Strategic Management: Hunter Wine Company Essay

Question:

Discuss about the Strategic Management for Hunter Wine Company.

Answer:

Introduction

The Smith family founded the Hunter Wine Company (HWC) in the later phase of the 20th century. It is situated in the panoramic Hunter Valley of New South Wales and encompassed a vineyard of 25 hectares. The Hunter Wines comprised mainly Semillon, Chardonnay, Shiraz and Cabernet Sauvignon wines. Since 1990, the purview of the winery has expanded through the acquisition of nearby vineyards. Therefore, the acquisition had exacerbated the grape production and provided many wine making equipment resources. Such winery resources have unceasingly augmented the wine production capacity. At the same time, they have formed a liaison with other Hunter grape producers. The other Hunter Valley grape producers have supplied an additional quantity of grape resources to the winery (Hojman & Hunter, 2012).

Coming to the production angle, the earlier vintages offered a modest range, both in the respect of quantity and quality. At the same time, the company aims to improve both the technicalities of viticulture and methodologies of viticulture. Therefore, there is a phenomenal rise in both the quantity and quality of grape production by 2020. From the beginning, Hunter Wine Company has expanded the quantity and quality of grape production. It imbibed innovative grape production from other producers (Schweinsberg & Wearing, 2013). Consequently, the production of winery expanded, in terms of quality and quantity. The capacity of the winery also increased in the same way. The Hunter Wine Company is regarded as a premium producer of medium to high quality wines that gives uplift to the taste and preference of the customers. The winery has the potentiality to engender 10,000 cases annually that involve variegated flavours such as Semillon, Chardonnay, Shiraz and Cabernet Sauvignon (McIntyre, 2015).

History and Overview

The Hunter Valley Wine is the premier quality wine that the customers wanted. The company makes wine in incredibly inhospitable regions. The company produces wines in a terrain that countenances varied challenges. In the region of Hunter Valley, the Scarborough story developed. It stands for an incarnation of varied elements. Historically, the Hunter Valley is considered as Australia’s famous and leading wine region. Here, James Busby spawned the first cutting (Amadieu et al., 2013). In the 21st century, the region has vineyards that spanned a few centuries and manifest world’s resplendent versions. The region exhibits vagaries of climatic patterns and conventionally betrays the peculiar conditions to generate refreshing wines that the customers cherished. The most significant white grape would be Semillon. It is the favourite jewel in the Hunter’s crown. It necessitates a genuine fashion that the wide customer base cherishes all over the world. Chardonnay comes next in the list. The customers crave with unflinching determination for the grape. The Hunter Company specialized in the grinding and making of Chardonnay in the regions. The wine lovers are completely in love with the variety of wine. Talking about the red hue, Pinot Noir and Shiraz are the unswerving versions that permeate the Hunter Valley terrain. Hunter Shiraz gives a quintessential mark in the domain of wine making. It is another popular variety of grape and helps the process of wine making. Pinot is relatively lesser known in the region and entails an exquisite history of the first clone (MV6). Pinot forms a significant part of the Scarborough story.

The Hunter Winery produces wide varieties of wine, such as Semillon, Chardonnay, Shiraz and Cabernet Sauvignon. Semillon: Semillon is an extravagant wine and Scarborough produces quality paradigms of varied ranges. The white variety wine is displayed to explicate different technicalities and wine making influence. Verdelho: Verdelho is a new addition to the Scarborough family (McManus, 2016). It produces a white version of wine that is peculiar to the region and forms light, an opulent drinking pattern that gives a natural twist to the food. Chardonnay: At Hunter Winery, Chardonnay is the most elegant version that enthrals the customers to the hilt. The premium quality grape makes the wine an esteemed creation. The company is well acquainted with the production of wine of varied dispositions. Shiraz: The Hunter and Shiraz share a close connection. Like Semillon, the company produces Australia’s most remarkable quality wine that The Company shares an affinity with Shiraz and blends the two elegant versions in a amiable way (Grimstad & Burgess, 2014).

