The Business Plan a Winery in the Swan Valley Region
The wine industry in Australia is demarcated by wine regions that are located in different parts of the country. Each of the wine regions has numerous wineries that clients visit to purchase wine products or tour the facilities. The wine regions have distinctive features that attract foreign and domestic visitors. Thus, the establishment of a winery in this region would be a strategic business venture, as it will have high demand. Furthermore, the Winemakers’ Federation of Australia ensures that wine producers obtain maximum profits under good working conditions. A primary concern lies in the selection of a wine region. This paper has recommended starting the winery in Swan Valley region due to various factors.
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First of all, the region is located in Western Australia that receives over two million domestic visitors and seven hundred thousand foreign visitors annually. The area is also close to the central business district that makes it easy for clients to traverse. The proposed winery will position itself as high quality, strong brand, cost-effective, entertaining, impeccable customer service, with informed staff, innovative, and sustainable. Swan Valley region currently has approximately forty wineries. This number is optimum, as it is not immensely high or low. Competition in a given industry is good for starting businesses, as it leads to a situation when quality attracts the clients. Thus, when a new company incorporates quality in its products, it will compete favorably with the existing businesses. This fact is the underlying notion of starting a winery in the region. The winery will have a favorable design that will reduce the operational costs to allow the firm to attain its cost-effective approach. For instance, the winery will have big windows that permit penetration of natural sunlight, thereby reducing energy cost. LED lighting will be used, as it does not release heat which would necessitate cooling that consumes a considerable amount of energy. Finally, the winery will use an integrated marketing approach that is comprised of advertising, public relations, word of mouth, online marketing, and product placement.
This paper aims to evaluate a wine region that would be strategic to start a winery. The business plan is aimed at launching a winery in Swan Valley region. The rationale for this business idea is significant sales that will be obtained from diverse target markets. The report will help establish the viability of starting the winery in the selected region. Currently, there are many wineries in the chosen wine region. Nonetheless, a considerable number of competitors could be beneficial for the new businesses, as it would create a situation when clients are attracted by quality and service.
Wine Region Analysis
This section evaluates the wine industry in Australia and Swan Valley region in particular where the winery will be started. The section also includes a competitor analysis. Finally, it will comprise a PEST analysis of Australia to establish the viability of the proposed winery.
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Australia has a vibrant wine market that is evidenced by the numerous wineries and massive exports. For instance, in 2016, the profit obtained from wine exports totaled two billion dollars (Wells, 2007). There are over two thousand four hundred firms that sell wine in the country. Many couples drink wine to celebrate special occasions in their lives such as anniversaries of their relationship whereas families drink wine to celebrate such occasions as the birth of their children. Therefore, a winery is a viable business undertaking that will have a high return on investment.
There are approximately sixty wine regions in the country. Each of the regions has numerous wineries that clients from different parts of the country can visit. Consequently, it is important for the winery to adopt a strategic plan to ensure that it attains a competitive edge in the industry. The Winemakers’ Federation of Australia (WFA) is the organization responsible for regulating the wine industry in the country (Wells, 2007). This organization is accountable for the formulation of policies and collaboration with pertinent stakeholders such as the government to protect the members. For instance, the organization negotiates the taxes on exports that the federal government places on wine makers. WFA aims to assist its members to attain sustainable and international benchmarked profitability.
Swan Valley is situated in Western Australia. This region is strategic, as it receives approximately two point eight million domestic visitors and seven hundred thousand foreign visitors annually. This large population will provide an adequate market for the winery. Whiteman Park that is located in the region has many museums that have numerous artifacts that intrigue visitors. The Caversham Park that is also found in the area has over 2000 different animals (Madden, 2017). In this park, guests are permitted to feed the kangaroos. This region has the largest chocolate factory. Visitors are allowed in the facility to see the chocolate making process. In addition, the visitors are provided with hand-crafted beers. There are numerous sophisticated galleries where customers can watch performances that give them the possibility to learn about the country’s culture.
