Overview of performance
It has been an extremely difficult year for the retail sector with several big high-street names
disappearing or shutting large numbers of stores. Consumer demand is variable, high-street
stores carry with them a huge overhead cost and the competition from online retailers is intense.
The wine sector is not immune and only the week before writing this, it was announced that
Oddbins had been put into administration for the second time in eight years. We do know that
alcohol consumption per head is falling; slowly, but falling nonetheless. Delivery is a key battleground
with customer expectations going up all the time, though at a substantial cost to the retailer.
The challenges, therefore, are considerable.
Against this background, our financial performance remains reassuringly steady. Those aren't words
that you would normally read in an Annual Review. But with a focus on long-term trends not short-term targets, and the key measure of our success being member satisfaction not an increase in share
price or dividend payment, 'steady' is appropriate.
Regular sales were up by about 3% compared with last year while turnover, which is stated after
adjusting for en primeur sales invoiced to members in earlier years, was up almost 9% compared
with 2017/18. Cases per member were slightly down again this year and the number of active
members this year was flat compared with last year. Together, this meant that total volumes sold
were slightly down compared with 2017/18 but as we have seen in recent years, average case price
This year we had good cost control and no unexpected defined benefit pension charges (2017/18
£1.5m) giving profit before tax of £1.6m compared with £978k last year. We were unable to
declare a dividend again this year because the profit and loss account remains in deficit, but a
prepayment of cash into the pension scheme has enabled us to reduce the tax payable this year.
Cash balances remain strong but we are planning for substantial capital spend in the next few years
including on the IT system, Warehouse 5 and will plan to use those balances for that expenditure.
All in all a satisfactory performance in a challenging retail environment.
Co-operating for a better Wine Society
Buying wines we really believe in
When The Society was founded in 1874 our mission was clear – to find
'wines hitherto unknown' for our adventurous members. So how do we
keep our curiosity stoked and our quest for quality strong 145 years later?
We spoke to the people that know.