Resource, Capabilities and Core Competencies of the HWC

The Hunter Valley Winery assumes an important space in the sphere of food and tourism. The region has salubrious weather and climatic condition. It specialized in a variety of ways and helped in the enhancement of the Australian wine industry. The Hunter Valley Vineyard aims to ameliorate the development and marketing of the region. For the coming three years, the councils and Hunter Valley Company underscore varied efforts, pertaining to issues and provisions maintained within the purview of the plan. The Hunter Valley Winery sets the paradigm in the sphere of food and wine industry. The Hunter Valley winery forms a liaison with the key players of the region. It also ensures the significance of the branding of the wine. At the same time, the place is instrumental in moulding the Australia’s premier holiday destination.

Competitive advantage of the HWC

From the beginning, Hunter Wine Company has expanded the quantity and quality of grape production. It imbibed innovative grape production from other producers. Consequently, the production of winery expanded, in terms of quality and quantity. The capacity of the winery also increased in the same way. The Hunter Wine Company is regarded as a premium producer of medium to high quality wines that gives uplift to the taste and preference of the customers. The winery has the potentiality to engender 10,000 cases annually that involve variegated flavours such as Semillon, Chardonnay, Shiraz and Cabernet Sauvignon. Since 1990, the purview of the winery has expanded through the acquisition of nearby vineyards. Therefore, the acquisition had exacerbated the grape production and provided many wine making equipment resources. Such winery resources have unceasingly augmented the wine production capacity. At the same time, they have formed a liaison with other Hunter grape producers. The other Hunter Valley grape producers have supplied an additional quantity of grape resources to the winery.

Political Environment

The wine industry in Australia is going through a phenomenal phase, as it gains consistent assistance from the part of the government. Therefore, the companies, for an instance Hunter Wine capitalize on the improvement of the quality of the product. Therefore, the company is in the positive light.

Economic Environment

The Australian market is a profitable one, as far as the wine making is concerned. The rising purchasing power and the continuous pace of development have enhanced the taste and preference of the customers. In the recent time, the potential Australian winery countenances the challenges from the leading domestic and international wine company. The French wine companies, such as Ross Duke wine company throw a gauntlet to the Australian winery.

Social

Being a temperate region, the people of Australia always are accustomed to drinking wine. At the same time, the western culture profoundly influenced the landmass. After the invasion of the British, the natives of the regions imbibed the Western drinking style. Therefore, the business of winery assumes a wider dimension in the respective domain. The social and economic purposes greatly facilitate the business of Hunter Wine Company of New South Wales, Australia.

Technological

Technologically, the Australian wineries have adopted various strategies and technicalities. The technological paradigm of the winery received a good boost. They give huge challenges to the foreign wineries, particularly French and British wineries. The United States and English wines are treated with great respect and they hugely influence the making of the French winery.

SWOT analysis of Hunter Wine Company

With the assistance of SWOT analysis, one can comprehend the strengths, weaknesses, perils associated with the growth of Hunter Wine Company of Australia.

Strength : The Hunter Wine Australia is growing exponentially. It provides a wide base that caters to the taste and preference of the customers. At the same time, the government is supporting the particular wine sector and the pervasive wine market.

Weakness : In Australia, the wine market is highly segmented that contributes to the betterment of the customer’s preference. The Australian society has an overt nature towards the acceptance of the wine culture.

Oppurtunities : The wine market is highly segmented and it caters to the taste and preference of the customers. The main cities of the country such as New South Wales, Sydney and Melbourne developed an extravagant wine culture. The experts believe that wine culture is ingrained on the citizens of Australia. The rules and regulations for the Australian Wineries are not complex. They are relatively simple (Tsukrejev, 2014).

Threats : The wine market is highly competitive. This is the major threat for wine market.

Relevant Economic Market Drivers and Wine Consumption pattern

The Hunter Wine Company has expanded the quantity and quality of grape production. It imbibed innovative grape production from other producers. Consequently, the production of winery expanded, in terms of quality and quantity. The capacity of the winery also increased in the same way. The Hunter Wine Company is regarded as a premium producer of medium to high quality wines that gives uplift to the taste and preference of the customers. The winery has the potentiality to engender 10,000 cases annually that involve variegated flavours such as Semillon, Chardonnay, Shiraz and Cabernet Sauvignon. Since 1990, the purview of the winery has expanded through the acquisition of nearby vineyards. Therefore, the acquisition had exacerbated the grape production and provided many wine making equipment resources. Such winery resources have unceasingly augmented the wine production capacity (Christ & Burritt, 2013).

