THE rapidly growing number of Western Australian wine producers looking offshore to lift sales is leading to a similar level of activity among the State’s wine supply sector.
THE rapidly growing number of Western Australian wine producers looking offshore to lift sales is leading to a similar level of activity among the State’s wine supply sector.
Wine exports from Western Australia have increased in value from just $A0.8 million in 1988-89 to $A56.9 million in 2003-04, with the US and the UK being the largest markets, according to the Australian Wine & Brandy Corporation (AWBC).
And with the increased move-ments of wine comes a growing demand for specialist transporters with an intimate knowledge of the product, as well as equipment such as temperature controlled facilities.
“More and more people are setting up logistic and warehousing operations in WA,” Xanadu Norman Wines Group’s Adelaide-based marketing manager, David Cumming, told WA Business News.
“They can see the increased number of boxes being moved internationally and domestically.
“You need guys who know how to pack a container with wine.”
Xanadu, one of WA’s largest exporters of wines, shipping about 100,000 cases a year, has established South Australian-based national boutique wine transporter Wine Works to transport some of its wine.
It operates temperature controlled warehousing facilities and started transporting wine from WA to destinations across the country midway through 2004.
Wine Works’ Grant Lucas, who was previously with food and liquid bulk carter Booths Transport, said growing demand for specialist wine transporters was illustrated by the moves of bigger national companies into the market.
Mr Lucas said his business was fairly small, and while WA had tremendous domestic and export potential, Wine Works was targeting controlled, organic growth.
“We don’t want to bite off any more than we can chew,” he said.
National wine player Casama Group is one of the bigger players targeting the market.
Already well established in Melbourne and Sydney, it is in the process of a national expansion and is currently establishing a $5 million greenfields operation in Perth through its national wine ware-housing and logistic arm, BAM Wine Logistics.
BAM, which stores and transports wine, recently shifted its Victorian operations into a purpose-built state-of-the-art 12,000 square metre temper-ature controlled warehouse facility in Dandenong, near Melbourne, rumoured to be worth $9.5 million.
BAM is looking to establish a similar but smaller facility in an industrial part of Perth – possibly in Kewdale due to its proximity to rail – to complement its national wine distribution service.
BAM WA group manager Rob Fanning, who recently relocated to WA from Melbourne, said market research suggested that Western Australian producers were “moderately satisfied to disgruntled” with the current level of service.
“WA wines, and not just Margaret River, are now internationally recognised and as a result we believe there are tremendous opportunities to support that industry both domestically and internationally,” Mr Fanning said. “Our contention is no-one offers a top-to-bottom service.”
In Perth, BAM is planning a large temperature controlled warehouse, a fleet of branded vehicles and sub-contractors as well as a web-based IT-inventory system.
Mr Fanning said BAM was targeting the top 15 brands in WA, and already meaningful discussions had taken place with several producers.
He said that, depending on whether a facility was purpose built or an existing warehouse could be located, the operation could be up and running within three to eight months.
Beringer Blass Global Wine Clubs & Services, which is part of the Foster’s Group, is also understood to be eyeing the WA wine distribution market.
Market speculation suggests South Australian bottling company Vinpac, a part of Beringer Blass, is investigating investment options in WA, possibly in distribution and logistics.
A spokesperson for the company said although the company was always looking at new opportunities there was nothing concrete to expand in WA at the moment.
However, he added that there was currently huge demand for Western Australian wine around Australia.
Although Vinpac is not represented in Perth, Beringer Blass controls two divisions with Perth offices – a wine home delivery service, Nexday Transport, and a packaging division, Classic Packaging.
Wine Industry Association of Western Australia John Griffiths welcomed the new business, saying while the WA market was already well serviced, more competition would be welcome.
He said the Western Australian wine market was at the higher end of the spectrum and new players looking to set up would have done their research and be targeting this type of business.
