Non-traditional markets beckon wine exporters

The true value of South African wines has yet to be unlocked internationally, says new chairman of Wines of South Africa (Wosa), renowned businessman Michael Jordaan. “Not by a long shot has this happened,” he told FTW. “While we have achieved considerable success in traditional markets, there is huge potential in the USA, Far East and Africa. The reality is that in some markets we are not considered as a well-known wine producing country. But where we have a presence, we are known to produce consistent, high-quality wines.” When it comes to wine, says Jordaan, consistency, quality and professionalism are very important values. Jordaan’s creative thinking and capacity to see opportunity seems to be just what the doctor ordered for the local wine industry which has been hard at work trying to reach and establish itself in new markets while keeping its traditional buyers happy. The South African wine industry has seen strong yearon- year growth – so much so that in 2013 volumes sold reached a record high of 525.7 million litres, a 26% increase on the previous high achieved in 2012. And this was all attributed to the efforts made to grow both new and traditional markets. “Although our traditional markets have indeed been under pressure due to the recession, most economies have been recovering well over the last year or two,” says Jordaan. “These markets remain important for us and as producers and marketers, we need to maintain our attention and support. Many of these markets are related to inbound tourism as well, so it’s important for tourists to be able to have access to SA wines once they’ve returned from their visit here and essentially have become converted ambassadors.” However, says Jordaan, it is just as important to explore other markets. “Ten years ago almost half of our exports went into the UK – last year it was 22% of the total. While the UK is still a very good market and has recovered well after the recession, it is not the only market to focus on.” The challenge for South Africa, says Jordaan, is realising that there is not a silver bullet or recipe for all. “Markets differ hugely, even in one single country, for example the USA and mainland China, including Hong Kong. When a new market is considered, the exporter must do sufficient market research, set in place a solid, focused strategy and business plan – and have patience,” he says. “It is also important to understand cultural complexities and the market structure/route to market. Continuous visits to the market are important, as well as the business partner (agent/ distributor) on that side. In a complex market like the US, it is important to focus on fewer regions and not all the states. Don’t risk spreading yourself too thin.” INSERT & CAPTION Markets differ hugely, even in one single country, for example the USA and mainland China, including Hong Kong. – Michael Jordaan