The South African wine industry is in the process of developing a new strategic framework aiming to improve competitiveness and coherence through, inter alia, more focused communication and an industry-wide governance structure.
The South African wine industry has achieved substantial growth within the past 20 years since Democracy. Exports have, for example increased exponentially from 50 million litres in 1994 to more than 500 million litres by the end of 2013. “We have found 450 million litres of market space for our wines; this is a fantastic story!” explains Rico Basson, managing director of VinPro, the representative organisation for wine producers and cellars, which facilitates the process.
According to Basson, the industry is now ready for its next growth curve. “Currently the South African wine industry is still fragmented in its nature. In order to be more globally competitive, an industrywide effort needed to be launched that will have to address issues such as technology, production capacity, quality of our South African product, transformation and access to global markets. We need to use the same hymn sheet.”
This sparked the launch of the Wine Industry Strategic Exercise, which according to Basson, will be based on a value-chain approach, incorporating production, processing and marketing of wine. Following the initial buy-in from industry representatives, a strategic framework will be formulated over the next few months with proposed roll-out by the end of 2014.
A group of stakeholders from various segments of the wine industry, organisations and business units, as well as academia, convened during an initial session in January, where six key strategic objectives were identified.
The process then involved performing an assessment of both the various strategies and plans that have been developed for the wine industry over the years – including Vision 2020, Foresight and the National Development Plan. “These strategies were not necessarily futile, but were on the one hand perhaps too progressive for its time, or on the other hand did not achieve the desired implementation or buy-in from stakeholders,” said Basson.
Following participation from producers, cellars and other wine industry stakeholders in the form of a questionnaire, a task team met for a two-day workshop in June 2014 to agree on key principles and strategic objectives. These strategic objectives will be further deliberated in different work streams to design an implementation framework and report back to the task team. The framework will also need to be aligned with the priorities as identified in the initial survey.
“The eventual implementation of the strategic framework needs to be institutionalised – it needs to be linked to a budget and obtain buy-in from policymakers,” says Basson. Interaction between Government, the industry (producers) and labour will be key in achieving the six objectives set out by the Wine Industry Strategic Exercise. The involvement of Government is especially crucial, given the strong focus of the framework on, inter alia, job creation, increasing foreign exchange earnings and infrastructure development.
“Progress and outcomes of the new roadmap will be communicated continuously,” said. Basson.
Wine Industry Strategic Framework
1. Economic empowerment and development
2. Market development and promotion (working more collectively)
3. Social development and upliftment
4. Knowledge and information development
5. Technology innovation and transfer
6. HR development and training