According to a new report, South Australian wineries are addressing the impacts of the past two years with innovation, new product development and market diversification.

The annual South Australian Wine Industry Snapshot report interviewed 116 South Australian wineries researching how the wineries are working to counter the effects COVID-19 which has led to limited labour availability and of the China wine duties which have seen a 77 per cent decline in exports to the nation, dropping in value from $1.2b to $274 million.

The report found that the wineries are working to increase:

  • market penetration
  • improving profit margins
  • geographic expansion
  • new product development and
  • market diversification.

As well as product and market diversification, wine businesses are investing more heavily in innovation and new technology, and upskilling in marketing planning, e-commerce and social media to reach more customers via DTC channels.

“Wine businesses are looking at the diversification and innovation of their products, as well as targeting new demographics and new markets to overcome the increased domestic competition and the loss of the China market," says SAWIA Chief Executive, Brian Smedley.

“While the Government has been able to secure new trade deals with the UK, there needs to be continued industry support through these trying times to safeguard the future of markets. Challenges include a shortage of skilled workers, an impact that must be addressed.”

The impacts of China are expected to be felt for the next five years

Bentleys South Australia conducted the survey and Partner Tim Siebert said, “Understanding the impact of market changes will allow decision makers to understand both the profit, cashflow and long-term business impact. This will enable the evolution of strategic plans and business forecasts."

Wine businesses can read the full report at Bentleys.com.au.

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