Wineries can free up cash by working together, says Finlaysons Wine Partner, Will Taylor.
It has been very widely reported that conditions are extremely tough in the Australian wine sector at present.
“Cash is oxygen,” says Taylor, “and in the wine sector the air has become highly rarified.”
Therefore, obviously wineries need to save every penny.
A way of generating extra cash is for wineries to collaborate to find some synergies and realise some savings.
Mr Taylor says there is a lot of inefficiency, duplication of functions and under-utilisation of resources in the Australian wine sector.
Normally, the available synergies are only realised when there is a full merger of businesses.
However, that doesn’t have to be the case if people are smart about it.
“Wineries need to think about how they can create savings by sharing resources, such as plant and equipment and people, and what functions can be combined, such as ‘back office’ administration, for example,” Taylor says.
The collaboration can be relatively informal when you are just sharing some equipment with your neighbour, rather than each buying your own.
On the other hand, more substantial collaboration might involve more formal arrangements such as joint ventures, partnerships or even partial or full mergers.
“This sounds obvious, but nowhere near enough of it appears to be happening,” Mr Taylor says.
“A significant part of the problem is that winemakers tend to be quality-focused, ‘control freaks’, which is understandable, but some compromise might be essential if you want to survive in the current environment.”
These ideas and more will be discussed at Finlaysons Wine Roadshow 34, which will focus on assisting wineries to navigate these tough economic conditions and come out the other side as stronger businesses.
The seminar series is entitled “Save Every Drop” this year.
Finlaysons Wine Roadshow
Hobart – Monday 3 August
Yarra Valley – Tuesday 4 August
Rutherglen – Wednesday 5 August
Riverina – Thursday 6 August
Hunter Valley – Friday 7 August
Barossa – Monday 10 August
McLaren Vale – Tuesday 11 August
Riverland – Monday 17 August
Limestone Coast – Monday 14 September
Margaret River – Monday 30 November
Finlaysons will be accompanied on the road again by Australian Grape & Wine, Wine Australia and KPMG.
Click https://www.finlaysons.com.au/wrs34/ for more information or to register.
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