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WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 __________________________________________________________________________________

2020-21 ANNUAL REPORT

WINE INDUSTRY ASSOCIATION OF WA (INC.) 4 November 2021

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WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 __________________________________________________________________________________

Contents Introduction

2020-21 Strategic Priorities

President’s Report

Chief Executive Officer’s Report

Treasurer’s Report

Membership and APC Collection Report

RD&E Technical Committee Report

Board of Directors Report

Export and Wine Tourism Market Development

Wines of WA 2020-21 APC Budget

Financial Report 2020-21

Appendices 2016 - 20 State Vineyard and Production Data 2017 22 WA Wine RD&E Strategic Priorities Plan 2014 – 24 WA Wine Industry Strategic Plan Summary International Wine Tourism Grant Final Report Export Growth Partnership 2020-21 Activity Rwport

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WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 Introduction

Wines of WA Charter

The Wine industry Association of Western Australia (Inc.) Wines of Western Australia), established in 1987, is the state’s primary organisation of wine producers.

WA producers have mandated that Wines of WA should, “provide stewardship of the industry” to create opportunities for producers and the fine wine regions of WA.

It is our mission to provide a unified, strategically influential voice that creates opportunities for the fine wine regions of Western Australia.

From an operational point of view, this service is provided through: •

levels, understands our industry – the benefits we provide to the state economy, particularly in regional WA and the assistance and resourcing we require to further develop our industry.

Industry Overview Wine is a major value adding industry with significant regional economic and employment benefits. In 2020-21 the total value of the WA wine industry was estimated at $684 million with a grape value of $65 million. Regarding market channels, 48% of total value was sold in WA, 40% in eastern Australia and 12% in exports.

•

WA Wine Industry Vision

“a Western Australian wine industry that grows sustainably and profitably, built on the reputation of its great fine wine regions” The pathway to this vision is a unified and strategical influential industry focused on regional fine wines of provenance and authenticity. Producers and Regional Associations are the custodians of their Regional brand.

Representation to ensure the value of

industry is clearly understood by government, the community and other complimentary industry sectors. We work to ensure our social license to operate is retained and strengthened. We continue to build strong partnerships with tourism, developing complimentary market development programs. We work raise the stature of our industry so that West Australians are truly proud of our wine industry.

The Western Australian wine industry produces about 42 million litres of wine annually representing 4% of the volume of Australia’s wine production but 8.5% of the value.

As outlined in the WA Wine industry Strategic Plan 2014 – 24, WA producers have a shared vision of:

Advocacy to ensure government, at all

•

Administration of technical and

marketing program funding to provide Regional Associations and producers opportunities to improve business practises and market access. •

Communication to ensure wine

industry participants are aware of the issues that affect their businesses, enabling them to make informed decisions on the direction of the industry and their individual businesses.

We look forward to working with Producers and Regional Associations in 2021-22 on developing a sustainable and profitable future for the WA wine industry.

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WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 __________________________________________________________________________________

Strategic Priorities 2020-21 Priority

INDUSTRY STRUCTURE AND DEVELOPMENT

Priority Issues

Activities and Progress

Assist Regional Associations securing resources/funding to implement strategic plans

Federal wine tourism grant (IWTG), Export Growth Partnership (EGP) and Growers’ Group Grant supported Regions to implement strategic priorities. Regional Program funding supported RDE strategic priorities

Secure Wine Tourism/ Export Market Development funding and resources in collaboration with RAs and producers

Finalised EGP agreement with State government. IWTG funding agreement completed

Build a culture of collaboration with an expectation of success

MARKET DEVELOPMENT Strategic regional collaboration driven by energised producers

Assist RAs to implement regional strategies

Build partnerships (government, value chain, allied sectors) to support Regional brand development and increase national and international consumer demand

Smoke taint SUSTAINABILTY, INNOVATION, RDE&A AND BIOSECURITY All of industry best practise across the value chain

WoWA Tech Committee to actively promote Sustainable Wine-growing Australia to WA producers and support regional initiatives to adopt best practise to achieve international recognition as a world leader in sustainable wine-growing Monitor new planting material resources and availability

ADVOCACY AND REPRESENTATION Lean, proactive, unified and Influential

Ensure taxation regime offers best operational environment for WA fine wine producers. Ensure legislation and regulation offers best operational environment for WA fine wine producers. Ensure an enduring social licence for WA wine producers.

Provided funding to Regions to complete various projects across the value chain

Worked with Tourism WA, Development Commissions, local government and allied sectors to complete IWTG and initiate EGP

Supported Regions and producers to manage prescribed burns programs. Build stronger relationships with DBCA and OBRM In partnership with Department of Primary Industries, Technical Committee implemented programs to address identified challenges through the Wine Australia Regional Program WoWA to advocate for policy settings and government support to address identified challenges

Shared industry ratified position for further taxation reform with other regions/states. Advocate for further amendments to Liquor Control Act to improve access to market, including direct to consumer channels Worked with Australian Grape and Wine and other states to ensure aligned and strong communications/advocacy.

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WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 __________________________________________________________________________________

President’s Report We expected the 2020-21 financial year to be the exit out COVID 19. Instead, we are “learning to live with it”. The impact of it cannot be ignored and all businesses have been affected to some degree. This is true for WoWA as well. As our remit is to ensure the best operational environment for WA producers. Restrictions on movement and business operations arising from COVID 19 related restrictions have been significant. While WA has largely returned to “normal” internally, there remain challenges which WoWA continues to address on behalf of WA producers. WoWA engaged consistently with state government, ensuring the interests of WA producers were clearly understood. We must also reflect on the work plan that WoWA established for 2020-21. Despite the requirement to maintain a watching brief on COVID 19 issues for much of 2020-21, we still addressed our key strategic areas of focus. These are highlighted below.

National Advocacy Tax Following industry ratification of the Wines of WA tax position statement in 2019-20, the WoWA Board approved an advocacy strategy to be implemented by WoWA executive. CEO Larry Jorgensen has begun work on this through engagement with regions and states nationally Wine Industry Structural Reform Australian Grape and Wine (AGW) Board endorsed a process to assess alternative national industry body structures to create better alignment between industry priorities and investment of industry paid levies. Larry Jorgensen sits on the working committee and has reported on progress to date to the WoWA Board.

Export Market Development and Diversification The imposition of severe tariffs on Australian wine exported to China required significant input by WoWA to the national World Trade Organisation submission. However, every challenge brings opportunity. In response, the federal government developed the Agricultural Trade and Market Access Cooperation support package (ATMAC). WoWA has worked with AGW in developing the first-year application for support. WoWA provided detail on the WA wine industry partnership with the state government to grow and diversify export markets (see below), assisting AGW to develop an industry informed submission. We expect that in subsequent years, WA will receive direct funding via the ATMAC program.

State Advocacy Legislation and Regulation Much of the legislation and regulation that has day to day impact on producers and growers is set at state level. WoWA works with Regional Associations to ensure state government and all local members are aware of the specific issues at state level that are important to WA wine growers and producers. As in 2019-20, the key legislative/regulatory issues addressed this year were related to COVID 19 restrictions. As the state moved through various levels of restrictions on movement, WoWA worked closely with the Department of Health and Racing, Gaming and Liquor to ensure producers were able to operate as freely as possible. WoWA ensured producers understood clearly what their obligation were so that they could comply while operating their businesses. Additionally, we continue to work across state and local government to ensure smoke taint events related to prescribed burning programs do not impact on WA wine growers and producers. It is a delicate balance and we understand the importance of risk mitigation 5|Page

WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 activities. A constant and well-informed conversation with all who implement prescribed burning is imperative to this. Export Market Development and Wine Tourism In 2020-21, WoWA focused on formal approval of state government funding support for our Export Growth Partnership strategy (EGP). The agreement was signed in May 2021. In September 2021, WoWA appointed Hydra Consulting to develop the strategic framework for the EGP. It is pleasing to see that the significant effort by all levels of the WA wine industry over the previous 3 year has produced this result. The final phase of the International Wine Tourism Grant (IWTG) was implemented in 2020-21. Despite the challenges posed by COVID, a range of on-line and live events were executed, working with South West and Great Southern Development Commissions, Australia’s South West, Destination Perth and Tourism WA to support Regional Associations and producers in marketing their wine tourism products to international visitors. The legacy of this program will carry forward as the increased capacity to provide and market wine tourism products will continue to grow as Regions and producers more fully understand the potential of this market channel. In closing, I would like to thank Larry and Robin for their tireless work for WoWA on behalf of all State producers. I would also like to thank Paula Henderson, who has been our bookkeeper for the past three years. Paula is moving on later this year to focus more on family. Trevor Whittington I ndependent Chair

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WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21

Chief Executive Officer’s Report As outlined in Strategic Priorities for 2020-21 our focus for the year prioritised: •

Assisting Regions to implement strategic plans and secure funding and resources to implement these

•

Secure funding and resources and implement programs for international and domestic market development including wine tourism

•

Ensure legislation and regulation offers best operational environment for WA fine wine producers and ensure an enduring social licence for WA wine producers.

