“Wine sourced internationally can come with different luggage tags and different packaging, whilst the desire to obscure sources can also obscure provenance. Then there’s the dreaded failure rate due to poor (or no) systems within sources of supply.
So in practise working capital that a stockholder might have put into stock gets spent on extra pairs of hands needed to compensate to deal with low volume, high value products. High administrative expenses end up being needed to operate this model.
Liv-ex helps with that problem, because it does the heavy lifting in shipping wine, managing logistical risks and helping to manage buyer risk with its ‘Standard in Bond’ stock designation. From nowhere else can you source as much virtual stock with the pricing transparency of comparing offer prices to last trades and using that data and other parameters to filter down to a manageable list. A Liv-ex feed of virtual stock is a no-brainer for a retailer committed to the low stockholding model, but doesn’t automatically solve the immediate challenge of market differentiation.”
Read the full article here.
