coinciding with end of fiscal year) to blow out wine. And when Diageo wants to blow out a wine, they price it pretty aggressively.
Not great for the consumer to see such wide swings. But Krug at $105 in todays market is a very good price!
Ray, interesting that you mention that bundle. Same outlet was offering the '96 Vintage Krug at $275 a bottle months back, which I thought was the median price at the time.
Bill, I cannot give you a complete answer but it is worth noting that most major Texas wine retailers I deal with take their smallest margins on champagne. The usual markup is less than half the standard for wines over $10-15. That said, $100ish for Krug MV is very low and surely a dump in any market. Happened in Texas last year when I loaded up on splits at $38 each. There have been frequent enough deals on Krug MV the last 2-3 years that I just wait and stock in advance as needed when prices go below $125 per 750. I expect resistance to a permanent correction to that level and so just load up when the dumps happen that facilitate an overall push to keep the market price around $175.
The avg current NY wholesale would put a ‘regular’ price of $175-200 on the Krug MV. Half bottles were insanely cheap for a long time here as well, they sold a ton to restaurants and many featured them at $99 on their lists.
In states where it is legal, (not NY ) there is also lots of ‘dealing’ going on, ie if you buy 3, 5, or 10cs you get a free cs or two or three, and averaging your cost down gives you lots of room to slide your price around, though it is still illegal to sell below the ‘listed’ lowest wholesale cost in many states.
Buying Krug Grande Cuvee comes down to two things: who you are dealing with and what time of year it is. For the past few years, Krug has been trying to push the Grande Cuvee up to the $175 mark, but it just doesn’t sell at that point. So… to make up for it, big buyers often get better deals and when inventory gets high or sales goals need to be hit, the price drops all over. I bought 750s last year at the lowest price I have seen in a long time (a good deal below $100). Since January, it has slowly moved back towards $175 full retail and I think it will eventually move back towards the $100 retail mark and possibly under in some areas. Still, Krug is committed to eventually pricing Grande Cuvee above the non-Rose tete de cuvees from the other LVMH houses (Dom Ruinart BdB, Dom Perignon, Grande Dame)
As to the Krug Grande Cuvee/1996 mixed packs (4 Grand Cuvee/2 1996), the folks in my area were encouraged to retail price the Grande Cuvee at or above $175 which meant the 1996 retailed for about $210 or a little lower. It was all about establishing a base for the Grande Cuvee and if you had a friendly retailer who let you cherry pick the 96s, you could get some nice deals on the 1996. Of course, in my area, at the same time, if you wanted a straight 6 pack of the 1996, you had to pay over $400 a bottle.
![[head-bang.gif]](/uploads/db3686/original/2X/b/b1cd199e4b2b2988b5107c3c9598fd28dc92a776.gif "[head-bang.gif]"){kind=small}
) there is also lots of ‘dealing’ going on, ie if you buy 3, 5, or 10cs you get a free cs or two or three, and averaging your cost down gives you lots of room to slide your price around, though it is still illegal to sell below the ‘listed’ lowest wholesale cost in many states.