from cottage to global… challenges and opportunities facing australian wine companies
DESCRIPTION
From Cottage to Global… Challenges and Opportunities facing Australian Wine Companies. James Lovell, Vice-President Global Supply Chain Planning 2006 ABARE Conference 2 March 2006. Cottage – Global…. 19932005 Number of Wineries8021,900 Major Wineries (>100k ton)36 - PowerPoint PPT PresentationTRANSCRIPT
From Cottage to Global… Challenges and Opportunities facing Australian Wine Companies
James Lovell, Vice-President Global Supply Chain Planning2006 ABARE Conference2 March 2006
CONSUMER LED & CUSTOMER
DRIVEN
Cottage – Global…
1993 2005Number of Wineries 802 1,900Major Wineries (>100k ton) 3 6Annual Crush (tonnes) 621,000 1.86 milArea Under Vine (hectares) 69,500 160,600Domestic Sales (ML) 311.6ML 417.4MLExport Sales (ML) 103.2ML 643.2ML
Source: The Australian Wine Industry Directory 1993, 2005
CONSUMER LED & CUSTOMER
DRIVEN
Area Under Vine
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
1881
1891
1901
1911
1921
1931
1941
1951
1961
1971
1981
1991
2001
2005Source: Vintage: The Australian Wine Industry Statistical Yearbook 2002
Hectares
CONSUMER LED & CUSTOMER
DRIVEN
Beverage Wine Production
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1923
1933
1941
1951
1961
1971
1981
1991
2001
2005
Unfortified Fortified
Source: Vintage: The Australian Wine Industry Statistical Yearbook 2002
CONSUMER LED & CUSTOMER
DRIVEN
2004 Share of Production
Chardonnay18%Other White
25%
Other Red12%
Multipurpose4%
Shiraz24%
Cabernet Sauvignon
17%
Varietal Mix
Source: Vintage: Australian Wine & Brandy Corporation
1982 Share of Production
Chardonnay1%
Other White40%
Other Red16%
Multipurpose24%
Shiraz13%
Cabernet Sauvignon
6%
CONSUMER LED & CUSTOMER
DRIVEN
Introduction
Leadership Drives Change
Evolution Takes Time
Opportunities and ChallengesSUCCESS!
Then… Now…
CONSUMER LED & CUSTOMER
DRIVEN
Future opportunityOversupplyExport market
growthOversupplyDomestic Market Growth
A Global Wine Business19851985 20052005
Australian Production Growth
Advantages Realised
Scale economics in wine manufacturing and packaging
Scale economies in component purchase
Specialist and technical expertise
Challenges Overcome
Manufacturing facility consolidation
Organisational complexity and process – from generalists to specialists
Systems and Technology implementation
(Acquisition integration)
CONSUMER LED & CUSTOMER
DRIVEN
Future opportunityOversupplyExport market
growthOversupplyDomestic Market Growth
A Global Wine Business19851985 20052005
Australian Production Growth
Export Sales and Marketing Functions
Advantages Realised
Scale economies to support in-market sales and marketing teams and away from agency and distributor relationships
-Direct control over the relationship with customers-Marketing teams in the market-Increasing share of business with powerful customers
Challenges OvercomeEstablishing self contained businesses (team, systems ect)
Australian team – Market team coordination and cultural challenges
Cross-geography communication and process
CONSUMER LED & CUSTOMER
DRIVEN
Future opportunityOversupplyExport market
growthOversupplyDomestic Market Growth
A Global Wine Business19851985 20052005
Australian Production Growth
Export Sales and Marketing Department
Global Supply Chain
Advantages RealisedIncreasing segment portfolio breadth and increased customer relevanceReduced business risk of a diverse, multi-country sourcing platformFurther scale to support in-market sales and marketing functionsGlobally leveraged supply chain expertise and economics
Challenges OvercomeCultural barriers and organisational integrationComplexity, complexity, complexity – and the planning systems and operational structures to manageGlobal supply chain implementation
CONSUMER LED & CUSTOMER
DRIVEN
Future opportunityOversupplyExport market
growthOversupplyDomestic Market Growth
A Global Wine Business19851985 20052005
Australian Production Growth
Export Sales and Marketing Department
Global Supply Chain
The Future – Winning the Wine Game
Advantages RealisedMulti-beverage route to market – sales/marketing scale and market powerBack-end integration with customers – VMI, service effectiveness and business insightBolt-on routes to market and further production sourcing options
Challenges Overcome
Cultural barriers and organisational integration, againStandardising systems and process to benchmark FMCGRetaining flexibility and responsiveness(Acquisition Integration)
CONSUMER LED & CUSTOMER
DRIVEN
Our Business Model
Foster’s AustraliaFoster’s NZFWE Asia
Foster’s WineEstates Americas
FGL WineEstates EMEA
Branding Innovation Supply Chain
California Chile Italy France Australia New Zealand
In market scale, reach
CommonGlobal system
Multi-countrysourcing
1
2
3
Flexibility and the discipline to manage a complex global network will enable us to reach our scale goals
Global Wine Business NetworkSupply Chain/Marketing/Innovation
From Cottage to Global… Challenges and Opportunities facing Australian Wine Companies
James Lovell, Vice-President Global Supply Chain Planning2006 ABARE Conference2 March 2006