Oddbins business in administration due to Brexit – or is it?

01 February 2019 - Elizabeth O'Hanlon

It was Winston Churchill who is reputed to have said, "never let a good crisis go to waste".
Whilst the UK’s politicians have hardly covered themselves in glory over the past two years, laying the blame for the disruption in the UK wine market solely at the door of Brexit could be regarded as questionable– particularly, as we haven’t actually Brexit-ed yet.
Indeed, it is easy to imagine domestic consumption of wine increasing if the indecision and divisions of Westminster continues!
One thing however which these times of uncertainty have demonstrated, is the significant effect that the media can have on business. 
It is true that when it comes to the market for wines and spirits, New World producers such as New Zealand and Chile are clearly outside the EU, so, whilst there will inevitably be a knock-on effect of Brexit on the wine supply chain, it is debatable how much to attribute the Brexit crisis to the fundamental reasons behind the fate of Oddbins.
A more credible explanation, as acknowledged in Oddbins’ own statement is "the deterioration of the high street…has resulted in an unsustainable, tough physical retail market." Could it be that our changing shopping habits have impacted this one-time market leader, rather than Brexit?
After all, we know that the way we buy our wine has changed in recent years– the likes of The Wine Society, Naked Wine and Virgin have all been successful by offering online and mail order services. By bulk purchasing and embracing web-based ordering and fulfilment, they have adapted to the changing demands of their market, and so you could argue that it is these merchant disruptors, not Brexit, who have most hurt the local Oddbins store on the corner of the street.
Whilst these current uncertainties are dreadful for the individual employees involved, it is important to note that this is the second time Oddbins has been through a formal insolvency process (the last time being 2011, when Brexit was a mere twinkle in Nigel Farage's eye). The very fact that this latest announcement is outlining a "pre-pack" arrangement to rescue the profitable parts of the business perhaps reveals the truth of the matter: that the Oddbins retail model has become outdated and out-competed. Which is arguably despite, not because of, Brexit.
It has been long accepted that the gossip, and false information coming from some parts of the media can have a catastrophic impact on the actions and reactions of international markets. Now more than ever, as the UK enters one its most challenging economic periods it is vital that a pragmatic and cautious eye is cast over the seemingly unending stream of bad news stories. 
Hopefully, we can raise a glass to a new Oddbins business emerging at some point, but to end as this piece began, with another quote from Churchill “A lie gets halfway around the world before the truth has a chance to get its pants on”.

Related news

Get in touch for forward-thinking, impartial advice

With offices in Cambridge, Colchester, Diss and Ipswich, we’re close enough for personal meetings with clients from anywhere across the East of England. Got something on your mind? We’ll be happy to listen and give you our thoughts.

Call us on 0330 058 6559
Email us at hello@scruttonbland.co.uk

Get in touch