Monday, 2 April 2012

Chinese Liquor Brands Rise, All the Way to the Big Apple

by Mark J. Miller

You’ve heard of Louis Vuitton, Hermes, and BMW, but there are two high-end brands that you may not have heard of in the top 10 luxury brands worldwide as ranked in a new report by China's HuRun Research Institute.
Plenty of brands around the globe would pretty much do anything right now to be in the position these two Chinese homegrown (or baijiu) liquor brands, Moutai and Wuliangye, are in. HuRun has Moutai’s “brand value” at $12 billion while its counterpart’s value is pegged at $7 billion,according to Bloomberg Businessweek.
While there are still plenty of working-class folks spread across the world’s most-populated country, there are also plenty of wealthy Chinese who want to show off their good fortune. That’s why China has passed America as the world’s largest wine-auction market.
“Last year, a bottle of vintage Moutai, with an initial biding price of RMB 2.6 million, sold for RMB8.9 million (about $1.36 million) in the city of Guiyang,” BW notes. “In January, a bottle of Wuliangye brewed in the 1960s  sold at auction for RMB980,000($155,687).” 
The report points out that the liquors haven’t found much of a market out of the China yet, likely because “critics have compared (the taste) to gasoline.” Still, something’s value is only measured by how much someone will pay for something and folks are willing to shell out for these liquors. Got to keep up with the Joneses. Even if it means drinking something that tastes like gasoline.
Perhaps the taste is quickly forgotten after a few sips since both brands pack a serious punch, having 52 percent alcohol or more. What isn’t forgotten is how the companies have grown in the past year, a sign that the economy is continuing to get better. Kweichow Moutai “generated an estimated RMB16.8 billion (about $2.7 billion) in revenue in fiscal 2011, an annual increase of about 66.3 percent,” BW adds, while Wuliangye Yibin “reported RMB20.2 billion ($3.2 billion) in revenue in 2011” and it should grow 33.2 percent in 2012.
Want to try the stuff? If you’re in New York, midtown Manhattan’s S. Dynasty serves it up, but it’ll cost you $220 for a 375 ml. bottle of Moutai and $120 for one of Wuliangye. You have to pay to play, son.

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