Australia’s small winemakers report strong growth

Australia’s small winemakers have reported strong growth in revenue and production across all sales channels for the second consecutive year, according to the findings of Wine Australia’s Small Winemaker Production and Sales Survey 2016–17 report published today. 

Both production and revenue for small winemakers (categorised as those crushing up to 500 tonnes) grew
by 10 per cent in 2016–17. Small winemakers contribute an estimated 8 per cent to the total Australian winegrape crush and $1.3 billion of wine sales.

The vast majority of wine sales for Australia’s small winemakers are in the domestic market; with retailers accounting for almost half of all wine sales and cellar door nearly one third.

Cellar doors and export markets were identified by small winemakers as presenting the best business opportunities over the next five years.

Wine Australia CEO Andreas Clark said the findings of the report show that the growing enthusiasm for Australian wine in export markets and for regional wine tourism experiences has boosted the confidence of small winemakers.

‘The report shows that while export markets currently account for 14 per cent of their wine sales on average, our smaller winemakers are optimistic about the increasing sales opportunities from export markets and visits to cellar doors’, he said.

‘The Australian Government’s Export and Regional Wine Support Package will provide further opportunities for wine export growth, with applications for the Wine Export Grants anticipated to open in January 2018, and the state-based and competitive grants leading to thousands more international tourists visiting our wine regions.’ 

The report highlights that ‘cellar door’ was the fastest growing sales channel with an average six per cent growth and increased investment in other attractions and facilities for visitors, which is consistent with recent consumer research by Wine Intelligence indicating a shift among winery visitors from solely wine tasting to an overall experience.

Key insights from the report include:

• production increase of 10 per cent on average, in line with the overall increase in the national vintage crush, to 106 million litres
• small winemakers account for 35 per cent of domestic sales value and 10 per cent of export sales value
• 73 per cent of small winemakers reported increased revenue, 10 per cent reported no change and 16 per cent reported a decline in sales
• the retail channel is the largest domestic channel for small winemakers, accounting for 45 per cent of wine sales on average, with cellar door sales second at 30 per cent, and
• other direct to consumer channels – such as own website, online retail through a third party and mail order/wine club – together account for 17 per cent of wine sales.