Chateau de Vallois

Jennifer Xing 1. The disadvantages of Chateau de V altogetherois freeing into the cheap wine-coloured market 1) Launching a refreshing-made product, and introduction a new market will require large investment funds upfront, for doing research, hiring new supply, acquiring new land. 2) It is a risky investment since the new product market is very foreign to the company. The market, competitors, consumer preference, steady the climate is unfamiliar for the company. ) The launch of cheap wine may hurt the commemorate name insure of the luxury line. Consumers may feel less reputable if they suspect that the grapes are not attended to as well as before, because the new winery took time away from taking care of the traditional land.Consumers may alike suspect that the wine is made out of grapes that are used to open cheap wine, thus less willing to buy the expensive wine from the company. The advantages ) Chateau de Vallois can diversify away the financial risk of a discon solate year for grapes or economics depression, by having a operation in California that is not as elastic as the luxury brand 2) With the new cheap brand, Chateau de Vallois will be able to set aside a broader base of consumers. The family brand name will occupy a large share of the wine indus smack. 3) The new cheap brand, if captures the young consumers, when the young manner for good wines, they will be more likely to look into Chateau de Vallois high(prenominal) price wine. 2.Claire is forward looking, profit-driven, and expansionary, while Francois is traditional, reserved, and risk-averse. Gaspard can keep everybody happy by allowing Claire to set up a different brand in California, and devote the France winery to Francois. The different brand is essential not a stir up of Chateau de Vallois, thus Francois wouldnt worry while Claire can still try out her business venture. 3. Three specific suggestions 1) Claire can start from affect in California, acquire existing win ery or start with a joint venture.I suggest an acquisition of existing winery, so Claire will bring forth the expertise of the existing staff members who are familiar with the estate 2) Claire must design a new brand and logo separate from Chateau de Vallois, and be listed as a subsidiary, so the new brand enjoys the benefit of the prestigious brand name, but do not necessarily hurt the brand by entering the cheap market 3) Claire should bring in staff and experts from France to train the California staff of quality control, procedures and company culture.It is after all a Chateau de Vallois brand, and what can distinguish this new brand from other wines is its Chateau de Vallois family name. 4. I agree with de Rothschild that the winery could and should expand. I do not see the new expansion as a threat to the image of the older brand, specially if the new brand is well managed with ensured high quality that can even add to the brand prestige.Johnny Walker didnt even bother to mixed bag the name of the brand, but its colored labels are very successful, catering to a spectrum of consumers. There are many upsides of the expansion. The new brand can capture new consumer segment, the new consumers can transfer to higher end wines, and the higher end buyers might even want to drink the cheaper kind on a more daily basis instead of putting the nearly expensive into wine cellar.