•

Addressing RD&E priorities through the WA wine technical committee leveraging federal and state government agencies funding and resources

The key activities to achieve these aims were, Advocacy, Representation, Administration and Communication

Advocacy In 2020-21, Wines of Western Australia advocated for the industry on the following issues: •

•

Continued work with the Tax Working Group. An advocacy strategy has been agreed by the WoWA Board and this was implemented in 2020 – 21. Continued engagement with the state government and Wine Australia to secure resources to support export market development for WA wine producers. A funding agreement for $6 million over five years was signed in April 2021 Worked with all Regional Associations and the Department of Biodiversity Conservation and Attractions to establish late season burn-off protocol to ensure late harvested fruit was not affected by prescribed burning. Worked at state and federal level to ensure that COVID 19 related

restrictions were implemented with minimal impact on WA wine producers Representation In 2020-21, Wines of Western Australia engaged the following government and industry bodies on the following issues: •

• •

•

Minister for Agriculture and the Department of Primary Industries and State Development and Minister for Tourism and Tourism WA, advocating for increased funding for market development, wine tourism and industry development. Participated in industry round-table meetings regarding COVID 19 restrictions Liaised with government agencies (liquor licensing, tourism, primary industries) on a range of COVID 19 issues ensuring industry was informed on compliance requirements Attended Wine Australia and Australian Grape and Wine interstate meetings Administration

Administration In 2020-12, Wines of WA administered the following projects on behalf of the WA wine industry: •

• • • • • • •

Worked with APC administration and Wine Producers’ Committee to refine collection process for FFS collection on the 2020 vintage. Compliance requirements for the Wine Australia Regional Program. Management of the WA Wine Technical Committee Negotiated terms for the WA wine industry service agreement with Australia Post Negotiated terms for the WA wine industry co-membership arrangement with CCIWA Project management/compliance of the EGP with State Government Project management/compliance of IWTG. Project management of R4R Growers’ Group Grant, “Pathways to Premium Markets” Page | 7

WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21

Communication In 2020-21, we continued our regular communications strategy including

We currently have the following Industry Working Groups: •

Wines of WA Technical Committee which provides oversight of the Wine Australia Regional Program other RDE&A activities and biosecurity issues for WA producers

•

A weekly e-newsletter which provides non-time sensitive information.

•

For urgent, critical information, members receive an email or text message directly from me, sent from ceo@winewa.asn.au

•

Eye to eye on a regular basis to share a coffee or a glass wine, depending on the time of day, discussing what you feel are the key issues affecting your business and region

Wine Tourism Alliance (WTA) which provided oversight of the IWTG project, and will continue to provide a formal link between industry and tourism partners

•

Wines of WA Tax Working Group (TWG) which was commissioned to produce a ratified tax position paper for the WA wine industry. This process is ongoing. A draft position statement is currently undergoing an industry consultation process.

•

Export Growth Partnership Industry Steering Committee. Comprised of the WoWA CEO, industry representatives and DPIRD, this working oversees and approves the EGP program developed by Hydra Consulting

•

Financial Review Committee (FRC) Comprised of the WoWA Executive Committee and Board members, the FRC provides oversight of WoWA’ grant funding financial commitments

•

Additionally, we continued to develop www.winewa.asn.au as a highly ranked consumer facing landing site for WA wine through IWTG projects including: •

the localista searchable database was linked directly to the Australian Tourism Data Warehouse which feeds into Australia.com, Tourism Australia’s consumer facing platform

•

the Wine Adventurer guide to the fine wine regions of WA

•

the Wine Exportal, a one stop information shop for WA producers

Human Resources Wines of WA has one employee however, through contracted professional services and formalised working groups, our capacity to deliver value through the fee for service model has been greatly enhanced. We currently have the following contracted service providers:

It is important that WA continues to provide energised and capable people at a national representative level to ensure our state issues are understood and addressed. In 2020-21, WoWA facilitated the following input at national level. Australian Grape and Wine Western Australian Board representatives were:

•

Trevor Whittington as Independent Chair

•

Hydra Consulting as Project Manager of the EGP

•

Robin Birch as Communications Consultant

•

Cath Oates (Small Winery Membership Committee) Larry Jorgensen (Small Winery Membership Committee) Colin Bell (Vignerons’ Committee) Page | 8

WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 Cath owns Oates’ Ends and is the Wine Australia Board Deputy Chair Larry is CEO of Wines of WA. Colin is a Director of AHA Viticulture. Wine Australia In addition to these formalised positions, Wines of WA has continued to strengthen our relationships with other State and Regional organisations. We will continue to communicate and collaborate with our inter-state partners to advocate collectively where common interests exist. Cath Oates continued as a Board member of Wine Australia in 2020-21 and is Deputy Chair. In closing, I wish to acknowledge the contribution and support of the following people: •

Regional Association Committees who have provided input to the development of policies and programs to support industry development.

•

Producers who have provided input to the development of policies and programs to support industry development.

•

The Wine Tourism Alliance, which is a regional, cross-industry committee bringing together a wealth of regional knowledge and energy. While its current remit is oversight of the IWTG, members agree it will be legacy that endures, strengthening the Regional collaboration to develop profitable tourism business in region.

•

The Wines of WA Technical Committee, Chair Lee Hasselgrove, Jim CampbellClause, David Botting, Steve Partridge Richard Fennessy and

•

The Tax Working Group and specifically, David Martin whose work in this area over a number of years has been extraordinary.

•

The Wines of WA Board of Directors, and specifically, Independent Chair, Trevor Whittington and Treasurer David Bowyer

In closing, I would like to acknowledge: - the input of Robert Olde who resigned in 2020-21. As Vice- Chair of Wines of WA in Robert contributed significantly to all areas but specifically to the Tax Working Group. We wish him well in his future endeavours - Our bookkeeper Paula Henderson who will leave us in the coming months. Paula has provided dependable and patient service to Wines of WA over the past three years. We wish her well.

Larry Jorgensen

Chief Executive Officer November 4 2021

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WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21

Treasurer’s Report

the WA Government, as well as the initial recognition of long service leave for Larry Jorgensen, the CEO. As a result, the net operating surplus of the association decreased from $105,000 to $50,000.

The 2020-21 Financial Year has been a challenging and complex year for Wines of WA. Despite the uncertainties created from the ongoing COVID-19 pandemic, the Association successfully completed the International Wine Tourism Grant while continuing to deliver its core services of advocacy and representation.

Grant activities

Overview The summary of the Association’s income and expenditure is as follows:

Operating activities Revenue APC Producer Grant Funding Membership Fee Cash Flow Boost Wine Education Centre Total Revenue

2021

2020

$000's

232 9 16 8 265

267 13 12 2 294

Operating Expenditure Net Operating Surplus

(215) 50

(189) 105

Grant activities Grant Income Grant Expenditure Net Grant Expenditure

875 (974) (99)

632 (637) (5)

(Deficit)/surplus for the year

(49)

100

Operating activities Revenue from operating activities totalled $265,000 for the year compared with $294,000 in the prior year, a reduction of $29,000. Most of this reduction arose from APC Producer Grant Funding which decreased by $35,000, driven by the decrease in the total tonnage from Vintage 19 (50,000 tonnes) to Vintage 20 (45,961 tonnes) and the decision taken by the WoWA Board to reduce FFS rates by 5% noting the potential challenges that COVID may have presented to producers. Overall operating expenditure increased from $189,000 in the prior year to $215,000 in the current year. This increase was due to a combination of the resumption in various advocacy and representation activities following the release of several COVID-19 restrictions by

Grant activities comprise income and expenditures that relate specifically to various grant programs and are therefore excluded from Operating activities. Net grant expenditure amounted to $99,000 compared with $5,000 in the prior year. The increase primarily attributable to the Association’s contribution to the International Wine Tourism Grant which, with the exception of a $7000 shortfall from industry funding, was anticipated as part of the Grant agreement with Wine Australia. Deficit/Surplus for the year Although the net result of the above was a deficit for the year, the year-ending cash and equity positions remained strong at $286,000 and $104,000 respectfully. Financial Review Committee Following the end of the 2020-21 year the Board of Wines of WA set up a Financial Review Committee (FRC). The terms of reference of the FRC are to oversee the financial and risk implications of the Wine Export Growth Partnership (known as the WA Wines to the World Program) which will cover a 5-year period from July 2021 with a total expenditure of $6 million. I would like to thank Larry, Trevor and the rest of the Board for the amazing support I have received since joining the Board earlier this year. David Bowyer

Treasurer

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WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21

Membership and APC Collection Report

business planning. The information is archived to the Wines of WA website.

The WA wine industry again utilised the fee for service APC funding model for the 2020-21 financial year. The fees were affected against the 2020 vintage. A fee per tonne was collected from the owner of the fruit at crush and distributed to Wines of WA to provide statebased services and to Regional Associations based on the GI origin of the fruit to provide regionally based services.

