Wine Business Expansion Strategies

This assignment analyzes a hypothetical wine company's potential global expansion into nations such as Sweden and Singapore. It emphasizes the importance of adapting their wine packaging and taste profiles to cater to the specific preferences and market demands of these countries. The analysis draws upon various academic sources that explore global wine markets, trade patterns, consumer behavior, and the influence of cultural factors on wine consumption.

Running head: GLOBAL BUSINESS OF ORGNAIC WINES OF SUNSHINE COMPANY
GLOBAL BUSINESS OF ORGANIC WINES OF SUNSHINE COMPANY
Name of the Student
Name of the University
Authors Note

1GLOBAL BUSINESS OF ORGANIC WINE OF SUNSHINE COMPANY
Table of contents
Introduction......................................................................................................................................2
Economic Environment...................................................................................................................2
Political environment and Risk........................................................................................................4
Business Environment.....................................................................................................................4
Market Potential...............................................................................................................................5
Country Choice................................................................................................................................6
Conclusion.......................................................................................................................................6
References........................................................................................................................................8

2GLOBAL BUSINESS OF ORGANIC WINE OF SUNSHINE COMPANY
Introduction
The study focuses on the product profile and its business objectives of Sunshine wine situated in
Queensland. The sunshine coast in Queensland is considered as the one of the diverse developing
wine regions in Queensland that encompasses boutique wineries as well as vineyards
manufacturing award-winning products of wine (Rossi et al. 2012). The microclimate diversity
helps to produce huge range of variety of grapes to be grown in Queensland. This attention in
Vineyards helps in producing wines that have distinctive character. The report also highlights on
the economic, political and business environment of Singapore and Sweden and their market
potential for producing wine products.
Economic Environment
The wine industry in Australia has been ranked fourth in terms of wine exports by an amount of
750 million liters to the international market with approximately 40% of wine production
consumed within the nation (Pethig 2013). This industry is a vital contributor to the total
productivity, trade and employment of this economy. The wine industry in Australia contributes
to $40.2 billion in the total output of the economy. This sector includes direct employment of
approximately 68395 people to this economy. Recent statistics reflects that the wine industry has
grown over the years in this nation.
It has been noted that variation ion business cycles influences the wine industries in Australia.
The economic environment refers to the external factors including the broader nation influences
the business environment of the wine industry. It includes both microeconomic as well as
macroeconomic environment. Microeconomic environment also influences the decision in

3GLOBAL BUSINESS OF ORGANIC WINE OF SUNSHINE COMPANY
business making that includes actions of the entities as well as the consumers while
macroeconomic environment affects the entire Australian economy and the participants of the
business. The macroeconomic factors include interest rates, taxes, currency exchange rates,
inflation rate, unemployment rate, Foreign Direct Investment (FDI) and savings rate of the
consumers. On the other hand, microeconomic environment factors involve size of the market,
demand as well as supply of wine products, rivalries and distribution chain. Therefore, economic
environment influences the success as well as failure in this wine industry in this nation.
Moreover, the size and features of the Sweden and Singapore economy, FDI inflows and trade
barriers influences the business of Sunshine wine in this nation. As recessionary phase affects
both these countries, the Sunshine wine faces difficulty in selling their wine products and
services to the customers. However, during this period, this firm cut the wages of the workers
and hence disposable income of the consumers becomes less. As a result, the consumers
purchase fewer products and this leads to decrease in sales and reduction in profitability level in
this business. In addition, inflow of FDI plays a crucial role in expansion of wine business and
hence increases the exports to these two nations. Inflow of investment improves the capital
infrastructure in the business and helps in expanding into foreign markets.
Therefore, it can be noted that sales of wine in Sweden and Singapore is affected by the wine
market of Australia. Australia has been ranked fifth as accounted by market share as the Aussie
wine value that is exported to Sweden increases to 26%. However, Sweden is known worldwide
because of organic wine consumption and is aiming to raise its sales in the upcoming years.
Australia contributes to 14% in the wine market of Singapore, as this nation is considered as the
key wine suppliers in Singapore. Thus, the economic environment in Sweden and Singapore
influences Sunshine Wine in Queensland.

