Agribusiness, hobby vignerons, NZ tosh, Vison Wine Partners

Good idea or not?

The news that Wine Australia has developed a flavour guide to help translate Australian wine descriptions into Chinese is fascinating.

No doubt a great deal of thought, discussion and work has gone into producing the chart. But TKR is not as convinced as others about its worth.

The idea is to use the card at cellar doors or retailers to guide Chinese customers through the tasting process, as it links an English sensory term to the equivalent identified by the Chinese consumers in the research project.

We can see the logic in producing the card, but ask the question: is there any logic in flavour descriptions to wine? It’s open to debate, so please do so, and send us a comment.

And this is news?

An article in The Australian Financial Review on March 21 opened with:

“Low prices, lack of demand and high costs are forcing many owners of hobby farm wineries to plough up their vines or create an outlet for their home-grown labels, agricultural specialists say.”

Really, is anyone in this industry, whether long-term professional or hobby winery, surprised at this news?

When TKR discussed this issue with others who have spent decades in the industry/trade (collectively well into the century), many comments were offered. The following was from Robert Joseph, writer, consultant and wine producer:

“Globally, the wine industry offers a poor return on investment (ROI). Many producers exhibit poor marketing, distributing and pricing skills.

It’s a politically incorrect thought, but the commercial un-professionalism of a majority of those producers – in the Old World – is explained because they are effectively peasant farmers who inherited their vineyards from previous generations. They have no investment on which to seek a return.

“Among the others – often in the New World – many are hobbyists who also often lack the incentive to worry about ROI. Both these groups screw up the market for the real professionals.”

In the AFR article an agribusiness valuer said these hobby vignerons were mostly city professionals, such as lawyers, doctors or dentists. Apparently these professionals were cashed up but had little business savvy.

Having plenty of cash comes about by being savvy. Doctors, dentists and lawyers are among some of the greediest people TKR has met; they charge like the proverbial bull.

It was mainly greed that led these professionals to dabble in wine, and greed deserves to be punished.

The article also cites a success story: that of Steve and Trish Coleman, of Quoin Hill Vineyard, near Ballarat, Victoria. TKR congratulates them but their story is one of hard work, not greed.

We know of a High Court judge who produces excellent wine and says that when pruning on a freezing morning he often gets his thoughts in order for the case in which he is involved. Another professional told us he had an 11-year business plan and hoped his vineyard would become profitable before that time, though it was better to be cautious.

Both Woolworths and Coles receive a lot of flak for selling wine at low prices and putting pressure on producers to provide wine that is uneconomical for them to produce. Counteracting this is the host of producers who have struck a deal with either or both to provide wine from which all parties are earning.

What damage is inflicted on neighbours when a winery owner one day wakes up realising there is a shed full of wine going back several vintages so decides to sell the stock at rock bottom prices? The region’s wines that normally sell at $15 to $30, maybe more, can be found at $5 to $10. Visitors think the other wineries are ripping them off.

What a whinge

NZ Farming carried an article by Gerard Hutching on March 21 headed “Tasmanian growers undercut New Zealand with export subsidy”.

It’s about the Tasmanian Freight Equalisation Scheme, which gives Commonwealth Government financial assistance to shippers of freight between Tasmania and mainland Australia. It was established in 1976, updated in 2008, and from January 1 this year the scheme was extended again to include eligible goods being shipped to the mainland regardless of their final destination.

The amount of assistance is based on the difference between the freight costs of moving goods by sea and the notional freight costs of moving them by road over an equivalent distance. The scheme’s objective is to provide Tasmanian industries with equal opportunities to compete in other markets, recognising that, unlike their mainland counterparts, Tasmanian shippers do not have the option of transporting goods interstate by road or rail.

Now the New Zealanders are whingeing about it, saying it allows Tasmania to undercut New Zealand in overseas markets. The article cites cherries (5-kilogram box) being NZ$22 ($19.56) cheaper in Asia than New Zealand cherries. Also it costs onion exporters NZ$1500 more per container on shipping to Europe. The article notes that the scheme applies to wine as well.

It’s such a load of tosh.

Age is not old

Is wine a young person’s game? I think not, but then I would say that as I’m over 60. Old I may be but I do hope I’m not as dull as some of the 30-40 year olds I meet. Anyhow to the story, two old mates Mike Every and Nick Blair both having been retrenched from their corporate wine companies have found their combined 50 years international management experience across all facets of the wine industry is not working in their favour when applying for jobs.

Taking their future into their own hands they have joined forces and set up Vison Wine Partners and are offering:

  • Market mapping
  • Route to Market review
  • Strategic Channel management
  • Distribution review
  • Pricing strategy development
  • Strategic Retail partnerships
  • Business Plan development
  • (Strategic/Brand/Portfolio/Pricing/RTM/Execution and critical path…)
  • Resource planning: Mentoring and Management

Visit the website for more infomation

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