Australian wine producer Brown Brothers is to pull its namesake brand out of the UK, describing it as ‘the most unforgiving market in the world’ and ‘unsustainable for our company’.
Family-owned Brown Brothers cited a number of factors for the decision to withdraw its eponymous brand, including Brexit-related uncertainty, unfavourable exchange rates, shifting consumer trends, increased operating costs and the high level of competition.
Brown Brothers has operated in the UK for more than 25 years, during which it has experienced ‘some wonderful periods of sales momentum’, particularly through its focus on unusual grape varieties.
‘This has been an extremely challenging decision as many years of exhaustive effort have gone into the UK market, particularly from the Brown family and its in-market employees,’ said Dean Carroll, CEO of Brown Brothers, which is a member of Australai’s ‘First Families of Wine’.
Carroll added, ‘But our belief is that the UK is now the most unforgiving market in the world, and the opportunities for us elsewhere are exciting and far more appealing, [and] therefore must be pursued enthusiastically.’
Brown Brothers will continue to operate in Europe ‘under a tighter focus’, Carroll added, while the company’s Innocent Bystander and Tasmanian wine brands will still be sold in the UK.
Steve Moody, managing director of John E Fells & Sons, Brown Brothers’ UK importer, said the decision ‘reflects the fast-changing and very challenging conditions that this market faces’.
Fierce competition, powerful retailers and high levels of excise duty have long made the UK a tough market for wine companies, but this has been exacerbated by the uncertainty caused by the Brexit vote and the falling value of the pound.
Last week, beleaguered drinks business Conviviality – owner of the Wine Rack and Bargain Booze retail chains, plus drinks suppliers Matthew Clark and Bibendum – announced that it intended to appoint administrators within 10 business days after failing to raise £125m to keep it afloat.