1 Factors that affect the price of a bottle of wine Flashcards
What are the factors that influence the price of a bottle of wine?
The costs of growing the grapes
producing the wine
getting it to the end consumer
supply and demand
What happened in 2013 in Castilla-La Mancha?
uncommonly high spring and summer rainfall in the usually arid Castilla-La Mancha increased
the volume of wine produced in Spain to 45.3 million hectolitres
How was the growing season in 2017 Europe?
spring frosts in much of Europe produced the lowest global volume production for 50 years, but Spain’s production in this year was 32.5 million hectolitres.
Why do producers lower their prices?
when supply of a particular product exceeds demand, prices tend to fall as consumers have a greater choice of cheaper alternatives. Producers may therefore need to lower their prices (so reducing their profits) to remain competitive
What may happens if the demand exceeds supply?
when demand exceeds supply, prices are likely to increase. While consumers may be willing to pay higher prices for some wines (generally if they perceive that there are no alternatives available), for other wines consumers may not be willing to pay more and may simply switch to another wine or a different drink category altogether.
What is the main factor that influence demand for wine?
Demand will be affected by changes in the habits and preferences of wine drinkers
Global wine consumption increased in the first part of the 2000s. True or False?
True
Global wine consumption began to fall back from 2008 because of
the global financial crisis of 2008 as many consumers reduced their spending on non-essential products
The popularity of certain categories, such as —– and ——, has increased significantly in the last decade.
rosé and sparkling wine
Sparkling wine consumption has increased an average of —– per cent annually between 2002 to 2018.
3
In 2011, ——— overtook France and Italy to become the country with the largest wine
consumption worldwide.
the USA
Why in the last 20–30 years, has wine drinking increasingly become part of mainstream culture in the USA?
1- increasing globalisation of the food and
drinks industry (growth of multi-national corporations,
2- increased ability of companies to export
products across national borders,
3- consumers more able and willing to embrace new tastes) as well as
4- both increases and improvements in wine production in the domestic market.
Why has wine consumption in China increased
China has a growing middle class and one way this group can show their improved wealth
and status is by moving from local drinks (with the possible exception of top quality products)
to wine.
Consumption figures appear to have declined slightly in China over the last two years, because:
1- perhaps signaling the end of a period of rapid growth.
2- lower estimated wine production figures in 2019, will have played a part in the estimated consumption figure for 2019
What are the possible reasons for the decrease in wine consumption?
1- Younger people drinking less wine
2- Health concerns
3- Changes in lifesyle
4- Reduced availability of cheap wine
5- Changing consumer preferences
6- Changes in reputation
7- Changes in spending patterns
8- economic factors
9- Strength of the economy
10- Fluctuation in currency exchange
11- Change to the market
12- Legislative and political factors
13- Laws prohibiting or limiting the sale of alcohol
14- Government policies to reduce alcohol consumption
15- Taxation
16- International Trade
17- Wine laws
Why are younger people drinking less wine?
1- they regard wine as old-fashioned – something their parents or grandparents drank 2- they have turned to other
alcoholic drinks (for example, gin is very fashionable amongst younger drinkers in Spain). 3- In countries such as the UK, younger people are also spending less time in bars, preferring to
contact their friends via social media.
What impact do health-related government campaigns and policies, such as the Loi Evin in France, have on wine consumption, particularly among younger drinkers?
Increasing awareness of the negative health effects of alcohol is thought to have contributed to a significant drop in wine consumption.
How change of lifestyle affects wine consumption?
Busy, modern lifestyles mean that there is often less time for longer meals at which wine was traditionally drunk. Also, in many countries where there was a tradition of drinking wine at lunchtime, consuming alcohol during the working day is being increasingly forbidden by employers or not being regarded as socially acceptable.
How vine pull scheme affects wine consumption?
Reduced availability of cheap wine and instead of buying more expensive wine, some consumers have simply switched to other, cheaper alcoholic or non-alcoholic drinks.