Percentage of Producers by Production Category

WoWA worked with producers, Regional Associations and the APC Wine Producers’ Committee, to further refine the collection process in 2020-21. The aggregated budgeted revenue from APC collections for 2020-21 was $557,496, based on a 47,000 tonne vintage. The final reported amounts at 30 June 2021 were $564,417 and 45,961 tonnes. This represents 100.1% of budgeted revenue and 98% of projected volume. WoWA APC income was budgeted to be $258,000 with $260,736 collected. In total, 332 producers provided return forms for payment with a further 78 lodging “nil” returns. The aggregated figure, 408, is higher than the typically quoted number of 350 active businesses in WA. Nil returns are attributable to smoke-taint events, yearly production decisions to balance inventory and the variety of business models that exist. As the fee is attributable to the owner of fruit at crush, businesses that typically purchase finished or raw wine would not submit a return form for payment. Industry Production Data A significant benefit arising from the APC collection is resulting production data. Information collected via the process includes GI origin of fruit by variety. This provides an accurate snapshot of production capacity and will be invaluable to producers in determining how to structure their business to best meet market demand. As industry settles into acceptance of the APC, further information can be collected to provide more detail to support

FFS Collection by Production Category

Current Producer Member Benefits Australia Post Membership entitles access to the Wines of WA alliance with Australia Post whereby members can take advantage of specialised wine handling and delivery services at significantly reduced prices in both the domestic and overseas markets.

Chamber of Commerce and Industry, WA (CCIWA) Membership permits access to the dual Wines of WA / CCI membership agreement. This provides members with access to the full range of CCI member benefits including: advice and assistance on industrial relations, workplace agreements, worker’s compensation, occupational safety and health, industry Page | 11

WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 training, trade, environmental compliance and more.

Affiliate Membership Benefits Affiliate members receive the following benefits: •

• •

Receive regular issues of the WoWA Enewsletter and keeping up to date with all the latest wine industry news Access and notification to networking events and workshops with WOWA wine producers and growers Access to WA wine industry Australia Post parcel rates,

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WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 RD&E Technical Committee Report The Wines of WA Technical Committee oversees the development and implementation of the Wine Australia Regional Program for WA. The Program provides grants-based funding for R&D projects with specific regional relevance. The Committee also reviews: biosecurity • • •

water security resource management biosecurity issues

Committee Members for 2020-21 were: Lee Hasselgrove – Mure Viticulture (Chair) Jim Campbell-Clause – AHA Viticulture Dave Botting – Burch Family Wines Con Simos – AWRI Andrew Taylor - DPIRD Jeremy Galbreath - Curtin University Richard Fennessy – DPIRD Keith Pekin – Perth NRM Michael Considine – UWA Larry Jorgensen – Wines of WA

RD&E 5 Year Strategic Plan In January 2017, the Wines of WA Technical Committee undertook a facilitated strategic planning session to identify the RD&E strategic priorities over the next 5 years. The 2017 - 22 WA Wine industry RD&E Strategic Priorities Plan (RDESP) is included in the appendices and is available on the Wines of WA website in the Technical Section. The plan will be reviewed in the 2021-22 financial year. The process included a request for input from all WA producers. The responses were collated reviewed these, noting the frequency of identified issues in determining 5 key focus areas:

•

Smoke taint

•

Chemical resistance

•

Improved clonal material (including alternative varieties)

•

Business model innovation

•

Pest and disease management

•

Sustainable viticulture

The RDESP is the guiding document in determining what issues are addressed by industry through research and extension in partnership with state and federal government agencies.

Wine Australia Regional Program The Regional Program is funded through Wine Australia. In each year, the Technical Committee identifies key issues to be addressed through extension programs. The Annual Operating Plan for each year is available on the WoWA website in the Technical section. Program administration is provided by WoWA. DPIRD provides project management through Richard Fennessy. It should be noted that as some of the activities involved interstate and international speakers, these were postponed until travel resumes.

2020-21 activities Virus Symposium This activity was scheduled for May 2020 but was disrupted due to COVID-19, Limestone Coast and WA are considering presenting this event in May 2021 as an online symposium accessible to the respective regional producers. Grape vine viruses pose a significant risk to the productivity, quality and sustainability of Australian vineyards. Many within the industry believe this disease is a great threat to our industry, especially when considering the costs Page | 13

WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 incurred in other world wine regions such as Marlborough and Napa Valley due to virus. Therefore, producers have a need to gain better understanding of the complexities of this disease. Proposed expert speakers include Dr Vaughn Bell (The New Zealand Institute for Plant & Food Research Limited), Dr Fiona Constable (Plant Virologist, Department of Environment and Primary Industries), Dr Cath Kidman (Treasury Wine Estate), Dr Monica Kehoe (Plant virologist, DPIRD) and Alison Mathews (Entomology, DPIRD). Objectives Increase grower awareness of viruses and their potential commercial impact 2. Provide an overview of latest technologies and methodologies for detecting viruses and practical tips for effective sampling Demonstrating how clonal selection can influence Cabernet Sauvignon wine quality In 2019, a block of mature Cabernet Sauvignon vines in Margaret River were grafted over to 12 clones of Cabernet as part of a Wine Australia funded project. The first crop off these vines is expected in 2021, the activity will involve the harvesting and small lot winemaking of these 12 clones so to have wines available for industry tastings. The more involved Wine Australia project is expected to begin in 2025. Anecdotally, the clonal diversity of Cabernet Sauvignon in both Margaret River and Western Australia is predominately clone 126 and a mass selection of the local ‘Houghton clone’. There are 20 clones/selections accessible to WA producers via public and private collections. The activity aims to improve the knowledge of viticulturists and winemakers on the benefit of clonal diversity while also bringing awareness of the national project beginning in coming years. Objectives 1. By August 2021 up to 50 WA viticulturists and winemakers will have increased awareness

and knowledge of clones of Cabernet Sauvignon available in WA and their unique attributes displayed in one year from a trial site in Margaret River 2. Up to 90% of attendees of the tasting will understand the benefit of multi-clonal plantings compared to mono-clonal Progress Fourteen clones/selections have been bottled, alcohols range from 12.4% to 14.0%. The wines will be presented at a workshop in Margaret River on 18 October 2021. Biosecurity training Wine tourism and general tourism into WA wine regions is experiencing significant growth especially in the Margaret River wine region where interstate flights will soon be operating at the nearby Busselton airport. Associated with this increase in regional visitations is the risk to growers of biosecurity incursions of pests and diseases not yet present in WA and also the transmission of pests and diseases between local vineyards. Research conducted by Vinehealth Australia in 2017 indicated that 44% of female visitors and 28% of male visitors to wine regions expect to be able to walk amongst vines and take photos as part of their wine experience. Currently very few grape and wine producers in Western Australia have policies or plans on how to mitigate biosecurity risks associated from both public and private entries onto vineyards. This is most obvious by the lack of visible signage at vineyards communicating biosecurity risks and the policies applicable to properties. This activity will engage Vine Health Australia to conduct workshops in key visitation areas to inform producers on the biosecurity risks and provide tools on how to best manage these risks. The outcome is to have a majority adoption by WA grape growers within key visitation regions of best practices for farm gate hygiene to ensure the health and sustainability of WA vineyards. Page | 14

WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 This activity addresses the priorities of sustainable viticulture and pest and disease management as identified in the WA Strategic Review conducted in 2017. Objectives 1. Have approximately 90 WA wine producers develop and execute biosecurity initiates to mitigate risks associated with visitors to their properties within 3 months of the workshops 2. At least 90% of workshop attendees will have improved their knowledge and skills in addressing biosecurity risks associated with visitors after attending the workshops 3. At least 90% of workshop attendees will consider the workshops to be valuable or very valuable use of Regional Program funds Outcomes Craig Elliott from Wine Australia delivered two workshops in Margaret River (17 & 18 August) and one in Swan Valley (20 August). Great Southern event only attracted one registration so was cancelled. Numbers attended in Margaret River was 21 and 8 in Swan Valley. Key learnings: 1. Producer engagement on matters relating to biosecurity is difficult 2. The WA wine industry views biosecurity as a key priority but this is not shared at the grower level 3. Much can be improved in terms of best practices on WA vineyards to manage biosecurity risks Workshopping the use of machine harvesters to manipulate bunch architecture WA growers are beginning to experiment with the potential of managing bunch rots through non-spray methods. One of these techniques is the use of mechanical harvesters over vines post flowering. Harvesters are used to remove trash trapped in the bunches that act as potential inoculum sources and manipulate

bunch architecture, improving airflow and spray penetration. New Zealand are the leaders of this work and have been successfully utilising and honing this technique for a number of seasons. Viticulture consultant Mark Allen has been a key player in optimising harvester setup for this work. However, as New Zealand growing regions have different climatic conditions and production techniques to south-west WA production, some application differences are likely to be required. With an increasing movement towards more sustainable practices, the use of harvesters to reduce bunch rot severity and incidence will assist growers in reducing the need for fungicide applications. DPIRD pathologist Dr Andrew Taylor is completing a trial (Incubator Initiative) in WA regions assessing the impact of this technique on the varieties Sauvignon Blanc, Semillon and Chardonnay. This activity will consist of workshops in at least two WA wine regions with NZ viticulturist Mark Allen sharing his experiences and Dr Andrew Taylor to present his research findings. Objectives 1. By January 2021 provide over 70 growers with the knowledge of a nonspray method of managing bunch rot through the use of mechanical harvesters post-flowering. 2. By January 2021 extend the research findings from Incubator Initiative on this topic specific to WA conditions involving key varieties via grower workshops. 3. Develop protocols for optimal set up of various harvester brands to maximise bunch trash removal or architecture manipulation by June 2021 Outcomes A summary of this work will be included in the September 2021 edition of the Wine Industry Newsletter. Page | 15

WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 Key learnings: 1. Shaking the fruit reduced bunch rot incidence in Chardonnay, Sauvignon Blanc and Semillon. 2. Shaking the fruit reduced bunch rot severity only in Semillon 3. Shaking the fruit caused variation in bunch characteristics, depending upon variety.

including interpretation of data 2. Promote the adoption of SWA, increase membership by at least 25% within WA by June 2021 Outcomes Workshops completed, Margaret River (29 June) had 30 people attend and Great Southern (21 July) with 6 producers in attendance.

