Australia

Contrary to opinion, WA wines can break into China’s vast market

By RJ Whitehead

- Last updated on GMT

Photo: iStock
Photo: iStock

Related tags Wine

A common belief that Western Australian wine volumes are not big enough to make any significant inroads into the Chinese market is incorrect, and the state’s wineries are in fact well placed to claim a portion of growing demand.

However, to capitalise on China’s potential, producers must consider certain key factors when exporting their wine, according to a report which looks at 26 wine producers across all WA wine regions.

There is a perception that WA’s wine production volume is too small to make any significant penetration into the Chinese market​,” said Jeremy Galbreath, of the Bankwest Curtin Economics Centre.

Our research, however, determined that there was a definitive market for premium wine in China and that WA was well poised to meet a slice of that demand, providing wine producers consider a few key aspects when exporting their wine​.”

Successful exporters must be creative around labels, colouring and wine descriptors, while investigating the value of creating new wine brands to target the Chinese market, he said.

They should also be aware of Chinese cultural ideologies with respect to colour when designing packing and developing their products, and realise how brand messages will be understood by the Chinese market.

The importance of precise marketing and branding of Western Australian wines was also highlighted as the impact of WA’s isolation presented additional challenges.

Outside of some knowledgeable wine consumers, even regions like Margaret River have little global recognition. This needs to change in order for Western Australian wine producers to successfully increase exports to China​,” said Associate Professor Galbreath.

Several participants in the research expressed that regional producers should investigate more thoroughly how they can collaborate or cooperate to increase the volume of their exports to China​.

This would help overcome some concerns about too many small producers acting alone, encouraging participation towards a common goal, and keeping individual brands intact​.”

China’s market is especially important for WA wine producers which, as the majority struggle to find profits, need to develop new business models at a time when the Australian dollar at its lowest point in years.

The time to develop partnerships with foreign investors is immediate​,” said Prof. Galbeath.

As there are an estimated 20,000 wine importers in China, the industry really needs to sort out who the best importers and distributors are for WA wine​.”

Otherwise, he said, many producers will spend far too much time and money trying to gain access to this massive market. Without trusted and focused distribution, frustration and failure is likely.

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