My remarks last week on the wine equalisation tax (WET) situation and the role of the Winemakers’ Federation of Australia (WFA) inspired a string of comments, which can be seen here
The first response came from Andrew Wilsmore, head of risk and reputation, Endeavour Drinks Group (Woolworths). He argues there are plenty of licensed premises in Australia through which wine producers can sell their wine.
He was pulled up by Steve Knight, who explained the Queensland licensed situation, which is:
“A general licence entitles the holder to have an off-premise outlet at the location of the licence, as well as the usual bar/bistro opportunities (usually a Dan’s or 1st Choice liquor barn) and up to three satellite outlets (detached bottle-shops). So in Queensland there are four off-premise opportunities under the one ‘head licence’ as well as on-premise. So just counting licences is not a true reflection of the situation, at least not in Queensland.”
Then Paul Henry (Wine Hero) got stuck in, first to Wilsmore, saying: “While I think it is facile to maintain that the ‘big retailer duopoly’ is the ONLY problem, let’s not split hairs over what is undeniably a disproportionate and dangerously unhealthy majority share.”
It is a big share, but as I point out time and again, it is what it is, and wine producers and people like Henry have to learn how to deal with it. It is up to producers to make sure their brand or brands reach consumers, not just the retailer. I would also like to point out it is often the winery cry that because of supermarket dominance they cannot get a listing. Rarely, if ever, does one hear them say maybe part of the reason could be there were 596 wineries in 1986 and 2468 in 2016 (source: Winetitles directory).
In that same period there has also been a consolidation of larger wine producers. In 2006 Winetitles recorded 23 Australian wine producers crushing 20,000 tonnes or more. The 2016 figure is 10.
Henry then has a pop at me for criticising William Downie’s fictional story posted here
“As for Bill’s vision allegedly being naive, he has successfully built his own label – and others – across a diverse range of retailers for over a decade, including big box specialists. I back both his perspective and his experience.”
If Henry had bothered to read carefully what I wrote, he would have observed that my criticism was of Downie’s fiction, not his winemaking or his success in business. Downie wrote about the not yet defined. That is, the suggestion that winemakers will need to have a winery or an investment in a winery and their own vineyards, rather than buy grapes and rent space in a winery to make wine.
A concern and a worry it is, but Downie’s and Henry’s energy would be better spent lobbying the WFA to see what the federation is doing to get the definition that works the best for most of the industry, not the least. There are enough genuine issues in the Australian wine industry without fantasising about what might be.
For instance, they could have written about the declining WET rebate, which will hurt many very hard, and is fact, not fiction. Henry’s connection to Downie, apart from being his friend, is via the Yarra Valley-based Thousand Candles brand.
Another friend of Henry’s is McLaren Vale-based Dudley Brown (Inkwell Wines), who has written a lengthy article that I urge you to read here on the issues of WET and the WFA.
Last week the acting CEO of the WFA, Tony Battaglene, said the board was meeting this week to decide the WFA’s approach to government on the definition of winery and vineyard ownership. Brown castigates the WFA (in my opinion, rightly so). The lack of comment to the industry from Battaglene and WFA president Tony D’Aloisio is not a sign of good or confident leadership.
With the ripples of uncertainly turning into waves, and mutterings into shouts, the WFA needs to step forward and explain. And, if need be, explain again and again. The WFA is damn quick to inform all when it thinks it has done good deeds. Now the WFA is needed, where are you, D’Aloisio and Battaglene?
Whatever the coming weeks holds, let it be good for all.