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Send  Share  RSS  Twitter  14 Jul 2010

FOOD & BEVERAGES: Waka Waka Local Wines


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While pundits continue to calculate the material value of South Africa’s hosting of the 2010 World Cup, one of the sectors to have derived a tangible benefit has been the wine industry, with packaged exports still on the rise, despite the continued strength of the rand and the protraction of the worldwide recession.

According to Wines of South Africa (WOSA) CEO Su Birch, for the most part there has been a marked increase in sales volumes amongst those countries with a high level of interest in soccer.

For the six months to the end of June, the volumes of packaged wines exported to Germany rose by an impressive 50%.  To the US, which interestingly bought more tickets to attend the games than any other foreign country, exports increased 32% for the period. Canada, Finland and Belgium all showed double-digit volume growth.  So did the Republic of Ireland, a country particularly hard hit by the downturn. 

Other exciting developments have been a 33% growth to Japan, and a more than doubling of sales to both the United Arab Emirates (UAE) and China, albeit off a smaller base. Even to competitor countries such as France, New Zealand and Australia, sales were up.”

Distell’s Nederburg, South Africa’s only wine brand licensed to carry the official FIFA logo and which produced a trio of wines to mark South Africa’s hosting of the games, also reported strong sales growth in many of the countries with fervent football fans.  Some of the highlights, said Carina Gous, Distell’s group general manager: wines, were Germany, the UK, Ireland, the Netherlands, Belgium, Canada, the UAE, Brazil and Mexico. Her company is hoping that exposure to the brand and to South African wines in general, will result in a longer-term benefit for the local wine industry.

Birch said the impact of the games had not only been confined to sales abroad. Some producers had reported excellent domestic sales too. Vinimark, the country’s largest independent specialty wine wholesaler, representing many leading names in local wine, had reported double-digit growth in sales directed to the local hospitality sector, when compared with the same period a year ago.  This was at a time when the industry worldwide had seen a significant fall-off in sales through licensed establishments. Groot Constantia’s sales had risen by 10% in June this year, compared with June 2009, and the trend for July was looking even better for the historic estate. Similarly, Warwick Estate in Stellenbosch had experienced a 58% increase in domestic sales in June.

Warwick’s Mike Ratcliffe said whereas last year exports accounted for 60% of sales during June and July, and the domestic market 40%, the ratios had been reversed this year with the strong influx of soccer-related visitors to the Cape.

Birch believed the tournament had brought many intangible benefits, such as the raised visibility for South Africa and its wines and the likely increase in tourism to the Cape that would in all probability translate into future growth in wine exports. 

The growing awareness of the country is seeding opportunities for the local wine industry in countries such as Japan, China, Korea, where knowledge of South Africa as a wine-producing country is still in its infancy. We are starting to see the impact already. Michaela Stander, WOSA’s marketing manager whose portfolio includes Asia, was met with immediate recognition of South Africa and some of our wines when recently conducting tastings in the region.

Cape Town Tourism has projected that with some three billion people having watched the televised broadcast of the games, if just 0,5% of those spectators were to visit Cape Town over the next five years, the city’s current international annual visitor traffic would grow from 1,8 million to 4,8 million people.  This would obviously have favourable repercussions for the wine and hospitality industries.”

Birch confirmed that WOSA was continuing to capitalise on the raised international awareness of South Africa. “The cacophony of the vuvuzelas may be over but we are still training wine waiters to support the local hospitality industry until the end of this year.  In addition, the finals of our Sommelier World Cup, involving 12 nations from Europe, North America and Korea, will be held in the Cape in October.

We want more consumers to purchase the country’s offerings not just from retail shelves but from wine lists.  The Sommelier World Cup is targeting that highly influential group of people who serve as the gateway to diners.”

The finalists would spend a week at the Cape and be exposed to the industry first-hand, meeting with producers and restaurateurs, she said.  “This initiative will undoubtedly help to build respect and loyalty for South Africa as a wine producer of an exciting and diverse range of quality wines across the pricing spectrum.”

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