Annual financial benchmarking survey for the Australian wine industry - Vintage 2006
Welcome to the eighth annual financial benchmarking study of the Australian wine industry conducted by Deloitte in conjunction with the Winemakers’ Federation of Australia.
This survey examines the financial performance of wineries located across Australia for the 2006 vintage.
The oversupply of wine in the 2006 vintage and a relatively strong Australian dollar resulted in Australian wineries facing difficult times due to market conditions.
Current estimates of the low yielding 2007 vintage suggest there will be future pressure for the industry due to the expected rises in overhead costs per litre produced that are associated with low yield vintages.
The effects of high costs per liter may be staggered as the release of the 2007 vintage will be spread over a number of years, depending on specific
commercial circumstances such as wine variety, quality and current winery inventory levels.
The continued consolidation of retail outlets in both domestic and international markets and the ever increasing number of wine participants and wine brands has put pressure on wineries to reduce prices or increase marketing support in order to achieve sales.
It is noticeable that marketing spend has risen resulting in an increase in case sales revenue; the noticeable exception being the $20m+ category where marketing spend and case sales revenue remains flat.
Please view the attachment below for the full survey.