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Swan Valley is a short distance away from Perth CBD. Thus, visitors can easily access the region. Moreover, the region has an excellent infrastructure, with over twenty operators offering tours to clients that want to visit the region (Madden, 2017). For example, Ugly Duckling is the major cellar door in the area.
The main competitor of the region is Margaret River. The reason is that this region is also located in Western Australia. It is approximately two hundred kilometers away from Swan Valley and three hours away from the central business district. Margaret River has one hundred and twenty wineries which is way more than the wineries found in Swan Valley (Latimer, 2017). The competitive region permits behind the scenes tour for the customers to see the wine production process. The region has various attractive features, including surfing, kayaking, dirt adventures, and mountain biking. The region has many more adventures, as compared to Swan valley particularly in November when the Gourmet escape is held.
Political. Swan Valley and Margaret River are both located in Western Australia. Consequently, they comply with a similar set of legislations established by the federal government. None of the regions has a competitive advantage from a political perspective. The government has dictated fair policies in the region which ensures that the two regions obtain and retain employees (Burrow & Bosiljevac, 2012). What is more, the government has established an excellent infrastructure that facilitates the movement of goods and services in the region. The nation is a democracy that has a stable system. Thus, the country benefits from a substantial amount of foreign direct investment (FDI). All the income derived from FDI is used to improve the infrastructure of the region.
Economic. The major driver of the economy in the region is the service sector. The country has a skilled population that adequately fulfills the labor required in the country. Since 2010, the economy has exhibited a steady growth and has, thus, attracted a high level of investor confidence (Kotler & Armstrong, 2012). The strong economy coupled with high employment triggers high citizen spending.
Social. Australia has a populace of more than two million individuals. People are friendly, which encourages international tourists to visit the country. There are various cultures peacefully coexisting in the area. Importantly, all people from different cultures have a fair chance of accessing social facilities. Notably, immigrants from developing countries are treated well and are encouraged to participate in capacity building and training to improve their skill set. Furthermore, the nation has many restaurants where clients can indulge in diverse delicacies. The quality of life in the region is amongst the best in the world. As a result, many individuals around the world visit the country. In addition, there are excellent social support services for diverse groups of people in the country. Australia is in the same time zone with the majority of other regions (Madden, 2017). This fact makes it easy for the business to coordinate with other firms located in different geographical locations.
Technological. The region is a developed nation with appropriate technology that has facilitated business operations. Both software and hardware are used in enhancing business. For instance, the internet allows companies to provide their products via websites. Thus, customers can pay using online schemes and have the products delivered to their homes. Technology is used to monitor the production process of various commodities, thereby ensuring that they are produced on time and with no defects (Doyle, 2008). Thus, the technology in the region has substantially increased efficiency and reduced operational costs. In addition, technology assists in intensifying the marketing activities of the country.
Overview of Concept and Positioning of Winery
The winery will provide quality products and services to the clients. Sourcing fresh farm produce will attain this outcome from farmers (Burrow & Bosiljevac, 2012). Furthermore, the winery will collaborate with the farmers to ensure that the agricultural produce is in optimum condition. The winery will provide refrigeration facilities for the farmers to store their products once they are harvested. Moreover, refrigerated automobiles will be utilized to transport the raw materials from the farmhouses to the processing amenities. By doing so, the winery will assure excellent quality.
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Furthermore, the winery will develop its brand to attract customers. This action will be achieved by engaging in CSR activities that support the local community (Kotler & Armstrong, 2012). When people see that the winery cares about the society, they will be motivated to purchase its products and services. A strong brand will complement the marketing strategy, as will create a situation when the clients want to be associated with the firm (Baker, 2014). Thus, this positioning will complement the marketing strategies adopted by the winery.
The winery will price its products slightly lower than other wineries in the region. This cost-effective approach will allow it to attain a competitive edge since cost is the primary consideration for customers that are making purchasing decisions (Challagalla, Murtha, & Jaworski, 2014). The winery will manage to do this by increasing the efficiency of internal and external operations that will, in turn, lower the operational costs (Doyle, 2008). Consequently, the winery will be in a position to price the products lower and still obtain a good profit margin. Nonetheless, all products will be sold to people above the legal age.
