Demise of Orbital Wines leaves industry searching for answers.

(From Off Licence News)

The collapse of Orbital Wines leaves the trade a sadder, perhaps wiser, place. The Stormhoek and Camden Park business enlivened the industry with its quirky marketing and enthusiastic people determined to break the wine trade mould. Unfortunately, it's Orbital itself which lies in pieces. So what, if anything, can be learned from its demise? With the economy in "red alert" mode, and even retailers like Tesco and AMajestic struggling to set the world alight with their wine sales over the Christmas Aperiod, medium and small-sized suppliers are approaching 2008 with understandable anxiety.

As one drinks trade analyst puts it: "There are quite a few companies at the moment who are looking at their ADecember results and expecting the next three to six months to be very difficult. The implications for these companies of the economic slowdown, probably exacerbated by a duty increase, could be very serious indeed." The first of many? Those closest to the collapse of Orbital suggest that not all the factors involved in the company's closure were down to market conditions, though probing these at a time when 10 people have just lost their jobs feels like an intrusion into private grief. The company, which always punched above its weight in terms of publicity, had the feel of a supergroup about it: some talented, experienced professionals with big personalities and bigger ambitions. Critics have accused it of having "too many chiefs and not enough Indians", despite running brands that had yet to fully deliver on their promise.

Those criticisms aside, rivals have been watching the Orbital saga unfold with a mixture of pity and fear, because there is a general feeling that this won' be the only well-known UK supplier to bite the dust this year. The pressure on wine importers has been escalating for some time, and businesses who warned that they were running out of slack a few years ago are now stretched almost to breaking point.

"It's a very volatile time and this year I imagine there is going to be a fallout," says Bill Rolfe, whose 10 International wine business has been operating for two years. "This [Orbital's demise] is the first sign of it and I wouldn' be surprised if other wine agencies are also in a very difficult position." Making ends meet Rolfe's determination to keep Aoutgoings at an absolute minimum have, he hopes, given the business some protection from the economic storm.

"You can' let overheads run away. Building a team and spending money on marketing is obviously where the costs are a but when do you do it? Do you try to establish your position and get your momentum going, and then spend ? Or spend upfront and hope that it comes? That's the big ...