4. The time of shaking with regard to fruit development is likely to have impacted on bunch rot incidence and / or severity. Promoting sustainable winemaking production

Key learnings:

The WoWA Technical Committee identified sustainability as a key priority during a strategic review conducted in 2017. Specifically, to reduce the environmental impact and enhance long-term success and resilience by increasing capacity of best practice sustainable land management practices by wine growers and wineries.

1. SWA is the ideal platform for wine producers to certify their sustainability credentials and benchmarking with peer producers

The increased capacity to undertake these practices will improve and protect soil condition, biodiversity, water quality and better manage pests and diseases, waste, social and economic impacts through the introduction of an environmental plan and implementation of environmentally sustainable management practices.

3. Case studies presented showed practical means to reduce agrichemicals, power usage and water use

With the launch of Sustainable Winegrowing Australia (SWA) in 2019 there is now a national program to assist and support producers to achieve sustainable best practices within their businesses. This activity plans to utilise the resources of this program to encourage adoption, regional benchmarking and optimisation of sustainable practices through a series of regional workshops presented by Mardi Longbottom (AWRI). Objectives 1. By December 2020, provide over 50 producers with an understanding of the functionality of the Sustainable Winegrowing Australia (SWA) program

2. Support is available via the AWRI and Margaret River Wine Association for producers wanting to join or become certified

Pruning workshops Simonit & Sirch is a global consulting and training company in vine pruning and training. They have developed a pruning method that focuses on four principles; branching, vascular flow, cuts and crowns and protective wood. The objective of this method is to ensure longevity and productivity. Due to COVID travel restrictions, this has been postponed until winter 2022 As some of WA’s vineyard approach 40 – 50 years of age growers are facing new challenges to manage vine health and maintain commercially viable yielding capacity. Aspects of the Simonit & Sirch method addresses necrotic wood and trunk disease thus important strategies in adopt when pruning old vines. This activity aims to promote new thinking when considering pruning and to educate growers on Page | 16

WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 how best to handle older vines to ensure longevity. Objectives 1. For attendees of the workshops to reassess their pruning strategies and methodologies 2. Present growers with practical techniques to manage and maintain aging vines 3. At least 90% of workshop attendees will consider the workshops to be valuable

Development of the 2021-22 Wine Australia Regional Program The plan was developed through the West Australian wine industries technical committee and WoWA. A committee meeting was held at DPIRD's Bunbury office on the 5th of February 2020 to prioritise regional RD&E issues for the regional program based on the outputs from the 5-year strategic planning process undertaken in January 2017. This prioritisation process also considered feedback from regional associations and direct contact with producers. Though the wine producing regions throughout WA are diverse, the selected activities for 2020 - 21 program aim to be of benefit to all regions.

Approved Regional Program Annual Operating Plan 2021-22 Developing and assessing cellar door experiences Wineries can attract a diverse range of visitors, each looking for a tailored and unique experience. Using visitor tracking analytics and customer profiling it is possible to develop a wide range of activities and experiences and test their effectiveness and impact on cellar door ROI. Using insights and techniques developed through their Incubator Initiative project, Dr Ben Thomas and Associate Professor Jeremy Galbreath will deliver a seminar on how wine producers tier their cellar door service offering and maximise the value delivered a range of

customer segments. Topics covered will include: • • • • •

Different customer segment profiles Ways to tier your service offering Effectiveness of each service offering as a revenue stream Impact of charging for wine tastings Ways to implement data collection and cellar door service offering optimisation

Objectives 1. 50 wine producers will be provided insights into different wine tourist profiles and their behaviours when visiting cellar door 2. 50 wine producers will understand techniques to collect data to develop their own customer profiles 3. 50 wine producers will understand different approaches to developing cellar door experiences to match visitor profiles and increase customer spending Garden weevil webinar Garden weevil is an important pest to the key growing regions in Western Australia. The most effective management tools to control this pest are synthetic insecticides. Consequently, garden weevil management is deemed a barrier to many growers wishing to be certified organic. This activity aims to provide growers with the latest information from South African researchers using biological agents and also an opportunity to hear from other experts and practitioners on organic techniques that growers could consider incorporating into an IPM strategy. The webinar will be recorded so stakeholders unable to attend can access the information. Objectives 1. At least 40 growers will have accessed this planned webinar by June 2022 2. 85% of attendees will have their knowledge improved of the potential of Page | 17

WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21 biological control agents and management practices outside of Australia concerning garden weevil. Regional winemakers’ trial forums First held in Margaret River in 2015 by the Department of Primary Industries and Regional Development, this forum allows winemakers to come together and share experiences on innovative techniques that aim to improve wine quality or production efficiencies. This forum allows the winemakers to bring in wines from their in-house trials and share their findings with others and also to generate general discussion. These forums will be conducted in the Swan Valley, Margaret River and Great Southern. Objectives 1. At least 40 producers will attend these events across the three regions, 90% of which will perceive these tastings as valuable or very valuable use of Regional Program funds. 2. Attendees will share knowledge of innovative vineyard and winery practices by contributing their own wine trials and/or providing opened commentary of the wines as they perceive them. 3. At least 80% of attendees will believe they have improved their knowledge on a certain theme due to these tasting events. National Coonawarra Australian Cabernet Symposium – Margaret River satellite event Collaborating with the Coonawarra Wine Association and Limestone Coast, this activity will provide a Margaret River satellite venue to the National Coonawarra Australian Cabernet Symposium so to showcase two of Australia’s key Cabernet Sauvignon producing regions and to make this a truly national event. International and national expert speakers will feature in the program to present the latest in research findings applicable to premium Cabernet sauvignon production.

Objectives 1. Have over 60 WA producers attend and be exposed to the latest international and national R&D concerning the production of premium Cabernet Sauvignon 2. From the information presented, 80% of attendees will consider adopting some of the principles and techniques into their own practices in producing Cabernet Sauvignon 3. 80% of attendees to have found this event valuable or very valuable use of levy funds Trunk disease survey As many of WA’s vineyards have vines of +30 years of age a significant number are experiencing die back (arm death). DPIRD is regularly contacted by producers who believe they have Eutypa lata in their vineyards however Eutypa has not been detected in WA and these reported symptoms are likely to be due to Botryosphaeria. This activity will offer subsidised testing of symptomatic vines (up to 50 across the state) which provide growers with an identified disease, a better understanding of trunk disease pathogens within WA and consequently better information on how to treat these issues. Objectives 1. 50+ producers to be provided with specific trunk disease diagnosis and appropriate management options by December 2021. 2. 80% of webinar attendees to have an improved understanding of trunk diseases prominent in WA. 3. 80% of producers contributing samples and webinar attendees to have found this activity valuable or very valuable use of levy funds.

Page | 18

WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21

Market Development Support

Export Growth Partnership

International Wine Tourism Grant

The Export Growth Partnership (EGP), with the customer facing project name, “WA Wines to the World” was initiated in 2020-21. The EGP is a five-year partnership between the WA wine industry and the State government. Each partner will contribute $3 million dollars to support export market development and growth activities. The aims are to double the value of wine exported from WA to over $100 million, increase the average price per litre to over $12 and increase the number of WA producers who are successfully and profitably exporting.

The activities implemented through the International Wine Tourism Grant (IWTG) completed in June 2021. As with most things, COVID 19 had a significant impact on the IWTG given the main KPIs were to increase visitation and spend in WA by international wine tourists. None the less, a comprehensive body of work was completed across the four main areas outlined in the grant application. These were: 1. Collaboration: Collaborate to better align regional wine tourism investment / programs 2. Product development: Support continuous improvement of the WA wine tourism experience 3. Integrated promotion: Grow visitor numbers and spend using integrated communication strategies 4. Regional support: Develop data and tools to support wine tourism investment. (6.2.1a) A comprehensive overview of grant activities is included in the appendix.

In September 2020, Hydra consulting was appointed as project manage on an initial 12month contract with a brief to: Act as a face of the project to build relationships, identify opportunities for funding and sector relationships • Confirmation of participating partners • Confirm/validate target markets • Create and initiate a market development/comms strategy • Export resource matrix development • Preferred supply chains identification •

A summary 2020-21 outcomes is included in the appendices.

