We know that for many consumers, the price of champagne seems excessively high. Consequently, this beverage is sometimes overlooked due to the cost of a champagne bottle. However, while some countries like Italy or Spain can produce sparkling wine at a much lower cost, how much does a bottle of champagne cost? What factors are taken into account to determine the price of a bottle of champagne?
Producing champagne involves five major categories of expenses and production costs. Therefore, the price of a champagne bottle must be determined based on its production cost. Among the costs to consider are the following:
- Champagne price related to terroir
- Main expense categories
- Cost of vineyard work
- Cost of winemaking work
- Cost of exceptional cuvées
- Cost of packaging
- Cost of bringing to market
Champagne Price Related to Terroir
If the price of a champagne bottle is high compared to other sparkling wines, it's also related to its origin. Indeed, in Champagne, the price of the vineyard itself is very high. The price per hectare of vineyard is much higher compared to other regions.
Furthermore, the process of the Champagne method is very strict. The standards are stringent to comply with the AOC (Appellation d'Origine Contrôlée). On the other hand, the annual sales volume of the Champagne appellation is not sufficient to maintain low champagne prices.
In addition to this, disastrous weather conditions can sometimes come into play. Inclement weather, frost, diseases—harvests are not always glorious. The rarity of the product and lower-quality harvests can significantly affect the price of a champagne bottle.
If a major health crisis comes along, the entire champagne industry can collapse. At De Lozey, we continued working to maintain production, as explained in a blog article. While vineyard work continues, the decrease in revenue and sales has been felt. Expenses, on the other hand, remain, potentially leading to price fluctuations for champagne.
Main Expense Categories
If we look closely at the price of a bottle of a major champagne brand, it will be composed as follows:
- 24.8% is related to the cost of grapes, their production, and processing
- 9% is for vinification costs
- 3.1% represents glass expenses
- 1.9% covers label and cork costs
- 15.2% accounts for marketing expenses
- 6.3% comprises costs related to wine centers
- 23% represents the distributor's margin
- 16.7% represents the value-added tax (VAT)
Therefore, to determine the price of a bottle of champagne, major champagne houses must consider all these factors.
As for the expenses of winemaking growers, the breakdown may be slightly different. For example, in the case of our De Lozey estate, we cultivate our own grapes. Consequently, the cost of raw materials is lower, and the work is often done within the family. Moreover, marketing and promotion costs are reduced.
Indeed, the production of champagne by small growers has a familial character. It is quite different from major champagne brands that produce larger quantities. At De Lozey, we prioritize direct contact with our customers rather than extensive marketing efforts. We focus on personal connections rather than large trade shows, highly sophisticated media campaigns, or extravagant tasting events.
Cost of Vineyard Work
For vineyard growers, vineyard work is significant. Vineyard work is a year-round endeavor, spanning 12 consecutive months. For many people, it is limited to the harvest season. However, winter work on the vineyard is also essential. In fact, we invite you to take a tour of the De Lozey champagne vineyards to discover what happens in the vineyard during the winter.
As you have discovered in this article, pruning and trellising work is essential for vine development. These tasks can only be done manually, making labor costs significant. In Champagne, for some Grand Crus, grapes cost 2 to 3 times more than the national average. It costs approximately between €6 and €7.20 per kilogram of grapes. Considering that 1.2 kilograms of grapes are needed for a bottle of champagne, the minimum price of a champagne bottle produced is €7.20.
Cost of Winemaking Work
In addition to vineyard work costs, there are costs associated with various stages of winemaking. As you will see when reading our article on champagne: the step-by-step manufacturing process, each stage incurs costs. These contribute to increasing production costs.
Furthermore, the containers used for winemaking are also significant. For example, when producing our oak-aged Blanc de Blancs champagne, the production cost in oak barrels is not the same as in oval tanks.
Additionally, making champagne using the Traditional Method requires time and numerous manual manipulations. Many steps must be done by hand. This explains why the price of a champagne bottle can vary. Especially when it comes to a reserve wine or champagne with extended aging.
Finally, many winemakers are committed to organic farming. Our De Lozey estate has, in fact, obtained two new certifications. However, implementing standards to protect the environment and promote biodiversity incurs additional costs that affect the price of champagne.
