Wine-lovers sniff opportunity online
The lockdown has seen wine lovers rush online, says Chris Carter.
It has never been easier to buy fine wine without ever seeing it, let alone tasting it. And with most of us stuck at home, there has rarely been so much time in which to do it. It’s little wonder, then, that so many wine enthusiasts and collectors are turning to the internet in order to carry on indulging in their hobby.
That has been the experience of family-owned business Octavian (octavian.co.uk). Its vast wine cellar in Corsham, Wiltshire, has seen a keen uptake of its new MyCellar wine portal, launched last week, with a quarter of its customers logging on in the first few days. Around 250 items were for sale over that period, worth a collective £250,000.
Wine tastings by Zoom
“We know that many people have a little more time on their hands right now and may be interested in enjoying their wine collection,” says Vincent O’Brien, Octavian’s managing director. The new portal allows collectors to access information on the wines, share tasting notes and even track the value of their vinous investments. “Virtual wine tastings via platforms such as Zoom are having their moment and we are confident that the MyCellar portal’s more socially-orientated features will help raise spirits as collectors record their drinking experiences and share tasting notes,” says O’Brien.
Octavian’s cellars are huge, covering an area roughly equivalent to 11 football pitches. It needed to be big. The cellars, a former mine, served as munitions storage in World War II. For 30 years, it has stored fine wines in a carefully controlled environment so that they don’t deteriorate under light and heat, for example.
Liv-ex (liv-ex.com), a business founded in London by two stockbrokers in 2000, has offered an online “global marketplace for the wine trade” for a while. And its spin-off, Cellar Watch (cellar-watch.com), offers users a real-time view on the wine trade, as well as the ability to access information and track prices. So what is Octavian bringing to the party that’s new?
One of the most exciting features of Octavian’s new online portal is the “Exchange”. “The main differences [with Liv-ex] are that customers are able to trade directly with one another, not having to physically move assets from Octavian’s storage conditions and secure custody,” Octavian tells MoneyWeek. “Octavian is also the only one that shares the storage history with the buyer, giving more information on the wine and a higher level of authority.”
So, while “Liv-ex membership is for wine professionals only”, as Liv-ex states on its website (although anyone can pay to access its data and analysis), Octavian allows collectors and wine enthusiasts to buy and sell to each other – and “that may include some retail investors”.
It can make good tax sense to invest in wine. You can buy and sell your wine “in bond” through Octavian, meaning you avoid paying VAT and duty (if you succumb to your urge and later decide to drink it, those taxes will have to be paid). Not everybody brings wine onto the Exchange that is “in bond”, but “the majority of people do”, says Octavian. It’s something to be aware of as you trade from your sofa.