Moet to flow again after peace deal with supplier

French conglomerate Louis Vuitton Moet Hennessy has signed a peace deal with Woolworths’ liquor arm Endeavour Group.

It is estimated these top champagne brands alone generate more than $300m a year in sales, of which Dan Murphy’s would account for a significant portion. Picture: AFP

French conglomerate Louis Vuitton Moet Hennessy has signed a peace deal with Woolworths’ liquor arm Endeavour Group that will see the Moet champagne flowing once again at its Dan Murphy’s stores, as well as a portfolio of other popular liquor brands, following a stand off that lasted months and saw the chain run dry,

An agreement between the world’s largest owner of luxury brands, LVMH, and Endeavour Group was sealed in the last few weeks and comes just at the right time for Dan Murphy’s as Australia edges into Spring and then Summer which are key selling seasons for champagne and other festive drinks.

The Australian reported last month that Woolworths Group became embroiled in a protracted price battle with LVMH over the French luxury goods giant’s stable of best-selling liquor brands, resulting in Australia’s biggest liquor retailer Dan Murphy’s running almost dry of supplies of key LVMH brands Moet, Chandon, Veuve Clicquot, Krug, Dom Perignon, Glenmorangie whisky as well as Cloudy Bay and Cape Mentelle wine.

It is believed the stand-off began in February, when LVMH and Endeavour had a feud over pricing. Neither side would comment on the nature of the dispute, with industry gossip suggesting LVMH demanded price rises for some of its biggest selling brands such as Moet which controls around 40 per cent of the Australian champagne market but had been heavily discounted by the retailer for years.

Others suggested LVMH was irate at a recent spate of deep discounting by Dan Murphy’s for its marquee champagne brands, including ‘two for one’ offers and other price promotions that were being allegedly used as loss leaders to bring customers into the store.

Woolworths, Endeavour Group and LVMH would not comment on the price dispute, with only Endeavour Group confirming a deal had been brokered and Moet supplies, as well as other LVMH products, would be flowing back into its stores.

“Although we don’t make public comment on our commercial dealings with suppliers, we are pleased to confirm that a wide range of Moet Hennessy Australia products - from cognac to Champagne - are currently being distributed through our store networks,” a spokeswoman for Endeavour Group told The Australian.

“Most stores have already been restocked with products such as Moet & Chandon and Veuve Clicquot, just in time for the Champagne season. We would like to thank our customers for their patience.”

During the price dispute with LVMH, the nation’s largest liquor chain Dan Murphy’s was forced to take down from its website the French group’s brands with supplies almost completely depleted. Customers searching for Moet were sent to pages offering rival Mumm, while online searches for Glenmorangie on the Dan Murphy’s website were directed to Jack Daniels.

The lack of product also became evident in the stores. Most of its stores were almost empty of brands such as Moet, which commands about 40 per cent market share of the Australian champagne market, and Veuve Clicquot, which has a share of more than 15 per cent. It is estimated these top champagne brands alone generate more than $300m a year in sales, of which Dan Murphy’s would account for a significant portion.