Wine & Brandy industry information

The South African wine and brandy industry developed the need for a comprehensive, industry-wide strategic exercise that will help it to reach a desirable future state by 2025. This entails a robust and adaptable approach to drive profitability, global competitiveness and sustainability.

WHO?

For the purpose of this project, the “wine industry” includes the total value-chain of the brandy and distillates sector, the grape-based products sector such as wine and juice, as well as other secondary but complimentary sources of income, such as wine tourism. The value-chain stretches from consumer needs to marketing, packing and distribution, winemaking, cellar practice, viticulture practice, as well as terroir and plant material selection. Underlying all aspects of the value-chain are logistics, technology, institutional and political framework and labour and communities.

WISE is driven by:

VinPro:Representative organisation for 3 500 wine producers and cellars.
Salba:South African Liquor Brandowners Association, representing 22 wholesale manufacturers and distributors of liquor.
Sawis:SA Wine Industry Information and Systems, the business unit tasked with managing statistics and the Wine of Origin Scheme.
Wosa:Wines of South Africa, the business unit responsible for generic export promotion
Winetech: Wine Industry Network of Expertise and Technology, the business unit coordinating research and development.
A WISE Task Team was compiled with representatives from the above industry bodies, as well as a range of role-players throughout the wine and brandy value-chain. Wider consultation in the industry formed a crucial part in the process.

The Task Team consists of:

Facilitators: The industry core team
  • Bowen Botha – Robertson Winery
  • Neville Carew – Origin Wines
  • Daniël vd Heever – Namaqua Wines
  • Phillip Retief – Van Loveren Wines
  • Jacques Naudé – First Cape Wines
  • Petrus Bosman – Bosman Vineyards
  • Erhard Wolf – Distell
  • John Barnardt – Bonnievale Wines
  • Anton Smuts – Producer
  • Christo Conradie – VinPro
  • Siobhan Thompson – WOSA
  • Yvette vd Merwe – SAWIS
  • Gerard Martin – Winetech
  • Kurt Moore – SALBA
  • Johan Giliomee – VinPro
  • Edo Heyns – VinPro
  • Rico Basson – VinPro
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TIMELINE

May 2014:Baseline literature review – see review
May 2014:Survey to identify key drivers – see survey results
Jun 2014:Organise work streams to investigate each area of study
Nov 2014:Identify projects from work streams and develop terms of reference for each
Nov 2014:Appoint implementation agents for each project
Nov 2014 – Aug 2015:Monitor project roll-out
Aug 2015:Allocate key initiatives to industry role-players
Nov 2015:Extracting game changers and finalising projects
Jan 2016:The Wise Way Forward - see document
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TARGETS

 

OUTCOMES

6 WORK STREAMS:

Following an analysis of all relevant literature and feedback from the wine and brandy industry, the WISE Task Team identified 6 main themes, or work streams, which cover key aspects for development. Industry stakeholders were appointed onto work streams and tasked to investigate their specific area in terms of current state in the industry, as well as the future ideal.

THE WORK STREAMS ARE:

    1
  • Economic empowerment & development

    Economic development and growth, while broadening the participation of historically disadvantaged individuals.

  • 2
  • Human resource development & training

    Promoting the development of human capacity, establishing positive workplace relations and image, and addressing backlogs in the supply of skilled workers.

  • 3
  • Knowledge & information development

    Providing trusted and accurate market information, which will support product quality and integrity, and assist in strategic decision-making at industry level.

  • 4
  • Market development & promotion

    Promoting Brand South Africa, providing promotion and market and business development services, encouraging socially responsible alcohol consumption and establishing linkages between the wine industry and tourism.

  • 5
  • Social development & upliftment

    Ensuring that all role-players, including historically disadvantaged individuals, have the social and organisational capacity to make a constructive contribution to the industry and South Africa as a whole.

  • 6
  • Technology innovation & transfer

    Creating a technology innovation model for the wine industry. This includes facilitating the development of technology and transfer systems that are market-oriented and socially and environmentally responsible.

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10 PROJECTS

10 projects were identified to address the 6 work streams. A terms of reference, or structure, was developed for each project and implementation agents appointed. These included external service providers, as well as individuals within current industry organisations such as VinPro and SAWIS. The 10 projects were repackaged into 4 toolbox items that create an enabling environment for business as usual, and 6 game changers, which are new projects that are expected to change the industry’s landscape.

TOOLBOX: CREATING AN ENABLING ENVIRONMENT FOR BUSINESS AS USUAL

1.Single South African information portal and search engine

Objective: The SA wine industry is served by a number of different information systems, databases and libraries. It has become apparent, however, that there will be great value in combining these into one single portal in order to be more accessible and better utilised. There is also a need to incorporate in this portal new electronic services and databases that may be identified as value adding. This project is aimed at the development of such a centralised portal and search engine.

Project leader: Yvette van der Merwe | E-mail: yvette@sawis.co.za

Research:

  • Refer to outcomes.

Outcomes:

Organisation/body driving the project: SAWIS

2.Price point analysis of supply chain – packaged and bulk

Objective: The wine industry needs to understand the South African supply of wine as well as the supply from their 10 greatest competitor countries in terms of the following: how are price points established and what kind of pressures would warrant a lowering of prices? The focus of this project therefore is to build an understanding of value chain elasticity in order to better drive prices of SA products in the future. The project can be subdivided into two sections: a look at SA supply in terms of price points, as well as international supply – in particular SA’s 10 greatest competitors.

