Wineries

Wineries

Brief Excerpt from Industry Overview Chapter:

Companies in this industry make wine and brandies either from grapes that they grow or that are grown elsewhere. Major companies include Constellation Brands, E&J Gallo, and Jackson Family Wines (all based in the US), Veuve Clicquot Ponsard (France), Distell Group (South Africa), Gruppo Italiano Vini (Italy), and Viña Concha y Toro (Chile).

Major wine-producing nations include France, Italy, and Spain, followed by the US, Argentina, Australia, and Germany, according to the Wine Institute. Among top producers, Australia, Argentina, and the US saw the highest rates of growth between 2007 and 2010. Expanding markets and evolving consumer tastes could help global wine sales rise at a 3 percent compound annual growth rate from 2010-2015, according to Euromonitor.

The US wineries industry includes about 1,800 companies with combined annual revenue of more than $14 billion and is forecast to grow at a low rate over the next two years. The industry is heavily dependent upon consumer entertainment and leisure spending as well as climate conditions for grape production. US companies also face tough competition from imported wines from around the world.

COMPETITIVE LANDSCAPE

Demand for wine is driven by the restaurant and hotel industries, the level of business entertainment spending, and consumer income. A winery's profitability depends on production volume and sales price, both of which can vary from year to year. Large companies have stronger distribution channels and can enjoy significant economies of scale in production. Small wineries can...