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2012 SUPPLIER GUIDE SUPPLIER SURVEY Company Name Start Businesses in the Clear 0 10 20 30 40 Financial Health of the Industry How would you describe the performance of the wine industry during the past year? Retreated Slowly 5% Remained Unchanged 15% Retreated Rapidly 1% Grew Rapidly 16% Financial Health of Your Wine Industry Clients How would you describe the financial health of your wine industry clients? 2012 response 2011 response 52% 33% Getting better 45% 48% Staying the same Grew Slowly 63% 3% 19% Getting worse 0 saying the wine industry experienced growth during the past 12 months. This fall, for the fifth consecutive year, W Wines & Vines asked providers of winery and vineyard equipment and services to evaluate the health of the wine industry, their own businesses and their clients' ability to pay. Respondents were mark- edly more positive in 2012, and their expectations for the coming year were equally hopeful. Suppliers' optimism regarding winery clients is prompting many to do something they haven't been able to do in years: raise prices. About 50% of vendors surveyed indicated that they plan to raise prices during the next 12 months, with 17% indicating that the increases will be more than 3% of current rates. The good news, however, is more than 90% of suppliers say the availability of cash and credit to 50 WINES & VINES NOVEMBER 2012 inery and vineyard suppliers saw their clients bounce back from recession this year, with nearly 80% of those sur- veyed by Wines & Vines 10% 20% vineyard and winery borrowers is at least as good if not better than in 2011. The year in review A whopping 79% of suppliers saw wine industry growth during the past 12 months, with 63% specifying slow growth and 16% indicating rapid expansion. Wine industry customers make up half the client roster for Santa Cruz, Calif.- based designer Ed Penniman, who said that while the economy has yet to recap- ture the heady days before the economic collapse of 2008, he's witnessed seasoned veterans and wine industry newcomers thinking outside the box. "Where in the past there might have been more of a trend toward line exten- sions, now some of the wineries that I'm working with are thinking of new product roll-outs," Penniman said. "There are more private labels: boutique wineries and individuals who have formed collec- tives to create wine." On the vineyard side, Dustin Hooper of Vintage Nurseries in California's San Joa- quin Valley contends it's not just the little 30% 40% 50% 60% guys who are expanding their businesses. "There's a lot of acreage going in, and it's all production stuff: Gallo, Constella- tion, the Wine Group," he said. "Basically everywhere they can plant a vine they're doing it, especially in the Central Valley, from Madera south." Client assessment Asked to evaluate the financial health of their clientele, less than 3% of suppli- ers said that wineries and vineyards are doing worse than in 2011. In fact, 52% of respondents reported that clients are performing better than last year, and 45% said client performance is the same as 12 months ago. One winery supplier told Wines & Vines, "I'm doing better, so my customers must be, too." Other respondents conced- ed that wineries appear to be performing better because they trimmed their budgets and in some cases their payroll in recent years, eliminating what was perceived to be unnecessary spending. Helene Champ of Active Club Solutions in Livermore, Calif., said that for the past Annual survey of suppliers reveals most positive outlook in years By Kate Lavin 50 60