May (No. 496)
The world of wine export: when will you be ready?
Dan Traucki , Wine Assist Pty Ltd
Struggling to sell their grapes in this tough environment, more and more grapegrowers are having their fruit made into wine, rather than harvest the grapes and waste them onto the ground. This means that there is a larger volume of wine sitting around in tanks awaiting sale. At first glance the sales options for these growers and other smaller wineries look pretty bleak.
The bleak outlook is due to the fact that the vast majority of wine in Australia is sold by three entities: Woolworths, Liquorland and Cellarmaster. Therefore as Woolworths and Coles continue to acquire liquor stores, there are fewer independent liquor stores, all being bombarded with wines from an ever-increasing number of producers. This makes it more difficult for a newcomer to get wines into any store.
So what are the options for someone just about to release his or her first wine? Friends, acquaintances and even local restaurants can only buy so much, thus to survive the new company needs to find an alternative outlet.
I believe that the most viable sales vehicle for these producers is export. Conventional wisdom has it that a producer has to build up a strong home market before venturing offshore. However, in these domestically-difficult times, this is not a viable strategy unless the wine company has very deep pockets. Therefore the new plan needs to reflect reality, which is: it is relatively easier to sell Australian wine overseas compared with domestically, especially when a company is just starting out.
NOTE: The complete article can be found in the May issue of The Australian & New Zealand Grapegrower & Winemaker.