Globalisation Essay

1257 Words Sep 24th, 2012 6 Pages
Corporate Capers

Unless you’re an avid reader of the Financial Review the changes in the Australian wine industry might have passed you by. In recent years Australian wine companies have spread their wings and come of age on the world stage. Companies have expanded and increased their brand portfolio, as well as aligning themselves with other international companies. Takeovers have been rife; in fact with foreign ownership on the increase, it might well be high time for Dick Smith to start bottling Chardonnay!

The big four wine companies in Australia are: Southcorp, Beringer Blass, BRL Hardy and Orlando Wyndham. Each company has grown in the past five years on the back of the continued success of Australian wine in the major overseas
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What does it really mean?

Globalisation is all about increasing the links amongst organisations around the world to the mutual benefit of all concerned. With record harvests being achieved each year and with even more grapes available from 2003, when record new plantings from 1999 begin to come on-line, our major wine companies have been busy sourcing global distribution channels.

Strategic alliances are a key part of the globalisation game in the new millennium. Southcorp have recently signed an agreement with Suntory, the largest beverage supplier in Japan to sell their Lindemans range of wines. BRL Hardy have set up a company (Pacific Wine Partners) with the US firm Constellation Brands to sell to the US market and, through the business, have purchased the Californian Blackstone Wine Company for a mere $290 million.

Smaller medium sized companies are determined not to be left out of the game. Australian family owned Mc Williams Wines, who also owns Barwang, Brand’s of Coonawarra and Lillydale, have formed a strategic alliance with E&J Gallo who are America’s, and one of the world’s, largest wine companies to sell their Hanwood wine range. “ We had done a similar distribution deal with Jim Beam and our Barwang brand in 1997 and, whilst Gallo were in Australia, we talked and found we were on the same wavelengths” comments McWilliams CEO Kevin McLintock. “ They have a great infrastructure and are excellent distributors”.

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