4GLOBAL BUSINESS OF ORGANIC WINE OF SUNSHINE COMPANY
Political environment and Risk
The political environment in Sweden and Singapore wine business involves certain political set
of factors and other government activities in the international market. This can either aid or
hamper the business activities in the global market (Hannah et al. 2013). However, there is
certain uncertainty degree while conducting business in other nations and hence involves risk
that is often termed as sovereign risk. Some of the political factors that influence the wine
industry in Australia include the economic system, intervention of the government, tariffs,
control of trade, tax policies and restrictions of import on product quality (Ferraro and Briody
2017). Adoption of tax policies by the government of these two nations restricts the business
activities of wine companies and hence this adversely affects Australia as they are the main
exporter of wine in these countries. In addition, there is no such trade barriers for the wine
companies of Sweden and Singapore and hence this improves the economic growth of these
nations. Hence, this influences the performance of the wine business in these two nations.
Moreover, restriction of import of wine products adversely affects the revenue of wine
companies owing to decrease in sales.
Business Environment
Business Environment refers to external as well as internal factors that affect the business
activities of the organizations. The internal factors involve the strength and weakness of the wine
companies while external factors has been grouped into opportunities and threats (Chong 2014).
Singapore wine industry is relatively small with respect to Sweden wine market. The strength of
the wine companies in these two nations includes innovative wine products, attaining good
reputation by producing good quality wines, brand value, implementation of new technology for
increasing productivity. The weakness of the wine companies in these nations includes poor

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promotional activities in promoting wine products, manufacturing poor quality wine, high cost of
wine, poor distribution networks. In addition, opportunities of these companies involve
advancement of technologies, ineffective rivalries and variation in social patterns etc improves
the wine business of these two countries (Christ 2013). In addition, new entrants, rising trade
barriers and price wars between the companies poses threats to the wine entities in these two
nations. Thus, wine companies in Sweden and Singapore poses threats from other countries.
Overall the business environment of both the companies helps in expanding their business
globally and achieve the highest rank.
Market Potential
Market potential refers to total market size of the products during a particular period. It is usually
determined by volume of sales and value in the market. Australian wines have huge popularity in
Sweden and Singapore market. However, Sunshine Wine faces several challenges from other
nations in order to maintain its position in the markets of these two nations. The retailers provide
wine products to these nations according to their market demands. The wine market in Sweden
and Singapore has generated huge investment on the Sunshine exporters of this product. Though
the wine market of these two nations are dominated by other nations, Australia holds price
advantage over its competitors due to free trade agreements with these two countries. It has been
opined by (Cassi 2012) that free trade agreements increase the size of the market for a particular
product in the respective nation. Recent study also reflects that the market potential for wine of
these two nations improved during the years.

6GLOBAL BUSINESS OF ORGANIC WINE OF SUNSHINE COMPANY
Country Choice
Wine market in Singapore is considerable smaller as compared to wine market in Sweden.
Although the wine sector in Singapore has grown over the years, the size of the wine market
expanded in Sweden. The reason behind the expansion in Sweden wine market is the increase in
sales of organic wine over the last ten years. In addition, Swedish wine industry has a monopoly
market structure and hence the retailer’s benefits in this market structures by setting the price
owing to increase in demand. Sweden wine companies purchases Australia’s exported wine
according to the needs and preferences of the customers. Thus , the total sale of wine in this
country increases during the period 2006 to 2016 and thus leading to expansion of wine market
in Sweden (Anderson and Nelgen 2015). Moreover, it creates huge opportunities to the entities
that includes introduction of internet wine shops. On the contrary, free trade agreements throw
little positive effect in the Singaporean wine industry. As stated by (), Singaporean wine sector
will expand in upcoming years owing to increase in demand for red wine. Weighted index refers
to market value index in which the components are weighted based on the company’s market
value of their shares. As the wine companies in Sweden has shown huge sales of organic wine
for the past few years, their market share value is high as compared to Singaporean wine
companies. Thus, Sweden wine market is chosen over the Singaporean market owing to high
market value of the shares of their companies.
Conclusion
From the above assignment it can be concluded that Sunshine Wine in Queensland contributes to
Australia’s GDP growth and reduces the unemployment in the country. Additionally, as they are
main exporters of wine in Sweden and Singapore, this company attains huge profit in terms of
trade. Moreover, it is recommended that the Sunshine Wine Queensland must focus on their

7GLOBAL BUSINESS OF ORGANIC WINE OF SUNSHINE COMPANY
marketing strategies and free trade agreements with other nations in order to expand their
business in other nations. As a consultant, it can be suggested that this company must focus on
their wine packaging and taste according to the market demand of other nations including
Sweden and Singapore.

8GLOBAL BUSINESS OF ORGANIC WINE OF SUNSHINE COMPANY
References
Anderson, K. and Nelgen, S., 2015. Global wine markets, 1961 to 2009: a statistical
compendium (p. 468). University of Adelaide Press.
Cassi, L., Morrison, A. and Ter Wal, A.L., 2012. The evolution of trade and scientific
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9GLOBAL BUSINESS OF ORGANIC WINE OF SUNSHINE COMPANY
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