Discover our Brut Tradition
Delightfully fruity, energetic, refreshing, and easy to enjoy, it's the essential champagne, the safe choice. A classic champagne that will truly tantalize your taste buds.
Cost of Exceptional Cuvées
When looking at different champagne bottles, such as those in our De Lozey champagne range, you may notice different champagne bottle prices. It is, therefore, normal to wonder why the selling price of our Cuvée des Gentlemen is higher than our Blanc de Noirs? Why is a vintage wine much more expensive than a Brut Tradition champagne?
In fact, the production cost of prestige cuvées or vintages is higher. This consequently results in a much higher price for a champagne bottle. The aging time also affects production costs and impacts the selling price.
On the other hand, champagnes priced under 25 euros or under 30 euros are blends. They are created by blending wines from different years, regions, or grape varieties. Their aging time is typically around 15 months for the majority. These champagnes are known as Non-Vintage Brut (Brut Sans Année or BSA). Among them, you will find:
- Prestige cuvées with aging ranging from 5 to 10 years
- Reserve cuvées produced mostly with reserve wines
- Vintages made from wines of a single year.
Regarding vintage wines, the price depends on the year. Thus, each year has its own characteristics with specific vine treatments or none. Therefore, the price of a bottle may differ depending on whether it is a 1999 vintage or a 2006 vintage. Furthermore, the aging of a vintage champagne is much longer, as it must age for at least 36 months.
Finally, the price of a bottle of champagne for a single grape variety champagne or a rosé is always much higher. For example, a 100% Chardonnay Blanc de Blancs or a 100% Pinot Noir Blanc de Noirs champagne has a higher bottle price than a BSA champagne. Generally, this is because single grape variety plots have higher quality exposure, and the vineyards are often older.
As for rosé champagnes, especially De Lozey's Rosé de Saignée champagne, they require more work. This explains why the price of a rosé champagne bottle is higher than other champagnes.
Discover our Rosé de Saignée
Sensual, our rosé surprises with its color and dazzles with its intense taste. Its assertive character will delight connoisseurs and astonish newcomers.
Cost of Packaging
"When the wine is drawn, it must be consumed," says the old adage. Here, it would be more appropriate to say that when the champagne is ready, it must be bottled. However, bottling naturally incurs costs that will affect the price of a champagne bottle.
Packaging costs include the following expenses:
- The cost of bottles, which naturally varies depending on the different bottle types. It should be noted that in the Champagne region, there are different bottle sizes corresponding to various capacities. Thus, we have various names for champagne bottles.
- The cost of supplies, including labels, corks, capsules, boxes, export pallets, and various supplies.
- Bottling services themselves, which also include filtration expenses.
- Various expenses related to buildings and fixed operating costs.
In the end, taking all these expense categories into account, the cost of packaging for a bottle can vary between €1.10 and €3.00 per bottle. Of course, these costs are only averages.
Cost of Bringing to Market
Once champagne bottles are ready for commercialization, an additional expense category needs to be considered. Indeed, commercialization and bringing to market also have a cost and incur expenses:
- Commercial service: prospecting, customer reception, mailing, digital services, commercial management, shipping. Each of these tasks may require one or more individuals, depending on their versatility.
- Commercial activities: commercial activities such as trade shows naturally provide great visibility but also increase costs that can impact the price of a champagne bottle. Trade show expenses, which involve travel over several days, can vary between €2,000 and €5,000.
- Delivery costs: whether it is shipping expenses or delivery costs to a distributor, transportation costs are factored into the price of champagne.
Many winemakers, therefore, turn to direct sales at the estate to try to limit these bringing-to-market expenses.
Now you know everything about what a bottle of champagne costs. Don't forget that the price of a bottle of champagne also depends on each winemaker. You can easily see that champagne houses like De Lozey do not generate a large profit margin. However, the added value lies in the quality of the champagnes and in favoring short and high-quality distribution channels.
It is now certain that when you see the price of a bottle of champagne, your perspective will likely change. What if the price of champagne became a guarantee of quality? And if you want to make sure that the price is justified, we invite you to read our article "How to Recognize a Real Champagne?" Our article "Is All Champagne from Champagne?" will also help you navigate through all the appellations.