(Find some more news on www.vitabella.fr). In Singapore, the 11th edition of WSA (Wine & Spirits Asia) may deliver this week a positive message to luxury wine estates: The Lion City offers great opportunities for expensive wines.
In fact, when the subject comes to Asia and luxury wines, some estate owners only think about China and Hong Kong. Asia has other interesting markets for expensive wines including South Korea and Singapore. Wine drinkers in Singapore are definitely getting increasingly sophisticated, and wine consumption is going up. People in Singapore have a mature palette in general and wine lovers have been collecting wine for over a decade. The importance people place on wines is increasing and it is not rare to find wine cellars in their home. And Singapore's expatriate population (about 150,000 Westerners) is just a contributing factor for growth in this market. Studies show that Singaporean wine consumers are mainly in the middle to upper income bracket and that they tend to be mostly Chinese, aged between 25 to 50 years old. Add to this, 10 million tourists a year, wine cellars, boutiques and duty free shops at Changi Airport, and estate owners may understand the great opportunities of this market for luxury wines.
With Hong Kong's tax being zero, will Singapore lose the game to be a luxury wines' hub in Asia in the future? Competition is strong and China is a hugely attractive market. But Singapore's central location, high degree of organisation and convenience still make the country an important re-export centre regionally. In fact, year after year, Singapore continues to develop its re-export business of luxury wines with Malaysia (where the Chinese population forms the wealthiest group of consumers), Indonesia and Thailand (markets mainly constituted by expatriate business people and tourists) or Vietnam (where the overall wine consumption is still very small). In the Lion City, the current tax system does not make a huge impact on luxury wines (tax stands at US$48.2 per 100 bottles, multiplied by the alcohol percentage, with on top of this a regular 7% Goods and Services Tax). With this system, the most expensive wines are much less impacted than cheap wines and the result has been that many visitors from around the region fly to Singapore to pick up premium wines. Some businesses in Southeast Asian countries also prefer to get their wines stored in Singapore and have small quantities re-exported from time to time. A Thai importer, for example, who will have to pay a 400% tax if he imports directly from France, will prefer to import from Singapore and pay a fraction of this. So Singapore's strength in logistics is key to develop further opportunities with these countries. Singapore shows a fine infrastructure, with bonded temperature controlled warehouses just next to the docks. This means that the precious wine doesn't sit on the docks in the heat for hours but is safely stored at optimum temperature in a warehouse. And this last point becomes a real advantage for wine merchants when you consider the current prices of luxury wines in the international markets...(Find some more news on www.vitabella.fr).
With Hong Kong's tax being zero, will Singapore lose the game to be a luxury wines' hub in Asia in the future? Competition is strong and China is a hugely attractive market. But Singapore's central location, high degree of organisation and convenience still make the country an important re-export centre regionally. In fact, year after year, Singapore continues to develop its re-export business of luxury wines with Malaysia (where the Chinese population forms the wealthiest group of consumers), Indonesia and Thailand (markets mainly constituted by expatriate business people and tourists) or Vietnam (where the overall wine consumption is still very small). In the Lion City, the current tax system does not make a huge impact on luxury wines (tax stands at US$48.2 per 100 bottles, multiplied by the alcohol percentage, with on top of this a regular 7% Goods and Services Tax). With this system, the most expensive wines are much less impacted than cheap wines and the result has been that many visitors from around the region fly to Singapore to pick up premium wines. Some businesses in Southeast Asian countries also prefer to get their wines stored in Singapore and have small quantities re-exported from time to time. A Thai importer, for example, who will have to pay a 400% tax if he imports directly from France, will prefer to import from Singapore and pay a fraction of this. So Singapore's strength in logistics is key to develop further opportunities with these countries. Singapore shows a fine infrastructure, with bonded temperature controlled warehouses just next to the docks. This means that the precious wine doesn't sit on the docks in the heat for hours but is safely stored at optimum temperature in a warehouse. And this last point becomes a real advantage for wine merchants when you consider the current prices of luxury wines in the international markets...(Find some more news on www.vitabella.fr).
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