Page | 19

WINES OF WESTERN AUSTRALIA ANNUAL REPORT 2020-21

Wines of WA Board of Directors 2020-21 Independent Chair Trevor Whittington (appointed 2017) trevor.whittington@iinet.net.au

Producer Representatives 0 - 150 tonnes David Mazza (appointed 2017) Mazza Wines david@mazza.com 151 - 1000 tonnes Robert Olde (appointed 2017 and retired March 2021) Latitude 34 Robert.olde@latitude34wineco.com Cameron Rhodes (appointed May 2021) Fermoy Estate cameronrhodes@fermoy.com.au Over 1000 tonnes Mike Calneggia (Appointed 2019) Calneggia Family Vineyards mike@cfvwine.com.au

Regional Representatives Swan Valley/Perth Hills/Peel GI Garth Cliff (Appointed 2020) Vino Volta garth@vinovolta.com.au Josh Davenport (Appointed 2020) Myattsfield myattsfield@bigpond.com Geographe GI Ryan Gibbs (Appointed 2020) Aylesbury Estate geovit@westnet.com.au Margaret River GI Liz Mencel (Appointed first term in 2018 and second term in 2020) Naturaliste Vintners liz@purplefeet.com.au

Blackwood Valley/Pemberton/Manjimup GI Ashley Lewkowski (Appointed first term in 2018 and second term in 2020) Lost Lake info@lostlake.com.au Great Southern GI Tom Wisdom (Appointed first term in 2018 and second term in 2020) Plantagenet Wines Tomw@plantagenetwines.com

Growers’ Representative Robert Mann (Appointed first term in 2018 and second term in 2020) Corymbia rob@doolette.com.au

Skills Based Appointment David Bowyer (Appointed February 2021) Ferngrove dbowyer@ferngrove.com.au

Executive CEO Larry Jorgensen Wine of WA +61 448 884 161 ceo@winewa.asn.au

Executive Committee Independent Chair Trevor Whittington (Appointed 2017) trevor.whittington@iinet.net.au Treasurer David Bowyer (Appointed February 2021) Ferngrove dbowyer@ferngrove.com.au CEO Larry Jorgensen Wine of WA +61 448 884 161 ceo@winewa.asn.au

Margaret River GI Amanda Whiteland (Appointed 2019) Margaret River Wine Association amanda@margaretriver.wine

Page | 20

Wines of WA Proposed Operational Budget 2020 - 21 Proposed APC Services Industry Structure and Development - Assist Regional Associations with APC implementation/Provide Secretariat Services to APC Committee - Assist Regional Associations with implementation of strategic planning, securing resources - Provide support and administration to industry structure for regional collaboration on Federal International Wine Tourism Grant, export market develpement and industry development

Total FFS required Strategic Plan Reference $20,000 SFA 2.1 - 2.3; pg. 25 $10,000 SFA 1.1, 1.4; pg. 24 $5,000 SFA 1.1, 1.2; pg. 24 SFA 3.3 Pg. 26 $5,000 SFA 5.1, 5.2 Pg. 30

Budget

Market Development and Consumer Interaction - Industry co-contribution to Federal International Wine Tourism State Grant (IWTG) projects - Assist RAs to implement regional components of IWTG - Further develop partnership with state government, industry and Wine Australia to grow consumer and market demand/wine tourism

$85,000

$40,000

RD&E/Technical

SFA 3.1.2.3 pg. 26 $10,000

- Provide Secretariat services to Technical Committee

$5,000

- Administer AGWA Regional Program

$5,000

Advocacy - Legislation/Regulation - Maintain/enhance high level relationships with all relevant government agencies and industry stakeholders - Project ManageTax Working Group to monitor WET legislation changes and investigate simpler and fairer taxation models - Maintian communication strategy and engagement to manage controlled burn/smoke taint risks - Work with Wine Australia on Sustainable Winegrowing Australia program to implement in WA - Work with Australian Grape and Wine on wine and health related issues - Advocate for red tape reduction regarding liquor licensing and other compliance requirements

SFA 5.1; pg. 30 SFA 5.2; pg. 30

$30,000 $15,000

$40,000 $10,000 $10,000 $30,000 $10,000 $15,000

$115,000

SFA 4.1 - 4.4; pg. 28 SFA 6.1 - 6.3; p. 31 SFA 4.1 - 4.4; pg. 28 SFA 6.1 - 6.3; pg. 31

SFA 1.3; pg. 24 SFA 10.1, 10.2; pg. 35 SFA 8.2; pg.33 SFA 7.1 - 7.4; pg.32 SFA 9 pg. 34 SFA 9 pg. 34 SFA 5; pg. 30 SFA 1 pg. 24

2020 Wines of WA Production and FFS Estimate

Total Volume Production Average Charge Per Revenue Estimated Membership Production Volume Tonnes Base Fee Volume Fee Tonne in Across Members in Fee (ex Across Category Processed Range Range Range GST) Range up to 2 0.96 75.00 $0.00 $0.00 $75.00 $900.00 12 11.52 2.88 100.00 $0.00 $0.0000 $100.00 $3,000.00 30 86.4 over 2- 5 5.84 165.00 $0.00 $0.0000 $165.00 $4,125.00 25 146 over 5 - 10 11 11-29t 14.8 225.00 $50.00 $13.1579 $275.00 $20,625.00 75 1110 30 30-49 32 475.00 $23.75 $11.8750 $498.75 $12,468.75 25 800 50 50 - 99 57.92 712.50 $60.19 $7.6000 $772.69 $30,907.68 40 2316.8 100 100 - 199 116.64 1,092.50 $94.85 $5.7000 $1,187.35 $29,683.70 25 2916 200 200 - 299 201 1,662.50 $4.28 $4.2750 $1,666.78 $28,335.18 17 3417 300 300 - 499 305 2,090.00 $19.00 $3.8000 $2,109.00 $33,744.00 16 4880 500 500 - 749 531.6 2,850.00 $60.04 $1.9000 $2,910.04 $14,550.20 5 2658 750 750 - 999 765 3,325.00 $22.80 $1.5200 $3,347.80 $20,086.80 6 4590 1000 1000 - 1999 1210.88 3,705.00 $220.37 $1.0450 $3,925.37 $31,402.96 8 9687.04 2000 2000 - 3999 2043.6 4,750.00 $41.42 $0.9500 $4,791.42 $14,374.26 3 6130.8 4000 4000 - 5999 4079.52 6,650.00 $56.66 $0.7125 $6,706.66 $13,413.32 2 8159.04 6000 6000 - 9999 6100 8,075.00 $35.63 $0.3563 $8,110.63 $0.00 0 0 10000 10000+ 10000 9,500.00 $0.00 $0.0000 $9,500.00 $0.00 0 0 Total Revenue $257,616.84 289 46908.6

Wines of WA Board of Directors 2020-21

Schedule of Meeting Attendance and Summary of Terms Board Position Skills Based - Independent Chair Trevor Whittington Producer Under 150 Tonnes David Mazza - Mazza Wines Producer 151-1000 Tonnes Robert Olde - Latitude 34 Cameron Rhodes – Fermoy Estate Producer Over 1000 Tonnes Mike Calneggia – Calneggia Family Vineyards Perth Hills/Peel/Swan Valley Daniela Tonon – Tonon Vineyards Garth Cliff – Vino Volta Geographe Pippa Nielsen – Treasurer – Vineyard 28 Ryan Gibbs – Aylesbury Estate Margaret River Liz Mencel – Margaret River Wine Association Amanda Whiteland - Margaret River Wine Association Blackwood Valley/Southern Forests Ashley Lewkowski – Lost Lake Great Southern Tom Wisdom - Plantagenet Skills Based Grower Representative Robert Mann - Corymbia Skills Based Treasurer David Bowyer - Fenrgrove Executive Chief Executive Officer Larry Jorgensen – Wines of WA

P A N/A

Present Absent Not Applicable Board Meeting Teleconference Annual General Meeting

Appointment/ Retirement Date

August

Sept

AGM

Nov

Dec

Feb

Mar

Apr

May

Jun

N/A

Appointed January 2021

N/A

Originally appointed May 2013 Contract re-confirmed March 2021 Meeting Notes

Re-appointed December 2020

Appointed to 2nd Term October 2019 Appointed to 2 Term October 2019. Retired March 2021 Appointed to first term May 2021 nd

Appointed to 1st term December 2019 Appointed October 20. Retired October 2020 Appointed to 1st term October 2020 Appointed to 3rd term October 2018 Retired October 2020 Appointed to 1st term October 2020 Appointed to 2nd tern October 2020 Appointed to 1st term October 2019 Retired October 2020 Appointed to 2nd term October 2020 Appointed October 2020

*Tom Wisdom Chaired Meeting

Wine Industry Association of Western Australia Inc. ABN 23 095 700 543

Special Purpose Financial Report - 30 June 2021

Wine Industry Association of Western Australia Inc. Contents 30 June 2021 Committee's declaration Committee's report Auditor's Independence Declaration Auditor's Report Statement of profit or loss and other comprehensive income Statement of financial position Statement of changes in equity Statement of cash flows Notes to the financial statements

2 3 4 5 8 9 10 11 12

General information The financial statements cover Wine Industry Association of Western Australia Inc. as an individual entity. The financial statements are presented in Australian dollars, which is Wine Industry Association of Western Australia Inc.'s functional and presentation currency. Wine Industry Association of Western Australia Inc. is a not-for-profit incorporated association, incorporated and domiciled in Australia. Its registered office and principal place of business is: Level 2, 161 Great Eastern Highway Belmont 6104 A description of the nature of the incorporated association's operations and its principal activities are included in the Committee's report, which is not part of the financial statements. The financial statements were authorised for issue on 28 October 2021.

Directors:

Robert Campbell RCA, CA Viral Patel RCA, CA Alastair Abbott RCA, CA Chassey Davids RCA, CA

AUDITOR’S INDEPENDENCE DECLARATION TO THE MEMBERS OF WINE INDUSTRY ASSOCIATION OF WESTERN AUSTRALIA INC. I declare that, to the best of my knowledge and belief, during the year ended 30 June 2021 there has been: (i) (ii)

no contraventions of the auditor independence requirements of the Associations Incorporation Act 2015 (WA); no contraventions of any applicable code of professional conduct in relation to the audit.

