In 2008 the Continental EU bought NZ$40 million of New Zealand wine, roughly one quarter of what the United Kingdom bought. Most of the continental Europe sales went to countries without domestic production such as ones in the Benelux and Scandinavian regions.
Overall EU wine consumption is falling steadily, but sales of quality wines had been increasing (though this was before the current economic downturn). In the 10 years to 2008 imports of quality wines grew an average of 10 percent a year.
The industry faces a variety of challenges including:
- the downturn in the global economy
- rising concerns about sustainability
- health and wellness
- over indulgence and binge drinking
- ever more information being crammed onto labels.
Getting your product into market
Sauvignon Blanc has been New Zealand’s entry card internationally. It is well established in the United Kingdom but less so on the Continent. Wineries would often be expected to lead with a Sauvignon Blanc. Pinot Noir has also been making significant headway recently.
The size of the winery, and its sales goal, will determine whether to favour a retail or food service strategy. Retailers usually offer greater volumes quickly but at a lower margin than food service. Food service favours the limited volume winery.
Regulations
Countries outside the EU face import duties.
All wines must comply with EU winemaking regulations and be certified by the Wine Export Certification Service. Exports of wines, including sweet ones, with a potential alcohol content higher than 15 percent are prohibited.
New Zealand wine is not subject to EU quota.
Opportunities
- Markets like Russia, the third largest wine market in Europe, with increasing wealth and with limited domestic wine producing capability, hold great potential.
- Grove Mill saw its sales rocket in the United Kingdom after it secured carbon neutral classification. The Continent is not yet as far down the sustainability path as the United Kingdom but it is going in the same direction.
Challenges
- Sustainability is a very significant issue that needs to be considered.