International market strategy, Entry barriers and Trade Agreements

The experts believe that there are a plenty of ways that the company uses for the purpose of entering a foreign market. Direct exporting is an essential way that all the company use in the hindsight. For the case of Hunter Wine Company, we choose various strategies such as tariff rates. The Japanese market is a profitable one, as far as the wine making is concerned. The rising purchasing power and the continuous pace of development have enhanced the taste and preference of the customers. In the recent time, the potential Australian winery countenances the challenges from the leading domestic and international wine company. The French wine companies, such as Ross Duke wine company throw a gauntlet to the Australian winery (PTY, 2015). Hence, international expansion is highy recommendable.

While considering the entry of the organization in Australia, it must be remembered that the major obstacle or barrier is tariff. Japan is one of those countries, where the government has levied subbstantal taxes on the wine-producing organizations. As a result, this will increase the cost of production for the organization, and as there are already many small, emerging wineries located in Japan, the organization may not be able to sustain itself for a long time. In case, the organizaton is willing to sustain itself in Astralia, it may consider forming trade agreements with large organizations of Astralia, such as Adria International Co Ltd, Tokyo Kinoshita Shoji , that are known for retailing in the wine market.

The Potential for Mergers and Acquisitions

In the era of globalization, the organization can also consider gaining recognition via the process of merging and acquisition. It should be remembered, that in case the organization is willing to expand in Australia, it is likely to suffer from a huge competition from the domestic wine market of Australia. Hence, it is discreet that the organization merges with a recognized organization of Australia, such as the Adria International Co Ltd. These organizations enjoy technological infrastructure as well as the skilled labor force, that will enable the Hunter Wine Australai easily establish itself. Besides, the consumers are the changing forces of the organization, and as such sufficient research has to be done, on the changing preferences and growing needs of the consumers. However, as an emerging organization in Japan, Hunter wine Australia may not be willing to invest an enormous amount for research studies. Hence, merging with an established organization will save the company from additional investment in research field.

Blue Ocean Strategy

Chan Kim and Ren?e Mauborgne formulated the Blue Ocean strategy (Lock et al., 2016). They observed that companies tend to engage in head-to-head competition in search of sustained profitable growth. The Hunter Wine Company of Australia is a popular company that produces the premier quality wine for the Australian customers. France is known for the production of best quality wines for the global customers. The Australian company countenances challenges from the French and British wine companies. Therefore, they invest in the making of an opulent version of wine that tapped the global competition. They have aspired to widen the horizon of the business, in a sense to maximise the profit of the company.

Strategic Leadership

The premise of strategic leadership entails vision and direction for the maintenance of an organization. A strategic leader assists the employees to raise the rate of productivity. The Hunter Valley Winery assumes an important space in the sphere of food and tourism. The region has salubrious weather and climatic condition. It specialized in a variety of ways and helped in the enhancement of the Australian wine industry (Flint et al., 2015). The Hunter Valley Vineyard aims to ameliorate the development and marketing of the region. For the coming three years, the councils and Hunter Valley Company underscore varied efforts, pertaining to issues and provisions maintained within the purview of the plan. The Hunter Valley Winery sets the paradigm in the sphere of food and wine industry. The Hunter Valley winery forms a liaison with the key players of the region. It also ensures the significance of the branding of the wine. At the same time, the place is instrumental in moulding the Australia’s premier holiday destination (Olsen et al., 2016).

Organizational Structure, Controls and Corporate Structure:

The organization follows a hierarchical organizational structure. The management section of the organization, is clearly divided into three levels- the higher management, the middle management and the junior management. The organization has an owner, and a board of directors, who are directly responsible for the formulation and implementation of the plans and business strategies. Under this level, the managers work, who are responsible for executing the business strategies, communicating with the junior level of management and thereby improving the operational efficiency of the organization. Finally, under the junior level of management, works the employees ad regular staffs, who work in accordsnce with the direction received from the higher authority. As far as the organizational control is concerned, the organization follows a unitary structure, whereby the power of administration or decision-making capacity, lies in the hands of limited few.

Conclusion

In Australia, the wine market is highly segmented that contributes to the betterment of the customer’s preference. The Australian society has an overt nature towards the acceptance of the wine culture. After the intrusion of the British, the society became receptive towards western tends and element . The environmental-friendly products and health care play a crucial role in motivating the customers. Wine is an important element that strikes a balance between social and business life. The wine market is highly segmented and it caters to the taste and preference of the custom

Reference

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