Large Wineries Losing Market Share to Small and Medium Sized Wineries???
http://sanjose.bizjournals.com/sanjose/stories/2004/07/19/daily9.html
Now, we ain't so good with cipherin' round here, but we're having a bit o' trouble figurin' out how small-to-medium sized wineries gained market share over big wineries. You see, we happen to have shipment figures for California wineries last year. The claim that small wineries gained 5 points of volume share does not seem possible.
2003 2002
Total CA shipments (in cases) 193mm 206mm
Shipments from wineries >1mm cases 172mm 182mm
Shipments from wineries <1mm cases 21mm 24mm
Small wineries % of total 11.0% 11.8%
Bronco, maker of "Two-Buck Chuck" grew by 5 million cases alone, and none of the other big guys reported material drops, so from where did the small wineries take their cut?!?!
When we look at revenue, small wineries probably sell for about 2.5x per case when compared to the big guys. Let's assume its about $32 per case for the big guys and $80 per case for the little guys. Therefore, we can assume that the .8% volume growth translates to about 2% in revenue (or $80/$32=2.5 x .8%). Where did the article's 11 points of revenue gain come from then?
Now, we ain't so good with cipherin' round here, but we're having a bit o' trouble figurin' out how small-to-medium sized wineries gained market share over big wineries. You see, we happen to have shipment figures for California wineries last year. The claim that small wineries gained 5 points of volume share does not seem possible.
2003 2002
Total CA shipments (in cases) 193mm 206mm
Shipments from wineries >1mm cases 172mm 182mm
Shipments from wineries <1mm cases 21mm 24mm
Small wineries % of total 11.0% 11.8%
Bronco, maker of "Two-Buck Chuck" grew by 5 million cases alone, and none of the other big guys reported material drops, so from where did the small wineries take their cut?!?!
When we look at revenue, small wineries probably sell for about 2.5x per case when compared to the big guys. Let's assume its about $32 per case for the big guys and $80 per case for the little guys. Therefore, we can assume that the .8% volume growth translates to about 2% in revenue (or $80/$32=2.5 x .8%). Where did the article's 11 points of revenue gain come from then?
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