Trusting wine Brokes

Too much trust is put into the advise of fine wine brokers, as if they themselves are expert analyst of the market.
This is not the case.
How they come to sound so knowledgeable is courtesy of using far too much wine jargon.
They need to sound knowledgeable due to having daily, weekly and monthly wine sales targets to hit so as to secure their job for another couple of months.
However, this means that the blind faith many investors have put into these brokers’ “expert” opinions, if continued, will lead them down the road of loss, not profit.
Fine wine jargon busting time
Whilst being trained-up as a fine wine broker, I was constantly being told, “Clients do not buy the wine. They buy your enthusiasm and conviction in the wine and the story (the story consisted of a broker predicting the future profits their client could make if they were to purchase the recommended wine).”
This may sound ridiculous, but I was forever seeing this work.
The way in which this happened was purely due to quality hard sales skills.
We were constantly being encouraged to listen to music that would get the juices going or read literature on hard sales, as well as being recommended to get inspiration from films such as Boiler Room on how to be good at our job.
It was after I had watched the above recommended movie that I began to detect that the delightful world of fine wine investment was not so.
I presumed I had simply received poor advice and so I taught myself the ins and outs of the market.
Instead of spending my time watching such nonsense, I spent my time delving into page upon page of prestigious fine wine publications such as erobertparker.com , Decanter and Wine Spectator among others. I would often spend many a lunch break investigating price movements that were actually achieved by particular wines and the reasons why they moved.
I wanted to be at the point where no matter what, I could provide my well protected and slowly growing client base with accurate and actionable advice that would greatly heighten their chance of achieving a profit.
More often than not, this would mean that the best thing for them to do was not to buy the recommendations or grade of wine being offered by the company.
Basically, what I am getting at is the fact that fine wine brokers, when getting past the often pompous exterior portrayed for clients (which too is a sales technique) are basically salesmen who do not care which vintages you put your hard earned funds into, so long as some of it makes its way to their pockets via commission.
Why these particular fine wines?
The presumption could be that a broker cannot be expected to know all the ins and outs of the particular wines that they are selling as there is just too much.
Sure. That is what analysts and sommelier’s are for I suppose.
However, when you think about this, they are simply being told to sell, whether it be for your genuine benefit or not. But, many fine wine brokers tend not to care whether or not you are paying for top, investment grade wines. Reason being, the turn around of brokers in this market is within a 1-4 year period.
I take it you have noticed a new voice coming down your phone every couple of years? These brokers know they will not be serving you in that role forever. I was told that I would be unlikely to have a lengthy career at that firm on my first day of training!
Therefore, the less ethical of the bunch are willing to pitch you anything at any cost – to your pocket – as they know they will not need to face the music when your are annoyed that your wines have not even made enough profit yet to make-up for the brokerage and storage fees when it comes time to sell.
For example, if a broker knows that you only want to deal with wines that will show you a 20% profit per annum over a five year hold (100% over 5 years), they may well pitch to you that “This wines I am bringing to you will show you such returns sooner rather than later.”
Now, this wine may well require 10 – 15+ years to achieve such returns, due to high production levels, the current status of the winery not being internationally known or respected in the fine wine connoisseur’s world, etc. Yet unless you do your own due diligence, you will be clueless.
So, if you are relying exclusively on the recommendations and expertise of your fine wine broker, you are asking for trouble.
It’s a sales job at the end of the day…
My experiences of the fine wine broking environment were sometimes a carbon copy of scenes from the movie Boiler Room. Sell. Sell. Sell was the order of every single day.
There were targets that needed to be met. These targets can range from 20k – 200k per month per individual depending on the wines being sold (a case of French Bordeaux sells at a much higher price than a case of most New World wines).
Failure to meet target on too regular an occasion resulted in the broker being called into the MDs office for a “brief chat”, followed by them receiving their marching orders.
I witnessed this often.
This was an obvious incentive. It worked for me.
For my first few months in the market I, like you, too presumed that every single wine I was recommending to my clients was going to show them massive rates of return within the first 5 years. Why else would a company sell them to their customers?
However, once I discovered the unethical practices of this particular fine wine brokerage, and that many others behaved in a similar way, my job became substantially harder to keep.
From that point on, I was only ever willing to sell my clients wines that would actually make them money, which infuriated my bosses.
Once a wine had received my seal of approval, I was all for recommending my client’s to purchase it.
So now what?
I recommend Crimson fine Wines they are a top Service for wine investment and are always there to help