Question

1. How does the Bordeaux wine distribution system work? Who benefits and how?

2. How is price set? Trace the process from the sale of the first tranche to the sale of a bottle in a wine store for $1,200. Why is the process so complicated?

Answer 1

Chateau Margaux ( Since I studied this case study answering the question )

1. How does the Bordeaux wine distribution system work? Who benefits and how?

There are 400 hundred merchants, get the data about the surface, volume and harvest in Bordeaux who taste the wine first. Then they give the data the biggest purchasers.

Then they get the primeur less expensive, and house Margaux can request higher process on the packaged markets, which the merchants acknowledge, to get the primeur cost for the following year. The merchants apportioned wine to their purchasers. This makes wine accessible to their clients.

This system benefits everyone. For the wine industry, it's acceptable on the grounds that they get the installment prior and they don't need to stress over distribution. With respect to merchants, they are also paid early. Clients advantage since they get a high amount.

2. How is price set? Trace the process from the sale of the first tranche to the sale of a bottle in a wine store for $1,200. Why is the process so complicated?

By the en primeur framework distribution is done. It implies that Chateau Margaux sells its wine in barrel and no in the wake of packaging when the wine is ahead of time about the significant vintage. Along these lines of distribution is utilized by a large portion of the chateaux and winemakers since they sell just somewhere in the range of 5 and 10% of their wine in the wake of packaging. The en primeur framework is described by the various advance that Chateaux and dealers regard so as to fix the last price.

This framework is confounded in view of the number of center men who are included in the exchange and how each takes a commission, Because Chateau Margaux needs to focus on delivering the wine they have numerous moderators who are there to offer the wine to the universal demographic.

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