Direct wine-to-consumer business Naked Wines has announced a $5million rescue fund to help Australian independent winemakers who’ve been hit by China’s punitive wine tariffs.
The company has called on winemakers, retailers and consumers to unite to ‘Stop the Squeeze’ on Australia’s independent winemaking community.
Alicia Kennedy (below), Managing Director of Naked Wines Australia, said around 15% of Naked Wines’ local independent winemakers – associated industries such as growers and bottlers – would be affected by China’s tariff hikes.
“With the China tariffs story quickly developing, we are hearing first-hand from Naked’s community – and other winemakers around Australia – about the potentially crippling challenges they are facing,” Kennedy said. “Australia’s independent winemakers have been caught between a rock and a hard place with the sudden tariff hikes of up to 212% on top of an already tough year. The reality is that winemakers reliant on traditional channels are going to suffer the most over the next 12 to 18 months.”
“For the smaller winemakers and grape growers, there’s a lot of fear and uncertainty around their future; they have committed to vintage and invested upfront, and they’re understandably very concerned they’ll be driven to the wall by retailers dropping or bartering down their contracts to take advantage of cheaper sources. Unfortunately for some, this is already happening.
“Unlike the bigger winemakers, many of Australia’s independent winemakers don’t have the balance sheets needed to pay the tariffs or to hold their wine in storage for future years when there will be less flowback supply into the market. This will place deflationary pressure on the prices of their grapes and wine – taking advantage of their vulnerability and leaving them holding wine and fruit from dropped contracts and commitments.
“There is a very real danger that many local winemakers will become collateral damage in this situation and be left without a leg to stand on. As an industry and as a nation, we need to band together now to ‘Stop the Squeeze’ on Australia’s wonderful community of independent winemakers – a large portion of whom exist in heartland regional Australia,” Kennedy said.
The move to support independent winemakers follows Naked Wines enjoying huge growth in the first half of the new financial year, with local revenue up 48% on the same period of FY20, and 80% up as a global group. The sales increase was largely driven by customer acquisition and retention, with a global customer base of over 750,000, 95% of which create repeat sales for the business.
Pictured above: Jen Pfeiffer ‘RockItLikeARedhead’ at Pfeiffer Wines in Wahgunyah, Victoria. ‘RockItLikeARedhead’ wines are sold exclusively through Naked Wines.
To apply to the Naked Wines relief fund, winemakers can go to www.nakedwines.com.au/stopthesqueeze.