Brexit adds £1.50 to the price of a bottle of European wine, says major retailer
A major wine wholesaler calculated that Brexit added on average more than £1.50 to the cost of each bottle of European wine it sold to consumers.
The warning comes as the UK faces a cost of living crisis, with inflation at 9% and expected to top 10% by the end of the year.
Daniel Lambert, whose South Wales company was named Small Agent of the Year by the International Wine Challenge in 2019, said Brexit had caused “huge disruption” to his business since the Kingdom United left the EU at the start of 2021.
Some 18 months after the move to post-Brexit deals under Boris Johnson’s Trade and Cooperation Agreement (TCA), Mr Lambert said it was now possible to establish a true financial picture of the impact of change.
A long-time critic of EU withdrawal, he said it was clear that the extra paperwork and delays created by Brexit had imposed a permanent increase in the cost of doing business, while bringing no benefit to his business .
Writing on Twitter, Mr Lambert said the average cost of importing wine from major European producers like France, Italy, Spain and Germany was £170-190 for a pallet of wine.
Ordering, collecting and delivering a pallet, containing an average of 672 bottles, typically took seven to 10 days from any part of the EU, accounting for two-thirds of the wine drunk in the UK .
Post-Brexit, he said delays between ordering and delivery of shipments extended to 21 days from Spain, 26 days from France, 35 from Germany or Austria and 45-70 from Italy.
The best rates his company could find for imports are £270 for a single pallet from Spain, £280 from France, £310 from Germany and £340 from Austria or Italy.
Brokers’ fees for new documents on either side of the Channel can add £25-£150 to each import and export document, Mr Lambert said, although he said he was able to save on average £65 on each mailing by doing some of the forms himself.
The overall additional cost of logistics and paperwork made importing a single pallet of wine from Spain £155 more expensive than pre-Brexit, £165 more from France, £180 from Italy and £150 from Germany or Austria, he calculated – the equivalent of 25p on each bottle.
On top of that there’s the cost of an extra member of staff hired just to deal with Brexit-related paperwork, which adds another 13p to the cost of each bottle, he said.
The new unreliability of delivery times has forced Mr Lambert to increase the stock he holds to ensure he does not run out of particular products, adding around 20p more to the average cost of a bottle.
‘So our costs have gone up without any benefit to anyone of 58p a bottle,’ Mr Lambert said. “Once the markups are applied to the usual wholesaler and retailer percentages, that 58p becomes over £1.50 a bottle with no benefit to anyone, and you the consumer are paying that.”
Disrupted supply chains in the wake of the Covid pandemic have dramatically increased the times and costs of shipping New World wines from producers like Australia, giving EU bottles an even firmer hold. in the UK market, he said.
“My conclusion is very simple,” he said. “No matter how many free trade deals the UK has, the one with our closest neighbors is the most important.
“You can’t argue against geography, and the Global Covid restart makes that clear. We live in a just-in-time world, Brexit is the exact opposite.
“Furthermore, in a world where we need to use less energy and reduce CO2 emissions, buying locally matters more than ever. So the obvious answer is stronger relationships with your closest neighbors. Simple as that in my opinion.