Study on the competitiveness of European wines EXECUTIVE SUMMARY (original) (raw)

Managing the Quality Wines beyond Policies and Business Strategies

Review of contemporary business research, 2015

The premise, which has always characterized legislation for Appellation of Origin (or Geographical Indications) as an indicator of quality wines is represented by the dogma of the real or imagined interaction between the vine variety, territory, and method of production and wine business and marketing strategies. This dogma determines the variability of the range of products and supports the thesis according to which the smaller the area of origin, the easier it is to determine product homogeneity and typical characteristics. Refuting this dogma means dismantling the European model behind DOs. The aim of this paper is to try to make an answer to the following questions: a) How to regulate the high quality wines located to the upper side of the quality wine pyramid and how to cover the gap of the EU wine policy? b) Introducing a business strategy like a new wine category-inside the GI-on the top of the quality pyramid does increase the total market size and prices of the GI? c) What will be the effect on equilibrium price and quantity within the GI? The questions could be addressed following a double approach. The first examines the quality wines follows the policy approach and describes the different level of regulation in the European scenario. The second takes as an example the history of Super Tuscan wines. The framework that supports the hypothesis and a description of the six theoretical assumptions that form part of the paper will be presented analyzing the political constraints. Here we will present the necessary theoretical background for modeling and some adaptive problems will discussions in the final part.

Recent trends in the international wine market and arising research questions

Looking at the evolution of international wine trade over the last five years, the reduced growth rate and the varied performance of suppliers raise many research questions, at the micro-and macro-level. At the micro-level, research needs emerge regarding understanding consumer preferences, using innovative integrated approaches, and the exploitation of new paradigms concerning marketing strategies. At the macro-level, the key question concerns the possible evolution of international wine trade over the next 5-6 years, and the related consequences on the industry structure. Forecast of the future evolution of wine market is challenging and risky in a context dominated by discontinuities and there is not much research on how markets evolve. Nevertheless, wine economists should attend to this task with a wide multidisciplinary set of tools, also if imply an effort which is demanding and with uncertain results. After 15 years of the new century it is interesting to have a look to what is happening and which research demands arise from the available data. The year 2015 closed with a total volume of import equal to 98 million hectolitres, with an increase of 1% compared to the previous year, corresponding to a value of €23 billion, with an increase of 9%. In 15 years international trade grew by 75% in volume and doubled in value. The increase in the pace was not constant over the entire period. In general, the first part of the new century, until the international financial crisis in 2008-2009 has seen a rapid increase of international trade flows, but afterward the pace of growth became smaller, being even negative in some years. Anyway, despite the slowdown of the general growth of international wine trade, over the last 5 years the change in the structure of flows started at the beginning of the century continued. Therefore, shares of sparkling and bulk wines are increasing in value and volume, while shares of bottled wines are decreasing, and also the phenomenon of re-export is increasing. Considering the last five years, sparkling wine continued to grow with an annual rate of 7% in value and 6% in volume and bulk wine with an annual rate of 6% in value and 3% in volume. Over the same period, bottled wine grew 5% in value but only 1% in volume in terms of annual rate. Looking at the competitive performance of suppliers, it is possible to observe a variety of different situations. What was outlined in the first issue of "Wine Economics and Policy" about the first ten years of the new century still works over the last five: each competitor follows a very individual pattern in terms of areas and wine categories where it is successful or unsuccessful. Anyway, the European Union still reduces its market shares on total trade, while Chile and especially New Zealand show a fair increase of their competitive performance. This variety of situations suggests that beyond the possible role of preferential trade agreements, market by market, some suppliers are interpreting better customers; in terms of consumers and distributors needs. These essential traits of the evolution of international wine trade raise many research questions, at the micro-and macro-level.

A Country-Level Analysis of Competitive Advantage in the Wine Industry

2006

The purposes of this paper are (1) to examine driving forces and key success factors related to the increasing globalization of the wine industry, and (2) to analyze the current competitive advantage positions of four Old and five New World wine producing countries. Each country will be profiled using key industry data and analyzed regarding their national capabilities to address five key success factors that contribute to their national competitive advantage position. The countries fall into three groups with respect to their national comparative competitive advantage position. The group with the strongest competitive position includes United States, Australia, and Chile. Australia and Chile both have small populations that provide for a tiny domestic market with little potential for growth. However they are very well positioned to produce and export wine with their adaptive, large-scale producers and their great lure for foreign investments, providing them with a position of a str...

An exploration of international challenges facing wine sector in Spain

International competitiveness of Spanish and European wines is faced by growing supply, decreasing domestic demand, declining public support, and rising competition from New World producers. Resolving the wine competitiveness crisis will require restructuring processes in production and innovative strategies in trade, particularly external trade. The purpose of this paper is to explore main current and future developments affecting the global wine market and their implications from a Spanish expert viewpoint. After identifying the world wine market’s main features and conditioning regulatory factors, a prospective analysis of international trade and its expected effects on export strategies of the Spanish wine operators is carried out, using a two-stage surveying process accomplished with a representative expert group from different professional backgrounds. Broadly, results indicate that while several tendencies experienced over the last decade will be maintained and/or intensified...

The global competitiveness of European wine producers

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State of the International Wine Markets in 2022: New market trends for wines require new strategies

Wine Economics and Policy

The objective of this discussion paper is to provide an overview of the state of the global wine sector in 2022 and discuss the effects of recent events on the wine trade’s development. First, long-term trends in the global consumption and production of wine and the development of the international wine trade are discussed. The growth trend of global wine consumption ceased in 2008, but the last decade in the global wine trade has been characterised by stagnant volumes but increasing values driven by premiumisation. Several recent events have affected the volume or composition of the global wine trade: the recovery of the wine trade after Covid-19, global cost increases and inflation, the shift of Chinese wine consumption and the effect of the Russian invasion of Ukraine on Russian wine imports. The paper closes with an outlook on how underlying long-term trends might affect the strategies that successful wine business can employ in the future and suggests future areas of research i...

The German Wine Market: A Comprehensive Strategic and Economic Analysis

Beverages

Even though it is famous for beer, Germany offers one of the most attractive wine markets, exemplified by being the fourth biggest wine consumption market and a world champion in sparkling wine consumption as well as in wine imports. Still, fragmentation, intensive competition, lack of growth, and a changing environment speak to a challenging market for suppliers. In the absence of a comprehensive investigation on the market, this article aspires to deliver an economic and strategic market analysis. The statistical data is therefore complemented by the primary market research, notably online surveys on strategy and innovation, a proprietary database on wineries’ reputation, and an international expert survey on export success factors. The following market study aims to provide a concise overview covering the relevant market data, and to disclose strategic information about the German wine industry beyond pure market statistics. The German wine market, in the stable wine volume sold,...

Wine industry market strategies. Case study: Lacerta Winery

Bulletin of the Transilvania University of Brasov. Series V : Economic Sciences, 2017

Wine market in Romania is in constant development. More and more manufacturers appear on the market, and the competition is increasingly fierce. Although it has an area of the largest planted with vines, Romania is not distinguished among major exporters. Using EU funds made available, new manufacturers appear who developed the premium wine sector. Among the investments carried out in recent years in this sector is Lacerta Winery, an Austrian investment, which sold the first wine under the brand Lacerta in 2011.