Wines & Vines

September 2012 Winery & Vineyard Economics Issue

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METRICS Wine Industry Metrics Domestic Wine Sales $450 2011 2012 $400 2010 $300 $350 $250 Jan 2011 2012 2010 Up 7% from 2011 Apr Source: Symphony IRI Group, Wines & Vines Off-premise sales at major stores grew faster in dollars than volume (2%), while the average bottle price rose 23 cents in the four weeks ending July 8, 2012. Direct-to-Consumer (DtC) Shipments $210 $180 $150 $120 $90 $60 $30 Up 4% from 2011 2011 2012 2010 Jul Oct Dec Winery Jobs Lead Metrics As July Shows Positive Signs The Winery Job Index grew 63% in July over the same month in 2011, reflecting dramatic growth in winery hiring activity as the harvest season approached. Winemak- ing jobs in particular grew 139%, while sales, marketing and hospital- ity jobs increased at slower rates. Several years of regularly increasing domestic wine sales—and the emp- tying of bulk-wine reserves—have spurred production and increased personnel needs. Off-premise sales stayed steady at 7% growth, and direct-to-consumer shipments grew, though at a lower rate than in the past 12 months. 12 months through July 2011 and 2012 <$50 High-Priced Wines Sold DtC Growth rate by bottle price, ≥$50 15% 13% 11% 10% Jan Apr Jul Oct Dec Source: Wines & Vines/ShipCompliant Model DtC shipments in July tracked slightly above 2011 and 2010 indicators, while the 12-month growth rate stayed steady at 10%. Winery Job Index 220 180 140 100 60 20 2011 2012 2010 Up 63% from 2011 0 Volume Sales Source: Wines & Vines/ShipCompliant Model Jan Apr Jul Oct Dec Source: Winejobs.com Hiring activity bounced up dramatically in July, exceeding levels from the previous month as well as the past two years, according to the Winejobs.com index. 10 WINES & VINES SEPTEMBER 2012 Bottles priced at and above $50 showed faster growth in volume and total sales during the 12 months ending July 31 than those priced under $50. Higher priced wines grew by 11% in volume and 13% in sales, and lower priced wines grew at 6% in volume and 8% in sales. While higher priced wines' volume represented less than a quarter of the under-$50 volume, they generated nearly the same amount in dol- lars. Revenues were $658 million for wines $50 and up and $697 million for wines priced less than $50 per bottle. 6% 5% 8% Winejobs.com Index $ Millions $ Millions

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