Indage Vintners shuts regional offices

In an attempt to reduce costs, India's biggest wine producer, Indage Vintners, has started closing its regional offices, while centralising all sales and marketing activities at its headquarters in Mumbai.

The Rs 300-crore company had already shut its regional office in Kolkata and would be shutting down others also, it confirmed in an e-mail reply. Currently, the company has 10 regional offices in India.

Indage Vintners employees allege that the company has not paid reimbursements and office expenses since July 2008. West Bengal and East India offices alone have 70 employees. "We want our dues to be settled and we are ready to leave," some employees in Kolkata told Business Standard.

Reacting to the allegation, a company spokesperson said, "We cannot comment on employee salaries and reimbursements as a policy. However, the company has consolidated and centralised its sales, marketing and MIS functions, thereby closing its regional offices. This is with the aim of achieving higher brand management efficiency and lower costs. Indage Vintners has around 44 distribution centres across India and approximately 10 across the globe."

Wine stores in Kolkata said the company has not sent any fresh supplies to West Bengal for a few months now as permits from the excise department had lapsed.

Distributors in Kolkata said they had stocks pending sale. The company spokesperson, however, countered, "We may have closed the regional office but we will continue to supply to all regions through our distributors."

The company spokesperson admitted that "...the recession has put pressure on our margins as consumers look for value and we have been spending more to give more value. People who earlier would purchase six bottles at $5 are now looking at purchasing eight bottles for the same price. India has wider margins and restructuring will give us cost savings of Rs 35 crore in the next financial year."

As a first step, Indage Vintners has this year introduced five lower-end (read cheaper) labels for the new wine drinker on a budget-Trio, Mojo, Silverton, Blue Elephant and South Bay, all in screwcaps. The cheapest of the new labels is Trio, which costs Rs 144. Mojo and Blue Elephant are priced at Rs 204, while Silverton and South Bay have been priced at Rs 270 and Rs 396, respectively.