This report is an industry study of the Australian wine industry, from the viewpoint of winemakers. It identifies serious structural problems in the industry which has little or no harmony between grapegrowers and winemakers, or among different sized wineries.
Marketing strategies are proposed to resolve industry fragmentation which is a fundamental cause of many problems. These problems include: grape over-supply, retail price discounting, potential flood of imported wine and low growth in per capita consumption.
Marketing expertise is identifies as the greatest weakness of production orientated wine producers who generally produce wine from high-yielding grapes, regardless of whether such varieties are in demand by consumers.
Industry rationalisation is almost certain in the near future and current profitability levels are low. Australia does produce high quality premium wines but export opportunities are not a panacea as there is a world-wide oversupply of wine, partly due to increased consumer awareness of the danger of alcohol excess.