Small winemakers see strong growth underpinned by cellar door sales
Market Bulletin | Issue 41
Small winemaking businesses saw an average increase of 12 per cent in wine sales revenue in 2015-16, according to Wine Australia’s Small Winemaker Production and Sales Survey 2016 results released today. This segment of the wine sector is estimated to have generated $1 billion in wine sales in the 2015–16 financial year.
Wineries that produce 35,001–70,000 litres (approximately 4000–8000 cases) saw the highest average revenue growth (up 16 per cent).
The survey also found that production was up across all size categories, with the highest average growth in wineries that produce 70,001–170,000 litres (approximately 8000–20,000 cases) or 170,000 - 350,000 litres (both up 11 per cent).
Australia’s small winemakers sell most of their wine on the domestic market, with 88 per cent of wine on average sold domestically. Increasing winery size was correlated with an increasing reliance on exports (see chart). For wineries producing more than 170,000 litres (20,000–44,000 cases), exports accounted for 27 per cent of sales.
The major source of income was retailers and wholesalers, which generated 47 per cent of income. However, cellar doors have become increasingly important sales channels, accounting for 27 per cent of revenue and showing the strongest growth on average across all winery size categories.
Two-thirds of small winemakers have a cellar door, nearly half (48 per cent) make all their wine in their own facilities, and many offer a diverse range of other services including on-site restaurants, cafes, tours and boutique accommodation. These businesses employ an average of five people each.
Wine Australia surveyed Australian small wine businesses with an estimated crush of up to 500 tonnes (approximately 350,000 litres or 40,000 cases). The responses from this survey will feed into the annual Production, Sales and Inventory Survey currently underway that will provide an overall state of play on Australian supply and demand. These results will be published in early 2017.