wine innovation systems research network sixth annual meeting, may 13-14, 2004 caroline d hickton,...
TRANSCRIPT
WineInnovation Systems Research
NetworkSixth Annual Meeting, May 13-14, 2004
Caroline D Hickton, Simon Fraser University, [email protected]
Tim Padmore, University of British Columbia, [email protected]
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
0
5
10
15
20
Firmfirst
Regionfirst
Canadafirst
Worldfirst
Marketing –selling
Marketing –product design
Making
Growing
Innovation: impacts
0
100
200
300
400
500
Nu
mb
er o
f m
edal
s
0%
10%
20%
30%
40%
50%
Med
al Q
ual
ity
(#g
old
/#b
ron
ze)
Innovation: inputs
Prestige Connectedness
Correlation of innovation with . . . - 0.131 0.585
R-squared of the relationship . . . 0.017 0.342
Princeton Penticton
Kelowna
Osoyoos3
Resources
• Land resources– warmth, aridity, soil, bench-lands, beauty
• Human capital
• Financial capital
• Technology
“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
“Big wineries were not interested in VQA until the VQA proved itself. Now they are very interested.”
PARC
BCWI
Wine Fest
OUC
ABCW
UBC Wine
Wine Info
MAFF
Reports of fruitful innovation linkages 14 11 6 4 5 3 1 0
Importance of links15 12 7 5 5 3 1 0
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.”
Princeton Penticton
Kelowna
Osoyoos3
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