The winery will gain double advantages as an entertainment joint. All the visitors will be entertained at concerts by different artists. The entertainment provided will be diverse to attract different target markets. For example, there will be gymnastic performances for children and love songs for couples. Additionally, the winery will offer impeccable customer service. In fact, this will guarantee high levels of client satisfaction. Satisfied clients will be happy with the firm and will, thus, practice repeat purchasing behavior (Burrow & Bosiljevac, 2012). They will also help the company succeed in word of mouth marketing. Customer service will be achieved by obtaining hospitable staff in the recruitment process. The hiring process will carefully evaluate the candidates and ensure that they match the requirements of the job.
High standards of hygiene will also be guaranteed at the winery. Specifically, the production facilities will employ acute measures that will make sure the clients are provided with clean products. All visitors that tour the production will be provided with clothing gear that will ensure they do not compromise the hygiene of the facility (Wells, 2007). The farm produce will be sanitized and stored in clean equipment. Moreover, the cellar door will be maintained in clean conditions, meaning they will be washed every day. The winery will have knowledgeable staff that will be in a position to advise the customers on new wines that they should try. Informed staff enables the firm to attain a competitive edge (Hastings, 2012). Furthermore, the employees will talk about wine production and other related topics with the clients that visit the facility. By doing so, the clients will be happy with the service of the employees and will, thus, revisit the winery.
Furthermore, the winery will provide ample security for all guests and their properties during their visit. Several security guards will keep watch of the client’s cars and ensure that they are not damaged (Burrow & Bosiljevac, 2012). The children of the clients will also be taken care of by qualified staff to ensure they do not harm themselves.
The winery will provide new products to ensure that it obtains new customers. In addition, new products will make sure that the existing customers are not bored with the current products. Often, customers want to try new products (Khalaf Alharthey, 2013). Therefore, the winery will gain substantial benefits from the market for new products.
Sustainable operations will be utilized to ensure that the winery complies with the regulations set by the government, while simultaneously attracting many customers. Today, consumers are increasingly conscious of the effect of business processes on the environment (Wells, 2007). The reason is that the impact on the environment also affects their health. Thus, customers will support businesses that embrace sustainable operations.
The four kinds of wine will be produced using red and white grapes. The winery will ensure that the berry size and barrel aging aspects are efficiently managed to prevent variation in the wine. Hand and machine will be used to harvest the grapes. The different types of wine will be processed using prescribed procedures that provide optimum quality (Wells, 2007). The equipment employed in the production of wine will be thoroughly sanitized. The wine will be allowed to age properly before being sold to the customers. The construction of the winery will permit proper drainage. Furthermore, sulfite will be incorporated to preserve the wine and avert unsolicited fermentation.
The winery will have spacious rooms that will store the equipment used in wine production. Additionally, the lighting will be strategically placed and complemented with big open windows to reduce energy cost. There will be gazebo structures that permit the clients to drink and talk in privacy. Adequate ventilation will be present in all rooms. Glass walls will be used to allow the clients to see all the different wines produced. Moreover, there will be temperature and humidity controllers installed in the chambers. Barrels will be placed underground to remove the requirement of cooling.
Visitors will be provided with aerators, cork screw, and suitable glasses. Aperitifs will be served first, followed by the major wine and finally the dessert wines. The customers will be allowed to tour the facility and learn about the wine production process. Fast service will be provided to allow busy clients to purchase the wines and proceed to other functions (Burrow & Bosiljevac, 2012). Furthermore, the staff will engage in enthusiastic conversations with the visitors.
Proposed Cellar Door
The cellar door will have a vertical orientation that will permit modest viewing of the wine bottles. The cellar door will have an enormous space to stock all the bottles. Stable support will be ensured by the use of mahogany wood. The doors will be shielded to enforce security. Importantly, a wine wheel will be used to allow the customers to view all the bottles (Madden, 2017). Additionally, all the wine bottles will be branded correctly. Big windows will be used to permit natural sunlight. This action will lower the electricity cost. A conveyer belt will be used to pass clean glasses to the customers to test the wine. Air conditioning facilities will be installed to control the temperature. Moreover, cellar cabinets will be constructed to provide additional protection for the expensive wines. All the furniture used will be polished by satin to protect it from rusting. LED lighting will be used, as it does not release heat so that the room will not require cooling. A water fountain will be fitted to control the humidity of the room. A swimming pool and gallery will be included to provide additional entertainment for the guests.
