SWOT Analysis of Australian Big Four Wine Companies

The assignment involves conducting a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis of four leading Australian wine companies. The report focuses on the strategies adopted by these companies to expand their operations globally, including export growth, market development, merger and joint ventures, and foreign direct investment. The summary also includes references from relevant books and journals in international marketing and business.

INTERNATIONAL
MARKETING

Table of Contents
INTRODUCTION ..........................................................................................................................1
QUESTION 1. SWOT Analysis of Australian Big Four Wine Company.......................................1
TIMELINE .................................................................................................................................3
SWOT Analysis of Australian Wine Industry............................................................................4
BIG FOUR Expansion Strategies Worldwide:..........................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8
.........................................................................................................................................................9

INTRODUCTION
SWOT Analysis refers to various internal and external factor that affects the future
performance of business enterprise. SWOT stands for Strength, Weakness, Opportunity and
Threat. This technique focuses on maintaining the balance between micro resources and
competency of an organisation and macro threats. It helps to identify various approaches adopted
by firm to develop peculiar business model according to the accessible resources and capabilities
of the company. It represents both positive and negative aspect that affects the business
operation. This assignment covers the SWOT Analysis of Australian Big Four Wine Industry
depicts their strategies that, they adopted in order top expand its business all across the globe.
QUESTION 1. SWOT Analysis of Australian Big Four Wine Company
Australian Big Four Wine Company consist of Beringer Blass, Orlando-Wyndham, BRL
Hardy and Southcorp. From the last 15 years, Australian wine company has hold a major share
of international market on the basis of product range, technological innovation, consistent quality
and reasonable pricing. Following company's have been supported by Australian Wine Export
Council which provides them adequate funds for their industry collaboration. Apart from this,
cited organisation have also faced various challenges in order to become the major exporter of
wine industry such as reduce dependency on UK market and diversification in their UK market.
BERINGER BLASS
 Merger between Wolf Blass and Mildara in 1991.
 Acquired by Foster's Brewing Group.
 Has developed three-channel strategy consists of specialist wine packaging operation,
maintaining its traditional channels and acquisition of wine clubs.
 Announced Joint Venture with Vina Sanata in 1997.
 In 2000, Foster acquired Californian Company Beringer Wine Estates to strengthen the
operations and functions of Beringer and Mildara Blass.
 Also, abet the distribution of Mildara Brass brand in the US market.
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ORLANDO WYNDHAM
 Obtain two other Australian industry Wyndham and Orlando in 1990.
 Following acquisition make Pernod fisrt “New World Investment” Industry.
 Aiming at building single product brand Jacob's Creek.
 Adding countries such as Chile, China, Argentina and South Africa to their supply
chain.
 Focus on Escalating their distribution in the region of Asia.
SOUTHCORP
 Joint Venture of Penfolds and Lindemans.
 Focusing on to diversify its market share by eliminating the interference of UK Market.
 Aim to set up industry in the Languedoc region of France.
 Main objective is to become world's leading manufacturer of branded wine industry.
 Declared 50/50 Joint Venture with Robert Mondavi.
 Also acquired Rosemount which adds high value to its product.
BRL HARDY
 Merger of two big companies Thomas Hardy and Beri Renmano.
 Enlarge its supply chain by procuring current autonomous distributors.
 Focusing on building its channel in Continental Europe.
 Joint venture with, Casa Vinicola Calatrasi(Italy) and Sicilian company with an idea of
launching its first Italian wine world wide.
 Another Joint venture with Australian Constellations Brands and Languedoc-Roussillon
region of France in order to reinforce the supply of their product in US market.
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TIMELINE
In 1980:  Pernod joint venture with Orlando and
Wyndham
In 1989-90:  Pernod holds a major share in European
market of wine and liquor.
 Southcorp signed number of ventures
for its expansion.
In 1991:  Mildara Blass joint venture with Wolf
Blass and Mildara.
In 1992:  BRL was formed by the joint venture
and Thomas Hardy procure the
Languedoc-Roussillon region of
France.
In 1993:  Orlando Wyndham aims at building
single brand, Jacob's Creek.
In 1995:  Blass acquire Foster’s Brewing Group
in order to diversify its product.
In 1997:  Blass declared merger with with a
Chilean wine manufacturer, Vina
Sanata Carolina
 Southcorp has bough grapes land in
California in order to expand its
business along with current product.
In 2000:  Foster procure California Industry in
order to build up the operations of
Mildara Blass and Beringer.
 Souhcorp has increased their sales up-
to $400 million by supplying its
product across 80 countries.
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In 2001:  BRL merged with Constellations
Brands in order to increase its
distribution channel in the market of
US.
 BRL made a proposal with Kendall-
Jackson to generate its operations in
US market but it proves to be
unsuccessful.
SWOT Analysis of Australian Wine Industry
SWOT Analysis refers to the matrix which shows strength, weakness, opportunities and
threats of the organisation. It is a strategic tool used to determine the impact of internal and
external factors on its business operations. It enables the firm to match their capabilities with the
limited resources in an effective and efficient way. Basically it evaluate the financial position of