Project leader: Erhard Wolf | Email: ewolf@distell.co.za  

Research:

  • Presentation at WISE Task Team Meeting – 4 August 2015

Outcomes:

Organisation/body driving the project: VinPro

3.Implementation plan for learning and development in the wine value chain

Objective: The development of human capital will play a significant role in improving the sustainability, competitiveness and robustness of the wine industry going forward. PricewaterhouseCoopers (PwC) has prepared a Learning & Development Strategy for the industry, which makes a number of recommendations. The aim of this specific WISE project is to implement the most essential of those recommendations and create an enabling environment for the other recommendations to also be addressed within the structures created. The Plan includes an integrated Learning Management System for the industry and is linked with the targets for skills development included in the Transformation Plan.

Project leader: Phil Bowes | E-mail: phil@vinpro.co.za | Service provider: PwC

Research:

  • Learning and Development Strategy – PricewaterhouseCoopers (PwC)

Outcomes:

Organisation/body driving the project: VinPro

4.Realignment of research and development structures

Objective: The purpose of this review is to determine the value and relevance of existing research and development structures in order to initiate constructive change. This change will include to develop a robust research and development strategy, technology tools and solutions that facilitate decision-making, develop networks and forums of collaborative expertise, develop a new business model for industry and fund research and education programmes for top academics and technologists in the industry.

Project leader: Gerard Martin | E-mail: marting@winetech.co.za

Research:

  • Winetech Operational Review – Ian Dean, July 2014

Outcomes:

    Organisation/body driving the project: Winetech

    GAME CHANGERS: CHANGING THE WINE & BRANDY INDUSTRY'S LANDSCAPE

    5.Analysis of market and consumer trends in key markets and formalising global trade agenda

    Objective: The objective of this project was to build a customised model for market opportunities for South African Wine, explore up to 5 individual markets in more depth and support the dissemination of insight to stakeholders. The markets that are being focused on thus far include China, Africa (Angola and Nigeria) and the USA. This complements the generic export promotion body Wines of South Africa's (Wosa) strategic framework.

    The project also includes the analysis of non-tariff barriers, as well as setting the trade agenda for Government engagement in key markets. Closer collaboration with various Government departments will be crucial.  

    Project leader: Yvette van der Merwe | E-mail: yvette@sawis.co.za | Service provider: Wine Intelligence and Tralac

    Organisation/body driving the project: WOSA  and SAWIS

    6.Wine tourism baseline study and strategy development

    Objective: The objective of this project is to:

    • Build an understanding of current wine tourism industry
    • Make projections as to where the industry wants to go
    • Develop a strategy for wine tourism to move from the “as is” to the “to be” state.

    Project leader: Siobhan Thompson | E-mail: sthompson@wosa.co.za | Service provider: Destinate

    Organisation/body driving the project: WOSA

    7.Brand South Africa local marketing strategy

    Objective: The objective is to re-energise and revitalize the local wine market by:

    • Raising the status of the category within the broader alcohol repertoire;
    • Building new customer target groups – creating a lifestyle choice;
    • Making wine more "accessible" to consumers;
    • Taking greater share of the local alcohol beverage market;
    • Improving profitability and driving entrepreneurship

    Project leader: Siobhan Thompson | E-mail: sthompson@wosa.co.za | Service provider: The Moss Group

    Research:

    Research completed by The Moss Group:
    • Alcoholic trends baseline report
    • CIA NOW platform
    • Global Best practice
    • Retailer engagement

    Outcomes:

  • Terms of reference
  • Phase 1 Final Presentation
  • Alcoholic Trends Report
  • Brand SA local marketing strategy (1)
  • Brand SA local marketing strategy (2)
  • Organisation/body driving the project: WOSA

    8.Land reform & transformation plan

    Objective: The objective of this project is to:

    • Conduct desktop research on compliance levels of wine value chain players;
    • Compile comprehensive transformation plan for wine value chain, indicating intent, quantifying timelines and targets.

    Project leader: Phil Bowes | E-mail: phil@vinpro.co.za | Service provider: Agrifusion

    Research:

    • Desktop research – internal exercise by VinPro
    • Developing Transformation Plan – VinPro with assistance by Agrifusion

    Outcomes:

  • Terms of reference
  • Strategy
  • Organisation/body driving the project: VinPro

    9.Technology transfer and innovation strategy for the wine value chain

    Objective: This project is aimed at assessing the current state of technology and innovation usage through a SWOT analysis, plotting the ideal future state on a ten year horizon; and providing a road map to reach this future state.

    Project leader: Gerard Martin | E-mail: marting@winetech.co.za | Service Provider: Ian Dean

    Research:

    Technology strategy and road map, by Ian Dean (August 2015), supported by:
    • Report GWRDC-StrategicPlan-web.pdf
    • Report MGI Urban Map Econ Power Largest Cities.pdf
    • Strategy Chile Wine Industry 2020.pdf

    Outcomes:

  • Terms of reference
  • Progress Report - April 2015
  • Technology Strategy - 2015 Final Report
  • Appendix B
  • Appendix C
  • Appendix D
  • Appendix E
  • Appendix F
  • Appendix G
  • Appendices H and I
  • Organisation/body driving the project: Winetech

    10.Wine social compact

    Objective: A social compact is an agreement amongst the members of an organised society or between the people and the government, which covers a specific topic. The compact has the right to secure mutual protection and welfare or to regulate the relations among members. Because the agreement is a contract, each party to the contract is granted certain rights, but also bears certain responsibilities. In the case of the Wine Social Compact the parties involved are Industry, Government, Labour and Civil Society.

    Project leader: Rico Basson | Email: rico@vinpro.co.za | Service provider: Agrifusion

    Research:

    • Labour and the development of a social compact for the wine industry in South Africa – Adrian Sayers
    • Builds on National Development Plan (NDP), Agricultural Policy Action Plan (APAP), Land Reform policy, AgriBEE Sector Code, Laborie agreement, etc.

    Outcomes:

  • Terms of reference
  • Organisation/body driving the project: VinPro

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