Dated this 3rd day of November 2021

Viral Patel, CA, CPA Registered Company Auditor number 333615

Director Australian Audit

PO Box 7465, Cloisters Square PO, WA 6850 | Level 8, 251 St Georges Terrace, Perth, WA 6000 (08) 9218 9922 | info@ausaudit.com.au | www.australianaudit.com.au | ABN: 63 166 712 698 Liability limited by a scheme approved under Professional Standards Legislation

Trade mark of Chartered Accountants Australia and New Zealand and used with permission

Directors:

Robert Campbell RCA, CA Viral Patel RCA, CA Alastair Abbott RCA, CA Chassey Davids RCA, CA

INDEPENDENT AUDITOR’S REPORT To the members of Wine Industry Association of Western Australia Inc. Report on the Audit of the Financial Report Opinion We have audited the financial report of Wine Industry Association of Western Australia Inc. (the Entity), which comprises the statement of financial position as at 30 June 2021, the statement of income and expenditure, statement of changes in equity and statement of cash flows for the period then ended, and notes to the financial statements, including a summary of significant accounting policies and the statement by the Members of the Committee. In our opinion the accompanying financial report has been prepared in accordance with requirements of the Associations Incorporation Act 2015 (WA) including: a) giving a true and fair view of the Entity’s financial position as at 30 June 2021, and of its financial performance and its cash flows for the period then ended; and b) complying with Australian Accounting Standards to the extent described in Note 1. Basis for Opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Entity in accordance with the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Emphasis of Matter – Basis of Accounting We draw attention to Note 1 to the financial report, which describes the basis of accounting. The financial report has been prepared to assist the Entity to meet the requirements of the Associations Incorporation Act 2015 (WA). As a result, the financial report may not be suitable for another purpose. Our opinion is not modified in respect of this matter. Responsibilities of Management and Those Charged with Governance for the Financial Report Management is responsible for the preparation and fair presentation of the financial report and have determined that the basis of preparation described in Note 1 to the financial report is appropriate to meet the requirements of the Associations Incorporation Act 2015 (WA) and the needs of the 5

Trade mark of Chartered Accountants Australia and New Zealand and used with permission

members. The responsibility of Management also includes such internal control as management determines is necessary to enable the preparation and fair presentation of a financial report that is free from material misstatement, whether due to fraud or error. In preparing the financial report, management is responsible for assessing the Entity’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless management either intends to liquidate the Entity or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Entity’s financial reporting process. Auditor’s Responsibilities for the Audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. As part of an audit in accordance with Australian Auditing Standards, we exercise professional judgment and maintain professional scepticism throughout the audit. We also: •

Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

•

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Entity’s internal control.

•

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

•

Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Entity’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Entity to cease to continue as a going concern.

•

Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Yours faithfully,

Viral Patel, CA, CPA Registered Company Auditor number 333615 Director Australian Audit

Date: 3 November 2021

Wine Industry Association of Western Australia Inc. Statement of profit or loss and other comprehensive income For the year ended 30 June 2021

Revenue

Grant and Project Income APC Producer Grant Funding Membership Fee Cash Flow Boost Interest Income Wine Education Centre

Note

2021 $

2020 $

874,512 232,000 9,386 16,110 105 7,928 1,140,041

631,749 267,300 12,722 11,814 222 2,045 925,852

1,140,041

925,852

4 5 6

(142,215) (832,416) (143,589) (6,080) (1,188) (3,429) (604) (4,752) (27,364) (2,569) (1,556) (6,695) (2,184) (923) (1,588) (407) (5,233) (5,718) (42) (1,188,552)

(101,651) (535,180) (125,925) (7,933) (911) (3,456) (5,698) (4,751) (13,523) (2,319) (1,101) (5,545) (5,389) (62) (6,657) (4,058) (1,373) (198) (3) (825,733)

(48,511)

100,119

(48,511)

100,119

Total revenue

Expenses

Grant Expenses IWTG Expenses Employee Benefit Accounting Fee Bank Fee Insurance Hospitality Expenses Memberships Representation and Consultants Computer Maintenance and Supplies Communication and PR Occupancy Administration MV Allowance Travel and Accomodation Venue Hire and Meeting WEC Expense Other expenses Finance costs Total expenses

(Deficit)/Surplus for the year attributable to the members of Wine Industry Association of Western Australia Inc. Other comprehensive income for the year

Total comprehensive income for the year attributable to the members of Wine Industry Association of Western Australia Inc.

The above statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes 8

Wine Industry Association of Western Australia Inc. Statement of financial position As at 30 June 2021 Note

2021 $

2020 $

7 8

285,561 76,307 361,868

592,788 198,331 791,119

9 10

1,832 2 1,834

2 2

363,702

791,121

4,926 220,915 2,935 30,757 259,533

3,527 615,472 1,397 18,045 638,441

Total liabilities

259,533

638,441

Net assets

104,169

152,680

104,169

152,680

104,169

152,680

Assets Current assets

Cash and cash equivalents Trade and other receivables Total current assets

Non-current assets

Property, plant and equipment Intangibles Total non-current assets

Total assets Liabilities Current liabilities

Trade and other payables Contract liabilities Borrowings Provisions Total current liabilities

11 12 13 14

Equity

Retained surpluses

Total equity

The above statement of financial position should be read in conjunction with the accompanying notes 9

Wine Industry Association of Western Australia Inc. Statement of changes in equity For the year ended 30 June 2021 Issued capital $

Reserves $

Retained profits $

Total equity $

Balance at 1 July 2019

52,561

Surplus for the year Other comprehensive income for the year

100,119 -

Total comprehensive income for the year

100,119

Balance at 30 June 2020

152,680

Retained profits $

Total equity $

Issued capital $

Reserves $

Balance at 1 July 2020

152,680

Deficit for the year Other comprehensive income for the year

(48,511) -

Total comprehensive income for the year

(48,511)

Balance at 30 June 2021

104,169

The above statement of changes in equity should be read in conjunction with the accompanying notes 10

Wine Industry Association of Western Australia Inc. Statement of cash flows For the year ended 30 June 2021 Note

2021 $

2020 $

891,562 (1,187,980)

1,007,978 (811,209)

(296,418) 104

196,769 222

(296,314)

196,991

(1,832)

Repayment of borrowings Hire Purchase

1,538 (10,619)

(8,244) (12,549)

Net cash used in financing activities

(9,081)

(20,793)

(307,227) 592,788

176,198 416,590

285,561

592,788

Cash flows from operating activities Receipts from customers Payments to suppliers and employees Interest received Net cash (used in)/generated from operating activities

Cash flows from investing activities

Payments for property, plant and equipment Net cash used in investing activities

Cash flows from financing activities

Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of the financial year Cash and cash equivalents at the end of the financial year

The above statement of cash flows should be read in conjunction with the accompanying notes 11

Wine Industry Association of Western Australia Inc. Notes to the financial statements 30 June 2021 Note 1. Significant accounting policies The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

New or amended Accounting Standards and Interpretations adopted

The incorporated association has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period. Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.

Basis of preparation

In the Committee's opinion, the incorporated association is not a reporting entity because there are no users dependent on general purpose financial statements. These are special purpose financial statements that have been prepared for the purposes of complying with the Western Australian legislation the Associations Incorporation Act 2015 and associated regulations. The Committee has determined that the accounting policies adopted are appropriate to meet the needs of the members of Wine Industry Association of Western Australia Inc.. These financial statements have been prepared in accordance with the recognition and measurement requirements specified by the Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') and the disclosure requirements of AASB 101 'Presentation of Financial Statements', AASB 107 'Statement of Cash Flows', AASB 108 'Accounting Policies, Changes in Accounting Estimates and Errors', AASB 1048 'Interpretation of Standards' and AASB 1054 'Australian Additional Disclosures', as appropriate for not-for profit oriented entities.

Historical cost convention The financial statements have been prepared under the historical cost convention, except for, where applicable, the revaluation of financial assets and liabilities at fair value through profit or loss, financial assets at fair value through other comprehensive income, investment properties, certain classes of property, plant and equipment and derivative financial instruments. Critical accounting estimates

The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the incorporated association's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in note 2.

Revenue recognition

The incorporated association recognises revenue as follows:

Revenue from contracts with customers Revenue is recognised at an amount that reflects the consideration to which the incorporated association is expected to be entitled in exchange for transferring goods or services to a customer. For each contract with a customer, the incorporated association: identifies the contract with a customer; identifies the performance obligations in the contract; determines the transaction price which takes into account estimates of variable consideration and the time value of money; allocates the transaction price to the separate performance obligations on the basis of the relative stand-alone selling price of each distinct good or service to be delivered; and recognises revenue when or as each performance obligation is satisfied in a manner that depicts the transfer to the customer of the goods or services promised.

