There is speculation about Castel’s management style given the turmoil says Julian Hunt
What’s going on at Oddbins? Or should that be: what’s going wrong? An odd question, given that the drinks specialist should be celebrating after its victory in the International Wine Challenge where it reclaimed its crown as the best high street chain. But news of its success coincided with revelations that some of Oddbins’ most senior head office staff had quit the business, prompting talk that the chain was in crisis.
We’ve been here before. In fact, ever since Oddbins was acquired from Seagram by French wine group Castel a couple of years ago for £57m, the drinks specialist has been a constant target for criticism, not least from the wine luvvies who argue things are not the same as in the good old days.
“Castel is not as indulgent as Seagram used to be,” wrote top wine critic Tim Atkin recently in our sister paper OLN. “It wants a route to market and Oddbins provides that. If the reputation of what is still the best chain in the high street goes down the drain then I suspect that Castel won’t worry too much as long as it’s shifting lots of cheap claret.”
Plus ça change? Well, this time it’s not just the likes of Atkin who are wondering what is happening at Oddbins. The departure of top buyers Grant Ramage and Tony Allen in quick succession has fuelled speculation within the trade about Castel’s management style, its focus on cost-cutting and whether buyers really do lack the freedom they desire.
That’s all been strongly denied by Oddbins, which says its owner is totally committed to a business in which it is investing heavily.
MD Jacques Duley says: “Castel’s investment in the stores, staff and in marketing and in recruitment has been a major step forward for the business.”
But flick through Oddbins’ most recent annual report, filed at Companies House, and you can see that it, like rival drinks chains, is finding life pretty tough on the high street. Turnover was down almost 13% in the 12 months to the end of December 2003 at £136m, partly it says because of aggressive discounting by rival chains and supermarkets.
Pre-tax losses were the same as the year before at £600,000 - although it blames that largely on a £1m foreign exchange loss. On a brighter note, gross profit was up five points at almost 32%.
The report says: “The directors will focus on developing sales to restore Oddbins as the number one wine specialist in the UK.”
Winning the top gong in the IWC should have been a big step towards achieving that ambition. Only time will tell if it was.
What’s going on at Oddbins? Or should that be: what’s going wrong? An odd question, given that the drinks specialist should be celebrating after its victory in the International Wine Challenge where it reclaimed its crown as the best high street chain. But news of its success coincided with revelations that some of Oddbins’ most senior head office staff had quit the business, prompting talk that the chain was in crisis.
We’ve been here before. In fact, ever since Oddbins was acquired from Seagram by French wine group Castel a couple of years ago for £57m, the drinks specialist has been a constant target for criticism, not least from the wine luvvies who argue things are not the same as in the good old days.
“Castel is not as indulgent as Seagram used to be,” wrote top wine critic Tim Atkin recently in our sister paper OLN. “It wants a route to market and Oddbins provides that. If the reputation of what is still the best chain in the high street goes down the drain then I suspect that Castel won’t worry too much as long as it’s shifting lots of cheap claret.”
Plus ça change? Well, this time it’s not just the likes of Atkin who are wondering what is happening at Oddbins. The departure of top buyers Grant Ramage and Tony Allen in quick succession has fuelled speculation within the trade about Castel’s management style, its focus on cost-cutting and whether buyers really do lack the freedom they desire.
That’s all been strongly denied by Oddbins, which says its owner is totally committed to a business in which it is investing heavily.
MD Jacques Duley says: “Castel’s investment in the stores, staff and in marketing and in recruitment has been a major step forward for the business.”
But flick through Oddbins’ most recent annual report, filed at Companies House, and you can see that it, like rival drinks chains, is finding life pretty tough on the high street. Turnover was down almost 13% in the 12 months to the end of December 2003 at £136m, partly it says because of aggressive discounting by rival chains and supermarkets.
Pre-tax losses were the same as the year before at £600,000 - although it blames that largely on a £1m foreign exchange loss. On a brighter note, gross profit was up five points at almost 32%.
The report says: “The directors will focus on developing sales to restore Oddbins as the number one wine specialist in the UK.”
Winning the top gong in the IWC should have been a big step towards achieving that ambition. Only time will tell if it was.
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