Some distributors recently revealed to WBO that all Hennessy products would undergo a new round of price adjustments, and the prices of all products would increase by 1.6%. In this regard, WBO interviewed relevant industry insiders.
An unnamed distributor revealed to WBO that Hennessy’s price increase was a brand-side price adjustment, and the price rise for the entire product range was 1.6 percent. He also told us that Martell would follow suit this time.
Chen Feijian, another spirits distributor in charge of Foshan Hexi Liquor, also said that he had heard about the news of Hennessy's price increase, and he expects the wholesale price to increase by about 4%.
However, Chen Hongjun, the head of Foshan Jinpin Liquor Company, predicts that the wholesale price will rise between 3% and 5% and retail price between 5% and 8%. He also predicts that other brands would likely follow suit.
A distributor of imported spirits in Yunnan also confirmed the price increase, adding the manufacturers will work to meet with the price rise by controlling shipments.
After the news release of price increase, is Hennessy now sufficiently stocked on the market?
The distributors mentioned above all stated that there is no shortage of Hennessy’s supply for the time being. Although the international logistics has not fully recovered due to the impact of the epidemic this year, the goods in their hands are still abundant because of the sufficient stock prepared before the Chinese New Year and the limited consumption during the Spring Festival.
One distributor said he was also puzzled by a slight reduction in the price of Hennessy’s parallel goods. He wondered whether he would lose some licensed goods clients due to the rise and fall of the price.
Some other distributors said that since news of the price increase has come out, they hope to prepare more stock for a rainy day
Recently, the leading Baijiu companies raised their price in the off-season. WBO has also previously reported that Penfolds, the leading imported wine brand, has increased the prices of some of its products by 5%-10% starting July 1.
Chen Feijian told us that Hennessy's price increase is not unrelated to the current industry environment. Since the price of liquor and wine has increased, leading spirits brands also need to raise the price to stabilize their market positions.
Chen Hongjun said that the Hennessy price increase this time is a routine price adjustment within an acceptable range.
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