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The Oregon Grape and Wine Industry

The Oregon Grape and Wine Industry. AAWE Conference 15 August, 2008. About Us. People: Honest, collaborative, friendly, accessible, authentic. Sources: NASS, Dr. Greg Jones, Southern Oregon University, 2008. Sources: NASS, Dr. Greg Jones, Southern Oregon University, 2008.

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The Oregon Grape and Wine Industry

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  1. The Oregon Grape and Wine Industry AAWE Conference 15 August, 2008

  2. About Us People: Honest, collaborative, friendly, accessible, authentic

  3. Sources: NASS, Dr. Greg Jones, Southern Oregon University, 2008 Sources: NASS, Dr. Greg Jones, Southern Oregon University, 2008

  4. Source: Dr. Greg Jones, Southern Oregon University, 2008 Sources: NASS, Dr. Greg Jones, Southern Oregon University, 2008

  5. Sources: NASS, Dr. Greg Jones, Southern Oregon University, 2008

  6. Sources: NASS, Dr. Greg Jones, Southern Oregon University, 2008

  7. Sources: NASS, Dr. Greg Jones, Southern Oregon University, 2008

  8. Economic Impact • Over $1.4B • 8,479 jobs • $203M in wine-related wages • $92M tourism revenue • 1.48M annual winery visits • Wine grapes rank in dollar value within Oregon agriculture: 4th Sources: Full Glass Research, OWB, OWA (2005)

  9. Ultra-Premium Focus • Successfully focused on the higher priced, higher quality segments • Highest average returns per ton • Highest average revenues per case • Despite producing a much smaller volume of wine, OR winery revenues per capita compare to NY and WA

  10. Outlook generally positive • Demand for PN & PG remains high • Production costs are reasonable for the quality obtained • Market outside NW underexploited, offering solid growth potential • Wine tourism underdeveloped compared to CA wine regions • ~5% percent of overnight leisure trips involved winery visits • Far lower than Mendocino, San Luis Obispo and Amador counties (10–25%) • Tourism infrastructure not keeping up with industry growth • However, competition fierce, especially in a softening economy • Market will need to absorb significant increases in the supply of PN and some other varietals

  11. Unique Business Challenges • No significant economies of scale – no large vineyards possible • Not about cost minimization, but margin optimization • No extraordinarily large player, unlike CA and WA • Limited marketing budgets • Many second career owners not in it for the money • Not always a rational economic system • Securing effective distribution in 3 tier system • Emphasis on direct distribution – margins vs. efficiency

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