AUSSINO - CHINA'S BIGGEST OPERATOR OF WINE SHOPS
The Aussino Wine Cellar in Guangzhou city.
The design of Aussino Wine Cellars are European in inspiration.
"My message to the Bordeaux First and Second Growths is: 'Don't put up your prices too much'," Robert SHUM, founder of Aussino.
The biggest operator of free-standing wine shops in China is a company named Aussino (unrelated to another company, also named Aussino, which is a publicly listed company in Singapore famous for its bedding and home linens).
Aussino World Wines (www.aussino.net), to give the Guangzhou-based company its full name, is headed by Robert SHUM (沈宇辉), originally from Guangzhou but who went to Australia, and then back to Guangzhou where, in 1995, he registered the company which name reflects his personal odyssey. (The Chinese name for Aussino is 富隆酒业, literally, 'Rich Prosperity Wine Business').
"We started operations in 1996 as an importer of food, including meats, and wine. Two years later, in 1997, we became 100% wine focused."
Shum had cultivated his love of wine in Australia when, in 1984, he went to Sydney for studies. He visited many Australian wineries and, in his own words, evolved "from a wine lover to collector".
Aussino was conceived out of passion and an acute business sense.
"Before starting the company, we did business research and discovered that a lot of people in China had started to drink wine, but had no appreciation of it. They mixed Sprite with Lafite and Petrus. Today, maybe, it still happens inland but it the frontier and capital cities, no more," Robert Shum observes.
The enterprising founder of Aussino accurately diagnosed that China needed wine appreciation. It was as if he was starting from ground zero.
"I also realized that this type of wine business, in which you want to spread wine appreciation, is only suitable for two types of people. Either you are a wine lover or you are the son of a very rich man. The reason is because this is a long-term type of business in which you have to build brands while also spreading wine appreciation. It's different from a wine trading business which can be built up overnight," Shum opines.
Although Aussino started on a small scale, just two years later in 1998, the business began operations in Beijing. Indeed, Robert Shum moved to the Chinese capital where he lived for two years. All that time, Aussino was a wine distributor. And did not get into wine retailing until five years later.
What had prompted the move was more incidental than a long-thought out business plan. In fact, the first Aussino 'Wine Cellar' was not in Robert Shum's birth city of Guangzhou but some 470 kilometres away in Shantou where, although still in Guangdong Province, the inhabitants speak a totally different dialect called Teochew or Chiuchow.
"A good friend from Shantou had returned from Australia. He owned the building itself and, because of that, could control the cost of this new business concept. That was how the first Aussino Wine Cellar started in 2003," Shum remembers.
The Shantou Aussino Wine Cellar is a franchise. In 2006, Robert Shum started the second wine cellar in his home city which is entirely owned by the company.
"The standard was of a higher level for the Guangzhou wine cellar. We pegged it to an international level because we hope to take the concept to the other big cities in the country."
When I asked if that includes Macau, Shum's reply reveals the cautious yet enterprising businessman that he is.
"I don't understand the market in Macau. Maybe my son will do that one day (Shum's son is 5 years old). China is already such a huge market. Since we started in 1996 to 2008, we have grown 50 times."
Aussino is a wine distributor, importer and wine retailer.
"The are two arms of the business. The first is to sell to hotels, restaurants, department stores, clubs, cafes and Chinese restaurants. The second arm is building up our retail outlets," Shum explains.
When Aussino started operations back in 1995, importing and distributing wine represented 80% of the business with the balance 20% devoted to wine retailing. Today, the two arms are about equal in importance to the company.
Regardless of whether it is wine distribution or retailing, the 'back-up' of publications and materials available to the customer or consumer provided by Aussino is impressive.
"Our company is very respectful of education. We publish our own wine guides which are also sold in other wine shops. We also publish a quarterly magazine called Aussino Wine Life. And there is also a bi-lingual Chinese/English website."
As far as its retail operations are concerned, the Guangzhou and Beijing outlets are all 100% owned by the company. As for the outlets in Shanghai, Chengdu, Chonqing and Wuhan, those are joint-ventures. In all other cities, the outlets are owned by franchisees.
Whether joint-ventures or franchisees, the retail outlets have to attain a standard of design and finish to the satisfaction of Aussino. At the same time, they are also obliged to only carry stocks purchased from the company's list and inventory.
The success of Aussino is such that, today, it is regarded as one of most important wine players in the most populous country in the world.
Read More... Q & A WITH ROBERT SHUM
Read More... AUSSINO'S FOUR RETAIL CONCEPTS