In high spirits


Goa’s wine and liquor retail market seems to be flourishing, with sales having increased by 10 – 12 per cent during the last financial year
By Michael Fisher | B&C
The Goan beverage industry is a major contributor to the economy generating over Rs 800 crore to Rs 1,000 crore and responsible for keeping one lakh dependence contented, inform distillers and retailers.
Known on the global platform for launching wines and alcohol brands, Goa is noticing new marketing strategies by promoters from outside the states. Instead of press and media promotion, promoters are selecting popular resorts on the beach front and offer free of cost the newly-introduced wine or liquor brands to two or three couples inviting them to a round table chat. They continue this excise at other resorts and at a 5-star hotel.
Tito’s Goa’s happening place is the owner of Titos’ Sparkling wine distilled in Nasik for Tito by Good Drop Wine, the makers of Rio Fizzy Wine. Plans are in place to export Tito’s Sparkling Wine to Dubai and UK, says wine maker Ashwin Rodrigues.
The ban on mining is termed the conundrum of Goa’s struggling economy and its rippling effect continues to impact on all sectors, but the wine and liquor industry bucks the trend and is a saving grace for over one lakh dependence in this industry, opines Victor Fernandes of Margao Cintubro.
Wine is drunk as a health drink during meals and it is considered a serious drink, says importer and distributor and proprietor of Liquid Gold, Vivek G Kerkar, quoting Jim Murray’s Whisky Bible. Goa is importing about 24,000 cases of foreign wines and 49,000 cases of foreign whiskies. The consumption of imported foreign liquor is increasing at 15 per cent. The VAT varies. Johnnie Walker King George V costs Rs 49,000, with the VAT being Rs 8,900. Single malt whiskies such as John Paul that is distilled in Goa and Bangalore based Amrut are doing well in the export market.
The sales of wine and liquor in Goa have increased by 10 per cent to 12 per cent, according to figures procured from the excise department. For the financial year ending March-April 2013-14, Goa’s excise department has netted a revenue of Rs 235 crore against last year’s Rs 212.89 crore in 2012-13 in IMFL. Tentatively till June this year Rs 51.44 crore has been collected. This is only excise figures barring VAT and service tax. The vibrant wine and liquor retail market seems to be Goa’s ATM, boast retailers.
The Excise Department says sales of local wines in 2013-14 saw revenue collection up at Rs 5.70 crore against collection for 2012-13 of Rs 3.85 crore. In foreign wines, excise collection was Rs 1.89 crore in 2013-14 against Rs 1.91 crore in 2012-13, a slight drop.
Wine retailers in North and South Goa are anticipating a wine price crash, as the wine glut seems to have dried up and stocks are piling. Among the factors that are affecting the wine market is the production from new vineries set up in Maharashtra by Karnataka producers.
Slow consumption is not matching over supply to the market resulting in a temporarily closure of some vineries in Maharashtra, says Fernandes. Over the years, Maharashtra has been contributing 65 per cent to 70 per cent wine production to the Indian market and is now facing over production by new vineries. To defeat the high excise duties levied by the Maharashtra government on wines made in other states, Karnataka vineries have set up distilleries in Maharashtra and have started its production.
Some Goan wine retailers are shying away salesmen from Maharashtra on account of over stocking of wines. “But wines such as Sula, Frateli, Valonia and Banyan are good wines and its prices is expected to increase,” Goa Liquor Traders Association president Dattaprasad Naik informs.
He refutes that prices of wines will come down. But he does not deny that some unheard of wines brands are making its entry in Goa market. “The excess production we talk about,” he says, “is on account of the former Union Agriculture Minister Sharad Pawar who offered subsidies to entrepreneurs wishing to set up their vineries in Maharashtra.”
The subsidy offered for wine making was too generous and tempting and those who had the formula to make wines may have flooded the market with its attractive package bottles, says the association president. As Goa is a 365 days tourist destination, demand for wine will continue by the tourists.
The association has made a plea to Chief Minister Manohar Parrikar to allow wine retailers to retail in packed bottles and to allow retailers till 11 a.m. to meet the last minute buying by tourists. “I will address your issue by framing a new excise policy,” Dattaprasad quoted the CM. The extra two hours will increase at least 30 per cent sales for us and excise duty to the Government.
The Rs 3.25 lakh John Walker (not Johnnie Walker) will soon enter the Goa market. To quench enquires from Goa’s rich elite, Liquid Gold proprietor Vivek G Kerkar has decided to import this brand. When sold to the consumer, the government will earn Rs 58,000 as VAT plus the customary excise duty.
Goa produces 10 lakh cases (distilled plus bottled and packaged) of Indian Made Foreign liquor (IMFL) and yearly 42 lakh cases of various brands of beers, increasing at 10 to 12 per cent yearly. During the season, tourist consumption is around 45 per cent to 50 per cent. About 15 per cent is purchased by travelers leaving the state, and the balance is local and migrant consumption, he says.
Permit selling retailers say they sell to the rich elite very high-end brands priced ranging from Rs 50,000 to Rs 2.50 lakh a whisky bottles as they detour through Goa.
According to Dattaprasad there are about 1,763 retailers, out of which 10,000 families are involved in the retail business, and one lakh people are dependant. About 8,000 restaurants are not taken into account.
Rohan of Tom’s sells a bottle of Johnny Walker King George V a month. And regularly Lousi XIII a cognac costing Rs 2.5 lakh and stocks all the best collection of Johnnie Walker brands. Yearly he sells hundred cases of wines ranging from Rs 500 to Rs 5,000. Dry wines are consumed the sooner the bottle is opened, whereas sweet wines can be kept for a day or two.
Overall, Goan traders are doing well, getting a margin of 5 to 7 per cent on monthly volumes. On an average, each retailer issues 50 to 100 permits a day during the tourist season, it varies from city to villages. The Goa government earns 22 per cent on VAT which also varies.


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