Finding Common Ground: The Need for Cooperation and Collaboration in the Spanish Natural Wine Industry

In fall 2018 and late spring 2019, five small natural wine producers in Spain pondered the potential for cooperation and collaboration in their segment of the wine industry. As these niche producers shared their common goals and challenges, they debated how to come to a consensus about pooling resources and working together to educate trade customers as well as the prospective natural wine consumer. Providing an overview of the Spanish wine industry and the natural wine segment, this applied research paper uses comparative case studies to explore the potential of incorporating cooperative relationships that could help these producers grow their businesses, share farming and wine-making techniques, and educate consumers about natural wines. Similar to previous cooperative relationships undertaken in other wine-producing regions, co-opetition might not only perform branding and collaborative marketing and reward entrepreneurial activities in Spain’s natural wine sector, but also carry some downsides in terms of autonomy and control over decision-making.

Editor's Note & Industry Digest

The WBCRJ's mission is to provide exceptional decision-focused case studies involving real people and real events in the global wine business context. Volume 3 reflects a diversity of topics and regions that advance our knowledge of how wineries weigh the challenges of innovation and sustainability to achieve differentiation advantages.

Regional Spotlights

Regional Spotlights highlights four wine regions featured in Volume 3. No. 1: New Zealand, California's Lake County and Central Coast, and Spain.

Cloud-Based Computing: Providing an Advantage to a Small New Zealand Wine Business

Oliver and Charlotte Martin (names disguised at their request) were both employed full time and leading very busy lives when they purchased their small, wine-celebration business located in New Zealand. The Martins desired to play pivotal managerial roles in their new wine business while remaining in their current jobs, but soon realized that they had become over-committed and needed to outsource the accounting of their wine business to a seasoned professional. The Martins wondered whether investing in new information technology, specifically cloud-based accounting and customer relationship management (CRM) solutions, could help them become more efficient and effective as their winery operations grew. This case examines the risks and rewards of implementing cloud-based software programs. It also illustrates the linkages between the fields of marketing and management accounting, as the software programs highlighted in the case study have the ability to be integrated with each other.

Cypress Lane Estate: Human or Mechanical Harvesting?

Anthony Decker (name disguised at his request), director of farming at Cypress Lane Estate in Lake County, CA, was excited to harvest a newly developed 210-acre vineyard of sought-after Cabernet Sauvignon. This vineyard was expected to deliver Napa Valley-quality fruit at a fraction of the Napa Valley price. However, Decker approached the harvest with some trepidation, as increasing labor shortages were exerting financial pressure on vineyard operations, while the business was already hampered by narrow margins. Decker wondered how he could save on labor costs. Could mechanical farming reduce costs without damaging the quality of the fruit? This case explores the approximate scale at which financial benefits will be realized from long-term mechanical harvesting. Analysts can compare the costs of hand labor to machine labor, and assess the financial implications of either scenario, as well as identify the qualitative impacts. This case also discusses California’s ongoing wage legislation, agricultural overtime labor laws, and immigration issues.

The Longevity of Sustainable Vineyard Practices

Joelle Ainsley (name disguised at her request), a vineyard manager in California’s Central Coast, was concerned with the environmental impact of the conventional farming techniques used at her vineyards. She wondered if she could make her vineyards sustainable and leverage the increase in consumer demand for organic products. Considering that sustainability might be more expensive and time consuming to execute than conventional farming, Ainsley brought on a research team to examine the effects of sustainable practices. The team attempted to quantify the environmental and wine quality benefits. With data in hand, Ainsley must decide how to balance her desire to farm sustainably with the increased costs and unknown benefits of doing so. This case examines sustainable farming practices, looks at the cost and quality of sustainably grown grapes compared with conventional farming, and explores consumer attitudes toward organically produced wine. The case includes preliminary data that indicates increased soil health but no discernable increase in quality to the fruit or wine chemistry.