Wine entrepreneur beats the downturn

“I used to be a venture capitalist at Apex Partners,” says Hutchinson. “It made me very cynical. I spent a lot of time picking holes in business plans.”

But when Hutchinson came across Enomatic’s sampling machines five years ago, the cynic had a lightbulb moment. “They enable customers to self-serve themselves a small sample of wine,” he says. “I was always interested in the wine trade and saw huge potential in a new business model based on ‘try before you buy’.”

So confident was Hutchinson that he invested £350,000 of his own cash into his first startup, a high-street wine shop he named The Sampler. He managed to raise a further £1m from a panel of investors, giving up 35 per cent of the business, and opened a store in Islington.”

“The Sampler is very different to any other business model,” says Hutchinson. “Wine at somewhere like Threshers tends to be discount or offer driven. That model isn’t going to last; they simply can’t compete with the supermarkets.”

The Sampler allows customers to try a whole range of wines, from run of the mill to very expensive, before they commit to buying them. “The machines keep the wine at the right temperature etc. We charge a small amount for each tester and customers can buy as many as they want. It’s fun and informal and the ‘tasting’ means that consumers invariably buy quality wines.”

The average bottle sale at The Sampler is higher than any other wine shop in the country. “People nearly always buy the £15 bottle over the £10 bottle,” says Hutchinson. “And we have the advantage of people paying for the samples as well.”

So why isn’t every other wine shop jumping on the bandwagon? “There are a few barriers to entry,” says Hutchinson. “Firstly, the machines cost £10,000 each and even huge wine warehouses like Majestic can’t afford the investment right now. Secondly, we have a very close relationship with the manufacturers of the machines. They know that we have an aggressive growth strategy which benefits their company, so they support us.”

Hutchinson plans to have six sites within two and a half years, generating a turnover of £10m. “Even the recession can’t dent our optimism,” he says. “The market doesn’t fluctuate with the economy; people might shift away from buying wine in restaurants but they still buy it to drink at home. Plus the drop in rental prices makes it easier for us to acquire property and it’s cheaper to hire employees.”

Cheers to that!

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