Wine Industry Association of Western Australia Inc. Notes to the financial statements 30 June 2021 Note 1. Significant accounting policies (continued) Variable consideration within the transaction price, if any, reflects concessions provided to the customer such as discounts, rebates and refunds, any potential bonuses receivable from the customer and any other contingent events. Such estimates are determined using either the 'expected value' or 'most likely amount' method. The measurement of variable consideration is subject to a constraining principle whereby revenue will only be recognised to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognised will not occur. The measurement constraint continues until the uncertainty associated with the variable consideration is subsequently resolved. Amounts received that are subject to the constraining principle are recognised as a refund liability.

Membership Fee Revenue from the membership fee is recognised on receipt basis. Rendering of services Revenue from a contract to provide services is recognised over time as the services are rendered based on either a fixed price or an hourly rate. Interest Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset. Other revenue Other revenue is recognised when it is received or when the right to receive payment is established.

Income tax

As the incorporated association is a tax exempt institution in terms of subsection 50-10 of the Income Tax Assessment Act 1997, as amended, it is exempt from paying income tax.

Current and non-current classification

Assets and liabilities are presented in the statement of financial position based on current and non-current classification. An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the incorporated association's normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period. All other assets are classified as non-current. A liability is classified as current when: it is either expected to be settled in the incorporated association's normal operating cycle; it is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities are classified as non-current.

Cash and cash equivalents

Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

Trade and other receivables

Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within 30 days.

Wine Industry Association of Western Australia Inc. Notes to the financial statements 30 June 2021 Note 1. Significant accounting policies (continued) The incorporated association has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue. Other receivables are recognised at amortised cost, less any allowance for expected credit losses.

Property, plant and equipment

Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and equipment (excluding land) over their expected useful lives as follows: Buildings Leasehold improvements Plant and equipment

40 years 3-10 years 3-7 years

The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date. Leasehold improvements are depreciated over the unexpired period of the lease or the estimated useful life of the assets, whichever is shorter. An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the incorporated association. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss.

Impairment of non-financial assets

Non-financial assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. Recoverable amount is the higher of an asset's fair value less costs of disposal and value-in-use. The value-in-use is the present value of the estimated future cash flows relating to the asset using a pre-tax discount rate specific to the asset or cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to form a cash-generating unit.

Trade and other payables

These amounts represent liabilities for goods and services provided to the incorporated association prior to the end of the financial year and which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition.

Contract liabilities

Contract liabilities represent the incorporated association's obligation to transfer goods or services to a customer and are recognised when a customer pays consideration, or when the incorporated association recognises a receivable to reflect its unconditional right to consideration (whichever is earlier) before the incorporated association has transferred the goods or services to the customer.

Borrowings

Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They are subsequently measured at amortised cost using the effective interest method.

Wine Industry Association of Western Australia Inc. Notes to the financial statements 30 June 2021 Note 1. Significant accounting policies (continued) Finance costs

Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are expensed in the period in which they are incurred.

Employee benefits Short-term employee benefits Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities are settled. Other long-term employee benefits The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting date are measured at the present value of expected future payments to be made in respect of services provided by employees up to the reporting date using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the reporting date on national government bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.

Fair value measurement

When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure purposes, the fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; and assumes that the transaction will take place either: in the principal market; or in the absence of a principal market, in the most advantageous market. Fair value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming they act in their economic best interests. For non-financial assets, the fair value measurement is based on its highest and best use. Valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, are used, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

Goods and Services Tax ('GST') and other similar taxes

Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the tax authority. In this case it is recognised as part of the cost of the acquisition of the asset or as part of the expense. Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the tax authority is included in other receivables or other payables in the statement of financial position. Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the tax authority, are presented as operating cash flows. Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the tax authority.

New Accounting Standards and Interpretations not yet mandatory or early adopted

Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory, have not been early adopted by the incorporated association for the annual reporting period ended 30 June 2021. The incorporated association has not yet assessed the impact of these new or amended Accounting Standards and Interpretations.

Wine Industry Association of Western Australia Inc. Notes to the financial statements 30 June 2021 Note 2. Critical accounting judgements, estimates and assumptions The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below.

Allowance for expected credit losses The allowance for expected credit losses assessment requires a degree of estimation and judgement. It is based on the lifetime expected credit loss, grouped based on days overdue, and makes assumptions to allocate an overall expected credit loss rate for each group. These assumptions include recent sales experience and historical collection rates. Fair value measurement hierarchy The incorporated association is required to classify all assets and liabilities, measured at fair value, using a three level hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date; Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and Level 3: Unobservable inputs for the asset or liability. Considerable judgement is required to determine what is significant to fair value and therefore which category the asset or liability is placed in can be subjective. The fair value of assets and liabilities classified as level 3 is determined by the use of valuation models. These include discounted cash flow analysis or the use of observable inputs that require significant adjustments based on unobservable inputs.

Impairment of non-financial assets other than goodwill and other indefinite life intangible assets The incorporated association assesses impairment of non-financial assets other than goodwill and other indefinite life intangible assets at each reporting date by evaluating conditions specific to the incorporated association and to the particular asset that may lead to impairment. If an impairment trigger exists, the recoverable amount of the asset is determined. This involves fair value less costs of disposal or value-in-use calculations, which incorporate a number of key estimates and assumptions. Employee benefits provision As discussed in note 1, the liability for employee benefits expected to be settled more than 12 months from the reporting date are recognised and measured at the present value of the estimated future cash flows to be made in respect of all employees at the reporting date. In determining the present value of the liability, estimates of attrition rates and pay increases through promotion and inflation have been taken into account.

Note 3. Grant and Project Income

AGWA Regional program Export Growth Partnership Project - Growers Grant IWTG Income Account

2021 $

2020 $

30,415 99,829 26,002 718,266

45,091 56,560 530,098

874,512

631,749

Wine Industry Association of Western Australia Inc. Notes to the financial statements 30 June 2021 Note 4. Grant Expenses 2021 $ AGWA Regional Program Contractor fees - Growers Group Export Growth

2020 $

30,415 11,971 99,829

45,091 56,560 -

142,215

101,651

2021 $

2020 $

5 513,257 319,154

14,752 38,823 85,973 242,318 110,250 43,064

832,416

535,180

2021 $

2020 $

119,038 16,321 (3,166) 11,396

115,000 10,925

143,589

125,925

2021 $

2020 $

285,561

592,788

Note 5. IWTG Expenses

Collaboration Project Management Product Development Integrated Promotion Scoop Project Regional Support

Note 6. Employee Benefit

Wages & Salaries Expenses LSL Expense Annual Leave Provision Superannuation

Note 7. Cash and cash equivalents

Current assets Cash at bank

Wine Industry Association of Western Australia Inc. Notes to the financial statements 30 June 2021 Note 8. Trade and other receivables 2021 $

Current assets Trade receivables GST Receivable

2020 $

63,249 13,058

208,757 (10,426)

76,307

198,331

Note 9. Property, plant and equipment 2021 $

Non-current assets Office equipment - at cost

2020 $

1,832

Note 10. Intangibles

Non-current assets Prepaid APC Establishment Less: Written down Expense on Prepaid APC Establishment Wines of WA Brand Less: Accumulated amortisation

2021 $

2020 $

37,427 (37,426) 1

19,477 (19,476) 1

Note 11. Trade and other payables 2021 $

Current liabilities Trade payables PAYG Withholding Payable Superannuation Liability

2020 $

1,030 2,400 1,496

2,148 1,379

4,926

3,527

Wine Industry Association of Western Australia Inc. Notes to the financial statements 30 June 2021 Note 12. Contract liabilities

Current liabilities AGWA Regional Progam Growers Group Grant (R4R) Growers Grants Industry Co-fun Export Growth Partnership IWTG

2021 $

2020 $

80,789 140,126 -

61,204 58,717 17,285 60,000 418,266

220,915

615,472

2021 $

2020 $

2,935 23,168 (23,168)

1,397 12,549 (12,549)

2,935

1,397

Note 13. Borrowings

Current liabilities Credit Card Other payroll Liabilities Salary Package - Novated Lease

Note 14. Provisions 2021 $

Current liabilities Annual leave Long service leave

2020 $

14,436 16,321

18,045 -

30,757

18,045

Note 15. Retained surpluses 2021 $

2020 $

Retained surpluses at the beginning of the financial year (Deficit)/Surplus for the year

152,680 (48,511)

52,561 100,119

Retained surpluses at the end of the financial year

104,169

152,680

Note 16. Constitutional Requirements Under the Constitution, if the Association is wound up, any property of the Association that remains after satisfaction of the debts and liabilities of the Council and the costs, charges and expenses of that winding up,that property shall be distributed to another incorporated association having similar objects to those of Association for charitable or benevolent purposes .At the date of this report it would appear that there is no intent to have the Association wound up.

Wine Industry Association of Western Australia Inc. Notes to the financial statements 30 June 2021 Note 17. Events after the reporting period The impact of the Coronavirus (COVID-19) pandemic is ongoing and while it has been financially positive for the incorporated association up to 30 June 2021, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided. No other matter or circumstance has arisen since 30 June 2021 that has significantly affected, or may significantly affect the incorporated association's operations, the results of those operations, or the incorporated association's state of affairs in future financial years.