the company or where it stands. By knowing its threats and opportunities, company can improve
their operations. Strength and Weakness enables the firm to know what specialised skills and
knowledge they possess which gives them competitive advantage over their rivals and from
opportunities and threats, industry can find out how they can grow and expand their business.
Strength of Australian Big Four Wine Industry :
 The vital strength of the following industry are stable quality, technological invention,
depth range of products, rational pricing and optimum financial resources.
 They generally aim on expanding their business by exporting its product all across the
globe. Thus become large exporter of wine products that deals globally.
 Cited Company was supported by the Australian Wine Export Council which provide
adequate funding to the Australian Wine Industry for its industry collaboration.
 Company generally don't face any issue related with adapting the culture of Australia as
there was moderate psychic distance between both countries UK and Australia.
 Australian Big Four wine industry is having strong competitive advantage as well as
market position against their rivals.
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 They adopted the strategy of diversification in order to expand their business activities at
different location and moreover to take the advantage of other prime country's which
gives them fierce edge.
Weakness of Australian Big Four Wine Industry:
 The major drawback of all the following countries are they are highly dependent on UK
for its operations.
 They are grappling to diversify its product across the globe.
 Following Companies are more focused towards the production process rather than the
marketing. For instance Germans was unaware of Australian wine.
 Bid made by BRL Hardy was proves to be unsuccessful in order to expand its operations
in market of US.
 Complex distribution channel in US Market which creates ambiguity among the
following companies.
 Another major challenge which was faced by Big Four was in terms of transforming
themselves from exporters to worldwide producers.
Opportunities of Australian Big Four Wine Industry:
 Main opportunities for the following company are in context of their market expansion
all across the globe.
 Moreover, the psychic distance between two countries are low which proves to be an
opportunity for the entire industry in order to expand its business activities in the area of
UK.
 Domestic competition within the country was low.
 US comes out as the most profitable wine industry market.
 Wine consumption is constantly increasing.
 Procurement of production and various distribution channel.
 Build “New Brand Portfolio” which enables the company to produce wines in different
countries such as South Africa, Chile, China and Argentina.
Threats of Australian Big Four Wine Industry:
 High dependency on UK market.
 Low awareness among Germans about the UK wine.
 Moderate wine consumption in japan.
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 Companies are criticised for only focusing on production rather than marketing.
 Other leading company's all across the globe considering BLR Hardy, Foster and
Southcorp as their takeover targets.
 Australia is facing inelastic competition from different countries such as Chile, South-
Africa, Europe and Argentina.
BIG FOUR Expansion Strategies Worldwide:
ORLANDO
WYNDHAM
BERINGER BLASS BRL HARDY SOUTHCORP
 Develop New
Single Brand
Portfolio for
increasing their
supply chain.
 Focused on the
development of
Jacob's Creek.
 Focuses on
three channel
distribution
 Acquire wine
clubs and wine
packaging
operations.
 Hold in various
supply chain
companies.
 Merge with
two big firms
in order to
procure the
interest of its
autonomic
distribution.
 Adopted
sourcing
strategy.
 Purchase land
in order to
expand its
product line.
 Acquire
production
various
countries in
order to expand
business
strategy locally
and globally.
◦
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CONCLUSION
From the above SWOT Analysis of Australian Big Four Wine Company it has been
proved that all the following four company has adopted same strategies in order to expand their
operations globally. However, all cited company develop themselves from export to joint venture
or FDI. In 1980s, all above industry are focusing on its export growth, later in 1990s , they
focused on market development and in 2000, they become the global operators through merger
and joint venture. Also all the company's aiming same in context of transforming themselves into
global producers, reducing the interference level of UK market, lower operational risk. All the
cited company has adopted market expansion strategy in order to enter into other foreign markets
where they can expand its business operations. Also they haves faces major shift from export to
alliance and foreign direct investment. Thus, it can be concluded that all organisation have opted
same strategy in order to expand globally.
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REFERENCES
Books and Journals
Cavusgil, S. T. and Cavusgil, E., 2012. Reflections on international marketing: destructive
regeneration and multinational firms. Journal of the Academy of Marketing Science.
40(2). pp.202-217.
Chung, H. F., Lu Wang, C. and Huang, P. H., 2012. A contingency approach to international
marketing strategy and decision-making structure among exporting firms. International
Marketing Review. 29(1). pp.54-87.
Czinkota, M. R. and Ronkainen, I. A., 2013. International marketing. Cengage Learning.
Fletcher, R. and Crawford, H., 2013. International marketing: an Asia-Pacific perspective.
Pearson Higher Education AU.
Griffin, R. W. and Pustay, M. W., 2012. International business. Pearson Higher Ed.
Papadopoulos, N. and Heslop, L. A., 2014. Product-country images: Impact and role in
international marketing. Routledge.
Zhou, L., Wu, A. and Barnes, B. R., 2012. The effects of early internationalization on
performance outcomes in young international ventures: the mediating role of marketing
capabilities. Journal of International Marketing. 20(4). pp.25-45.
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