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PowerPoint Presentation - University of Toronto

VIEWS: 5 PAGES: 16

									                    Wine
Innovation Systems Research Network
          Sixth Annual Meeting, May 13-14, 2004

    Caroline D Hickton, Simon Fraser University, cdh@sfu.ca
Tim Padmore, University of British Columbia, tim.padmore@ubc.ca
           BC Industry Profile

• Approximate 100 wineries and “wineries in-
  waiting”
• Two thirds are in the Okanagan Valley
• Rapid expansion
  – 1988: about 3000 acres
  – 2002: about 5000 acres
  – 2004+: from 7000 to 8000 acres
       Okanagan Cluster History

• Seed: 1925, first vinyard, foxy grapes
• Shoot: 1981, 14 wineries, handful of
  vinifera wineries, “I have a dream.”
• Shock: Free Trade Agreement 1988/89
• Sunshine: Pull-out program (2000 acres)
• Sugar: Love, money, imagination
       Innovation: performance

20

                                      Marketing –
15                                    selling
                                      Marketing –
                                      product design
10
                                      Making

 5                                    Growing


 0
     Firm    Region Canada   World
     first    first  first    first
       Number of medals




       0
             100
                   200
                         300
                               400
19                                   500
  95
19
  96
19
  97
19
  98
19
  99
20
  00
20
  01
20
  02
                                           Innovation: impacts




       0%
             10%
                   20%
                         30%
                               40%
                                     50%




              Medal Quality
            (#gold/# bronze)
               Innovation: inputs


                                       Prestige   Connectedness

Correlation of innovation with . . .   - 0.131        0.585

R-squared of the relationship . . .     0.017         0.342
                       Resources

• Land resources
                                                                      Kelowna




  – warmth, aridity, soil, bench-lands, beauty
• Human capital                  Princeton                       Penticton



• Financial capital
• Technology
                                                           Osoyoos
                             3




        “If we could grow grapes in Alberta, we’d go there,”
                       Infrastructure
• Irrigation system
• VQA
• Institutions
   –   Association of British Columbia Winegrowers
   –   BC Wine Information Centre
   –   British Columbia Wine Institute
   –   Ministry of Agriculture, Food and Fisheries
   –   Okanagan University College
   –   Okanagan Wine Festivals Society
   –   Pacific Agri-Food Research Centre
   –   UBC Wine Research Centre
• Regulation and government programs
                            Infrastructure

                           PA     BC    Wine      O     AB     UBC        Wine        MA
                           RC     WI    Fest      U     CW     Wine       Info        FF
                                                  C
Reports of fruitful
                            14     11         6     4      5          3           1    0
innovation linkages

Importance of links
                            15     12         7     5      5          3           1    0




          “Big wineries were not interested in VQA until the VQA proved itself.
                            Now they are very interested.”
          Related and supplier firms

•   Farmgate sales half of all VQA sales
•   “Asymmetrical symbiosis” with tourism
•   Grape trade routes (next slide)
•   Collapse of supply management
•   Consultants as conduits



“All this paled compared to the knowledge we got from the consultant.”
                      Kelowna




    Princeton      Penticton




                Osoyoos
3
             Firm structure and strategy

 • Size: “very small” to “medium large”
 • Investment phase in 1990s
 • Recent consolidation
      – Benign (?) impact of outside owners
 • Networks



   “The Okanagan region has mostly new people in the industry and as a result
must learn through experience and rely on other people in the industry as teachers.”
                                     Markets

     • Domestic (regional) market
     • Access to external markets
          – Rest of Canada
          – Rest of World




“It’s been a honeymoon here to not have to look beyond the BC market at the world market.”
           Future challenges

• Absorbing increased production
• Re-branding
• International competitiveness
                       Conclusion




Caroline D Hickton, cdh@sfu.ca
Tim Padmore, tim.padmore@ubc.ca

								
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