"A year ago, we were working towards reclaiming lost ground after a slight dip in sales in 2006. Now our position is far stronger," said Su Birch, CEO of Wines of South Africa (WOSA) that promotes South African wines generically worldwide "We not only have FirstCape, Kumala and Namaqua within the UK's top 20 retail sellers, but we have other brands showing solid growth and across a growing range of price points."
She said response to the South African wine exhibits at the recent London Wine Trade Fair indicated continued broad-based trade support for the South African category. "We accentuated our competitive difference by using a series of regional stands, strikingly and innovatively designed with map-based graphics to highlight our varied regions and underscore our "variety is in our nature" positioning.
Birch confirmed that reports of new business concluded by South African producers participating on this show had been very encouraging.
While sales to Germany were 11% up for the first four months of 2008 compared to a year ago, growth had been strongest in bulk exports, with many retailers electing to bottle at market destination rather than source. "We are employing a range of initiatives to build awareness of our packaged offerings. We are now the number one New World producer in this market, and already enjoy a prominent presence. Both Nederburg and Golden Kaan are brand leaders here.
Birch added that packaged wines recorded impressive growth between January and April, in Denmark, up 38%,Canada, 26% and Belgium, 17%. UK, its biggest export market, recorded a growth of 26%.
The domestic producers have been able to take full advantage of shortage of Australina wines for export as well as their weaker currency. "Although exports were up in total across bottled and bulk sales by 43% for the first four months, this must be viewed in the context of reduced output and much less price promotional activity from a drought-stricken Australia. Local producers have been able to make the most of the opportunities created by this situation, as well as the weak Rand. However, such dramatic growth is not sustainable and as a country, we are better served by strengthening long-term relationships, building brands and focusing on protecting margins," adds Su Birch who has been to India a few times in order to promote SA wines in India.
Exports to India are also on the increase. Though the correct figures cannot be ascertained, based on the feedback from various importers, the increase is more than 20%, which due to the small base is not exceptional. Brands like Springfield, Two Oceans, Nederburg, Rupert Rothschild, Graham Beck, and Wilderkrans are well established. A few new brands are in the pipeline. Generally the acceptance of South African wines has been quite good but the actual penetration has not been up to the expectation of the South African producers. |