The first commercial release of
Penfolds Grange of the 1952 vintage was for less than $1, an
extraordinary amount in those days. That bottle today sells for over $16,000. Over
the years Penfolds were always at the forefront of pricing controversy. The release
of the 1976 made headlines for the amazing asking price of $20 per bottle, the first
Australian wine to breach that barrier. With each successive vintage, Penfolds applied
a modest 10% to 15% increase while the secondary market would then quickly bid up
the new releases. The world acclaimed 1990 Penfolds Grange release in 1995 had retail
buyers snapping up as much Grange stock as they could for $140 and flipping it on
the secondary market a short time later for $300. There came a time when you could
not buy bottles of Penfolds Grange at retail as it became common practice for
Australian wine retailers to stash away their stock from the public and bring it
out a few months later to sell at auction. Penfolds could have capitalised on this
price differential many years earlier than it did but held off from profiteering back then. Finally, to restore equilibrium in the market place,
Penfolds had no choice but to raise the retail level of Penfolds Grange to the same
price the retailers appeared to value it through the secondary market and thus restore
its place on the bottle shop shelves. It was at this juncture that Penfolds Grange
was no longer a quick and easy investment prospect, either long term or short term.
In summary, the investment potential of Penfolds Grange
From the mid 1950's through
to the late 1990's, if you purchased the latest release Penfolds Grange from your
local bottle shop at the Penfolds recommended retail price you could expect to make
a tidy profit by reselling it within a few months and even more if it was a great
vintage and you held it for a decade or two. That all changed when Penfolds upped
the recommended retail price to the, then, current auction price.
Since then Penfolds
have been steadily increasing the retail price until it now leads auction values. Now
it has very limited investment potential unless you
can purchase it less than the current auction market value or you can locate a new
secondary market to sell into.
Whilst it is still possible to make some profit from buying and selling Penfolds
Grange, you need to be very careful about the provenance and do your homework
about its on-sale potential before you commit to purchase.
Penfolds Grange, further information
Further reading on wine investment
Wine Investment Snippet
Author: Mark Wickman
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