The price of wine

Personal and family finances are an important factor in the decision-making process when it comes to buying a wine. In his book El Vino, André Dominé states that “In principle, more and more people can afford the luxury of buying an exquisite wine and discovering what lies behind its quality and character.” This author also states that times have changed in the world and that before wine was only available to the wealthiest classes, today wine has begun a process of democratization . The question is whether this is also happening in Mexico.

What is the price-quality ratio?

The price of wine does not necessarily go hand in hand with quality. A wine is more expensive if it has been carefully made and with better quality grapes. Taste is subjective, quality is objective. However, when buying it is important to keep in mind that you do not necessarily have to spend a fortune to acquire a good wine. According to Karen McNeil , author of The Wine Bible and a professor at the Napa Campus of the Culinary Institute of America, says that if you're going to a dinner party with friends and there's going to be lasagna, a $60 wine is not only unnecessary but out of place. People who aren't knowledgeable about wine are generally guided by price, believing that the more expensive the better... Wine connoisseurs make their choice based on the price-quality ratio of what's in the bottle.

In relation to price and quality, the increase in wine consumption in Mexico is supported by the middle and upper classes. The Spanish commercial office in Mexico, in a research report, published that especially young adults with purchasing power, being the social class that most dares to try new drinks and varieties... want to incorporate new alcoholic products and perceive wine as the most versatile option.

The price and type of wine

The market in Mexico is increasingly looking for better wines, that is, those that wineries consider their high-end. Although most of the sales of red wine that have been registered in recent years have been concentrated in bottles whose price is between 91 and 150 Mexican pesos, a more informed consumer behavior is observed, who can pay more but look for a higher quality wine.

White wines are the exception to the last point, as 49% of the litres sold were priced below 90 pesos. On the other hand, in the category of other sparkling wines, the bottles priced at less than 166 pesos are the ones that have seen the biggest increase in sales.

These data lead us to consider that the most sought-after and purchased wine is red wine. White and sparkling wines have a specific niche of consumers who seek them out and prefer them. The categories of rosé wine and fortified or fortified wine still have an important challenge in positioning themselves in the Mexican market.

Taxes on wine

In relation to price, it is vital to consider indirect costs and taxes such as the Special Tax on Products and Services (IEPS), which together with VAT add up to a little more than 40% of the retail price. The indirect costs absorbed by the consumer of imported wines are those of transport, payment of taxes and customs procedures, as well as labelling and storage. Wine importers state that obtaining labels is slow, which delays importing, sometimes making it necessary to resort to fiscal storage, situations that increase the costs of wine.

In recent decades, the tastes of Mexican consumers have changed and are now more demanding.

There is a direct relationship between consumption patterns and distribution, resulting in a variety of prices depending on the place of purchase. In general, lower-priced wines are concentrated in supermarkets and discount stores, while high-end wines can be found in specialty stores and in restaurants, hotels, bars and other consumption centers. In general terms, it could be said that a wine consumer who orders a bottle in a restaurant is willing to pay the price offered.

Sommelier Jose Luis Umana Saldana