Some interesting Wine Soc stats

Tom Cannavan

Tom Cannavan

Administrator
A press release mainly about new systems put in place by the Wine Soc to 'future-proof' the business, also has some interesting stats:

In the financial year 2019/20, The Society despatched £250k of wine every day on average, while today they have the capacity to process £500-600k. Christmas 2020 saw 232,000 bottles being picked and packed in 15 days, compared to 90,000 in same time period the year before. The greater efficiencies have also resulted in the majority of name-the-day orders being delivered within two days.

Over one million parcels of wine were packed and delivered in the last financial year, around a 30% increase on 2019. Total invoiced sales were up by 28%. While people stayed at home, they signed up to The Wine Society in their droves: lapsed members started to order again, new members signed themselves up and active membership grew 17% to 171,000.
 
An average spend of over £500 per member annually is pretty impressive.

With a turnover of £100m plus maybe I should put my share in a safe place, retirement on sun-kissed beaches is looking up.
 
Wow. I'm sure there are members of this parish who run booze establishments that would love numbers like that.

I have to say, after rummaging around the more modest offerings from TWS how impressed I've been - it is rare that I come up against a duff wine.
 
It's fantastic to know that TWS appears to be in a very strong position. The figures are astonishing on the face of it: I expect a stand alone independent wine shop would be happy to sell £250k of wine per year, never mind per day.

The health of the Society is important for all wine lovers: a) it shows people can still discriminate and not all be suckered by 'introductory offers' by the more commercial membership businesses, b) it gives access to the UK market for wine producers who do not fit supermarket or indie merchant models, and c) it offers drinkers nationwide access to huge and really well chosen portfolio of wines at fair prices.

We might have legitimate reasons to grumble about them occasionally, but without them the UK wine scene would be much diminished.
 
I was going to start a similar thread Tom - I saw those numbers in the TWS’s summary and wondered If it was only me who hadn’t realised the sheer scale of their operation. My primary reflection on the numbers is what an amazing job they do in seeming human, friendly, approachable and helpful in the context of what is a really huge business. It shows that providing great service doesn’t have to be sacrificed for large volume sales.

It has also helped me contextualise the sorts of stuff we fret about on here - allocating a few hundred bottles of Burlotto for example - it must be take disproportionate effort to do anything that is perceived as fair.

I know absolutely nothing about accounting, so I’d be interested to hear from someone with more of a clue what the para I’ve posted below means in practice? I’m guessing it means that the benefits of the good trading year are being used for the benefit of members in some way?

Dividends, capital and reserves
For the first time in several years, the Committee resolved to declare a dividend for the year; the dividends have been appropriated to members’ Accumulated Profit and Sales Discount accounts. The overall shareholders’ funds of £41.4m (2019/20 £35.4m), leave The Society in good financial health.
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Andy Leslie said:
I was going to start a similar thread Tom - I saw those numbers in the TWS’s summary and wondered If it was only me who hadn’t realised the sheer scale of their operation. My primary reflection on the numbers is what an amazing job they do in seeming human, friendly, approachable and helpful in the context of what is a really huge business. It shows that providing great service doesn’t have to be sacrificed for large volume sales.

It has also helped me contextualise the sorts of stuff we fret about on here - allocating a few hundred bottles of Burlotto for example - it must be take disproportionate effort to do anything that is perceived as fair.

I know absolutely nothing about accounting, so I’d be interested to hear from someone with more of a clue what the para I’ve posted below means in practice? I’m guessing it means that the benefits of the good trading year are being used for the benefit of members in some way?
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Andy, I can't claim any accounting knowledge either, but the financial statements show an increase of ~£2.5m to the 'Sales Discount Account', which according to the Society's rules is an account into which a proportion of profits can be paid, and from which the Board may make discretionary payments to the membership, in proportion to the amount each member has spent during the period. If not paid out in that way the funds remain in the account until the dissolution of the Society. Presumably they are not planning to actually make a payment (surely there are better uses for the funds?), in which case it seems a slightly odd and not terribly useful way to use a windfall profit.
 
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Geoff Kuehne said:
Andy, I can't claim any accounting knowledge either, but the financial statements show an increase of ~£2.5m to the 'Sales Discount Account', which according to the Society's rules is an account into which a proportion of profits can be paid, and from which the Board may make discretionary payments to the membership, in proportion to the amount each member has spent during the period. If not paid out in that way the funds remain in the account until the dissolution of the Society. Presumably they are not planning to actually make a payment (surely there are better uses for the funds?), in which case it seems a slightly odd and not terribly useful way to use a windfall profit.
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If it hadn't been appropriated to sales discounts, which seemingly only get paid out on a member's death, declared retained earnings would be higher by the same amount, the surplus has to go somewhere - there's always pressure on "not for profit " entities to keep their retained earnings balance to a reasonable level or reduce them through additional expenditure/changes in pricing etc., so maybe this is just a way of beefing up the permanent reserves in a non-contentious way? 2020 was a pretty weird year due to covid and is almost certainly not indicative of permanent organic growth, so maybe this is a fairly sensible thing to do?
 
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