10 - Factors that Affect the Price of Wine Flashcards
What are the two categories that determine production costs?
grape growing and winemaking
what is the highest production cost? what are options to keep this cost down?
labor (usually)
to keep cost down - by relying on seasonal, casual workforce or mechanisation. and by sharing labor or machines with other growers.
What are the most obvious costs involved in winemaking?
equipping and maintaining the winery with the necessary equipment.
Why does the amount of time a wine needs to be kept before release factor into costs?
storage facilities can be expensive to maintain and this means money is tied up in stock that can’t be sold right away to generate a profit. this factors into the sale price
Why is the cost of getting a wine to market so significant for most producers?
Because they seek to sell their wine further afield and producers have to rely on other businesses to transport and distribute their wines.
What are the 3 main types of wine producers?
Co-operatives: wine businesses owned by their members (grape growers). Growers give grapes to co-op (therefore they are guaranteed a buyer). The winemaking team employed by the co-op makes the wine. they do not have complete control over grapes supplied. Very common system in Europe because average vineyard holding for grower in Europe is too small for them to profitably produce and market their own wine
Merchant: merchants buy grapes, juice or wine from growers or co-ops. Common outside of Europe where grape growers have large holdings.
Estate: business that makes wine only fro grapes that they grow. wine produced on small scale. these producers are often responsible for best wines because producer has greatest amount of control in the production process. however they can have fwer blending options which is a problem in years where there are poor growing conditions. these wines also referred to as domaine.
