Wines & Vines

September 2011 Winery & Vineyard Economics Issue

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$20+ -5% 0% 5% 10% Domestic Wine Sales Up 9% Retail growth rate in July rivals China's GDP Relative Growth by Price Segment Domestic Wine $15-$19.99 $11-$14.99 $8-$10.99 $5-$7.99 $3.50-$4.99 <$3.50 $20+ -5% 0% 5% 10% 15% Percent growth by dollars, 52 weeks ending July 10, 2011, at major food and drug stores omestic wine sales in July grew nearly as fast as the economy of China, reaching $347 million, ac- cording to check stand scan data from major U.S. food and drug stores. The four-week growth rate for wine was 9.1% higher than the same period last year, nearly matching China's 9.5% growth in GDP for the second quarter. Every four-week period in the 17 months since Wines & Vines began ana- lyzing sales data from the Symphony IRI Group, a Chicago-based market research firm, has shown positive growth in do- mestic wine sales. The pace ticked along at about 6% every month from early 2010 until early this year. But March hit 8% growth, May hit 10%, and now the 12-week growth rate has reached 9% over last year with rounding. D Imported 22% Domestic 78% Dollar share, 52 weeks ending July 10, 2011, at major food and drug stores. Phenomenal rate Growth has remained fastest in the high- est priced category that SIRI measures— wines priced at $20 and higher. Sales in that category reached $14 million for the four weeks ending July 10, representing 32% growth in dollars over the same four weeks in 2010. The 52-week growth for these high-ticket wines was 22%. The largest dollar category of domestic table wines includes those retailing for $5-$7.99 per 750ml bottle. This category sold $1.1 billion in 52-week sales, repre- senting a more modest but healthy 5% growth rate. Providing North American Wine Producers with Easy Methods for: STARS Tartrate Stabilization & pH Reduction Alcohol Adjustment (our place or on site) Volatile Acidity Reduction Wine Taint Removals: 4-EP Smoke Must Concentration via Reverse Osmosis Wine Clarification via Cross-flow Filtration Color Adjustment via Ultrafiltration Wine & Juice Clarification via Mobile Centrifuge CA: Napa, Sebastopol - OR: Dundee - TX: Spring Branch VA: Ashburn - BC: Summerland - ON: Niagara on the Lake www.winesecrets.com Tel: 888.656.5553 Wines & Vines sePTeMBeR 2011 11 . 20% 25% Dollar share, 52 weeks ending July 10, 2011, at major food and drug stores. Dollar Share for Domestic vs. Imported Wines Imported table wines are in a differ- ent boat. If retailers aren't seeing their overall revenues rise by 9%, it may be because imports are stuck at 1% growth Winesecrets_Dir11.qxp 12/9/10 2:49 PM Page 1 year on year, both in the recent four-week window and over 52 weeks, according to SIRI's data. —Jim Gordon Imported Wine Imported 22% Domestic 78% 15% D A T A CENTER 20% Percent growth by dollars, 52 weeks ending July 10, 2011, at major food and drug stores 25% Dollar Share for Domestic vs. Imported Wines

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