The visitors will be informed on the criterion for establishing the quality of the wine. Customers will be provided with lighter wines before they are given heavier ones. Similarly, dry wines will be provided before sweet wines. All wines produced at the winery will be available. Importantly, wine tasting will be charged a small fee contingent on the kind of wine. However, the costs charged on wine tasting will be low to motivate the guests to try different wines. If a visitor that tasted and paid for wine buys a bottle of wine, they will be reimbursed. Playing facilities will be provided for the children. The staff will be trained to ensure they adopt practices such as proper storage to preserve wine (Kotler & Armstrong, 2012). The staff will provide prompt service at the cellar door.
Proposed Target Markets
The target market will comprise families, couples, visitors, and corporate customers. Families targeted will be ones that have young children who accompany their parents to all places. Thus, the families will mainly be of parents below the age of thirty-five years old. The families will provide a market for wine products and children playing facilities. With regard to couples, they love spending time together doing fun things (Doyle, 2008). The winery will provide an avenue for them to engage in these actions. Moreover, couples drink wine to celebrate various occasions in their lives. Thus, the winery will have a good market for its products. Visitors include both domestic and foreign visitors that come to the region. Talking about corporate clients, they require places to hold meetings and conduct training (Klapdor, 2013). They have adequate capital to buy products in bulk.
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Proposed Food Options
The winery will provide different types of food to complement the wines. The foods include roasted and grilled poultry, sushi, blue vein cheese, veal, fatty fish, pizza, Pasta Filata cheese, pork, and Chinese and Italian dishes.
The winery will employ five different marketing strategies that include advertising, word of mouth, product placement, online marketing, and public relations.
Advertising will be conducted by placing advertisements on mainstream and print media. Moreover, social media sites will place advertisements for the winery. User-generated content will be used in advertising since it relates well with the customers (Burrow & Bosiljevac, 2012). Billboards will be positioned tactically on zones that have immense traffic. By doing so, many motorists and pedestrians will become cognizant of the winery.
This technique will be used in movies, and video games will also be utilized. The rationale for this approach is the substantial number of people that play games which is now more than the number of people watching television. This marketing reaches the audience as they cannot skip channels, which is often the case in TV advertisements (Doyle, 2008). Product placement will aid in developing the brand of the winery.
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Word of Mouth
The staff will be instructed to employ the use of word of mouth marketing. The reason behind this is that this marketing strategy reaches a wide audience at a low cost (Burrow & Bosiljevac, 2012). A platform will be developed where the customers can talk about their experience. Clients that share the winery on the different social sites will be eligible for discounts on their next purchases.
PR will be utilized by disseminating information on all the sustainable measures implemented by the business. By doing so, the clients will be motivated to purchase the products of the company (Onkvisit & Shaw, 2012). Furthermore, the firm will address all the customers’ queries, suggestions, and complaints adequately. Excellent service will be provided for the clients to ensure that there is no negative publicity which is costly and time-consuming to correct (Doyle, 2008). Big data analytics will be used to collect data that will be analyzed to identify the changing preferences and trends.
Swan Valley is a strategic location to instigate the winery. The region receives numerous domestic and international visitors that will provide a market for the products. The country has a stable system of government which implies that there is high stakeholder confidence. The government will provide set policies that will allow the winery to flourish. Since Australia is a developed country with high employment, the residents have adequate disposable income to spend on wine. This fact is particularly important, as wine is a luxury need that is bought by people with good incomes. The winery will have a good architecture and design that will reduce operational costs and attract clients. The target market of the firm will be comprised of families, couples, visitors, and corporate customers. An integrated marketing strategy that includes online marketing, public relations, online marketing, word of mouth, and advertising will be employed to attract new clients.