Note 18. Reconciliation of (deficit)/surplus to net cash (used in)/generated from operating activities 2021 $

2020 $

(Deficit)/Surplus for the year

(48,511)

100,119

Change in operating assets and liabilities: Decrease/(increase) in trade and other receivables (Decrease)/increase in trade and other payables (Decrease)/increase in contract liabilities Increase in employee benefits

145,508 (11,465) (394,558) 12,712

(158,764) 14,080 241,114 442

Net cash (used in)/generated from operating activities

(296,314)

196,991

WA Wine Industry RD&E Strategic Review Workshop Summary Thursday 19 January 2017

5 year priorities Smoke taint Chemical resistance Improved clonal material (including alternative varities) Business model innovation Pest and disease management Sustainable viticulture

Challenges & Opportunities

Survey responses

Regional winemaking practices Pest and disease management Utilising genetics Poor quality clones

Clonal selection Smoke taint Alternative varieties Organic viticulture Chemical resistance

Regional Program (Extension) Incubator (Research) Priorities Priorities Poor quality clones Regional winemaking practices Alternative wine varieties

Utilising genetics Pest and disease management Business model innovation

Western Australian Wine Industry Strategic Plan 2014–2024

This Strategic Plan is the result of a wide-ranging strategic review of the Western Australian Wine Industry in consultation with industry participants and stakeholders in late 2013. Industry fully supports the plan and gives the state peak body, Wines of Western Australia (WoWA), and Regional Associations, the mandate to implement this bold and ambitious strategy.

Executive Summary

Vision

A Western Australian Wine Industry that grows sustainably and profitably, built on the reputation of its great fine wine regions.

Objective

The fine wine regions of Western Australia are recognised as some of the best, most distinctive and pristine in the world.

Pathways to success

A unified, focused, proficient and strategically influential industry. Regional fine wines of provenance and authenticity.

Mission

Develop a unified, influential voice to create opportunities for the fine wine regions of Western Australia. Work in partnership with national industry and government bodies to strengthen Western Australia’s position as the pre-eminent regional fine wine producing state in Australia.

Charter

Wines of WA provides stewardship of the industry. Regional Associations are the custodians of their regional brands.

This Strategic Plan sets out an agenda of 10 strategic focus areas with objectives, initiatives and timelines. The strategy will achieve these objectives by working to maximise and align the existing and potential resources of industry and government at the national, state, regional and local levels. The plan ensures a long-term strategic direction while taking immediate action on priority issues. WoWA will establish Working Groups to address the strategic focus areas and develop actions and key performance indicators (KPIs) to pursue the linked objectives.

Strategic focus areas 1.

Form a unified industry structure

Industry needs a unified voice to effectively harness and co-ordinate the available resources of industry and government in the best interests of the industry’s future. Industry will form a unified structure with WoWA and Regional Associations. WoWA and Regional Associations will formalise their roles, responsibilities and relationships.

Industry-wide funding for state and regional bodies

The organised industry structure needs secure funding to be effective. WoWA will work with industry to develop an industry-wide secure funding model and canvas its introduction with industry. 3.

Grow the demand for regional fine wines in domestic and international markets

The industry will pursue the strategic market development plans of regions in partnership with industry and government. The plans will align with national industry strategies but will focus on regional fine wines and key domestic and emerging Asian markets.

•

Doubling exports to $100 million in the next three years.

•

Increasing WA’s regional fine wine share of key domestic markets.

•

Re-engaging with North American, UK and European markets.

•

WoWA advocacy, co-ordination of effort, representation and policy formulation.

•

WA’s regional fine wines to become the wine of first choice for WA consumers.

•

Regional Associations promote and market regional brands, identify and address local issues.

•

Greater focus on marketing fine wine regions from Wine Australia Corporation (WAC) internationally over the coming five years.

•

A Wine Australia Office in Perth that has export development resources co-funded by WA’s federal levies to WAC, the State Government and the WA Wine Industry.

To achieve these targets, industry will seek to extend the WA Wine Industry International Marketing Plan to a value of $5 million over the next five years and include a domestic strategy that aligns with these targets.

Focus on regional fine wine production

Western Australia is predominantly a fine wine producing state. Industry will work collectively to grow the reputation of our fine wine regions and their capacity to deliver. Targets include: •

Developing a critical mass of successful producers in each region united behind a clearly articulated regional identity.

•

These producers achieve national and international recognition for their wines, which is measurable through show results and other formalised review systems (Parker, Halliday, Langton’s).

•

Increased and co-ordinated industry-relevant RD&E efforts to improve grape and wine quality, improve winemaking and reduce costs of production.

•

Investigating profitable fine wine business models and existing successful fine wine regions around the world that focus on sustainably profitable fine wine production.

Expand wine and food tourism

Targets include:

Core functions include:

Regional Associations will develop strategic and marketing plans in a collaborative manner ensuring resources are utilised efficiently while achieving the greatest impact.

The industry needs to capture the unrealised tourism opportunities and synergies between the food and wine sector for mutual benefit. Initiatives include: •

Partnering with the tourism and food sectors at state and regional levels.

•

Alignment with national industry strategies to expand domestic and international wine and food tourism.

Improve engagement with RD&E

The industry needs to make better use of the RD&E resources available to benefit from the rapid adoption of relevant research and innovation.

•

Developing an industry self-funding mechanism for biosecurity and consult with industry on its implementation.

Improve industry environmental performance and sustainable use of natural resources

Initiatives include: •

Collaborative RD&E programs with industry, government and university partners that support the strategic objectives for fine wine production, environment and sustainability, biosecurity and market development.

•

Co-ordinated RD&E efforts to build industry capacity in focus areas including grape and wine quality, cost of production, winemaking and pest and disease management.

•

Strengthened industry framework to better identify and address state and regional RD&E priorities.

Improve industry biosecurity and enhance our clean and green competitive advantage

The industry will work to continuously improve its environmental performance, improve access to suitable land and water and adopt practices that lead to the sustainable use of natural resources. Initiatives include: •

Disseminating information about the community’s environmental expectations and government demands for sustainability.

•

Facilitating access to tools and resources that assist the wine industry to continuously improve its environmental performance.

•

The industry will develop and implement biosecurity plans in collaboration with government and relevant cross-sector industries.

Improving communication and information flow between industry and government on the management and access to limited natural resources, such as suitable land and water.

•

The plans will pro-actively protect industry’s low pest and disease status and enhance its clean and green competitive advantage.

Promoting RD&E to support sustainable environmental practices in viticulture and winemaking.

Social responsibility and health

Initiatives include: •

Developing and implementing biosecurity plans for the Western Australian wine industry through the Guard system.

•

Undertaking an education campaign to increase industry awareness and participation on biosecurity issues.

•

Implementing on-farm biosecurity practices to monitor for pest and disease threats and provide surveillance for early detection and response to potential threats.

WA sends more than 50% of our exported wine into Asia and about a third of this is into China.

The industry and individual grape and wine businesses will pro-actively promote responsible wine consumption in our markets. Industry will support and engage in relevant public health initiatives at national and state levels, collaborating as required with WFA. 10.

Taxation

The industry should continue to work with WFA on tax policy to ensure that profitability for WA businesses is assured under any amendment to the WET system or any future taxation regime. 09

Western Australia is the pre-eminent regional fine wine producing state in Australia. The industry faces increasing competition from many other Australian regions and the world. This Strategic Plan informs what the Western Australian Wine Industry should now do to ensure a profitable future.

Pathway to Success

The pathway to success for the Western Australian Wine Industry is through: •

a unified, focused, proficient and strategically influential industry

•

regional fine wines of provenance and authenticity.

The Strategic Plan enables the Western Australian Wine Industry to grow in value, profitability and sustainability by building on the reputation of its great fine wine regions. It positions the industry to capitalise on new opportunities to become more profitable, target future growth, encourage investment and achieve the collective goals of the WA Wine Industry. The industry will work in partnership with industry and government to align and maximise the resources to create opportunities for the fine wine regions of Western Australia.

Quality code

Through consultation with the wine industry and associated stakeholders a number of priorities and strategic focus areas have been identified that will be the starting point for action.

Fine wine definition The definition of fine wine in the strategic review was based on the Australian wine industry quality segmentation of grapes and wine developed by WFA. The five segments (A, B, C, D, E/F) are defined on price: The definition of fine wine includes the A and B quality segments which make up icon, ultra-premium and super-premium wines. There was some debate within the WA industry that under this price definition of quality the domestic price for fine wines is A$20/bottle and over.

Wine quality segment*

Grape price (A$/tonne)

Domestic retail price (A$/bottle)

Export FOB price (A$/litre)

Icon and ultra-premium

>2,000

>30

>10

Super-premium

1,501–1,999

15–30

7.50–9.99

Premium

601–1,500

10–15

5.00–7.49

Popular-premium

301–600

7–10

2.50–4.99

E/F

Commercial

<300

<2.50

Bulk wine is allocated to its own quality segment, under $1/L to E/F, and more than $1/L to D. * Adopted from Lokshin, Rabobank 21

Strategic Focus Areas and Initiatives Forming a cohesive industry structure

Strategic Framework

•

Formalise state peak body and regional associations’ roles and relationships.

•

Compile core principles and policies.

•

Develop strategic and marketing plans for each region.

Creating funding certainty for the peak body and regional associations

•

Develop an industry-wide, sustainable funding model.

•

Consult with industry on the structure of a wine industry-specific funding model.

•

Canvas industry on introducing an industry-wide funding model.

Growing consumer and market demand

•

Develop a collaborative marketing plan to increase consumer demand for the fine wine regions of WA in domestic and international markets.

•

Double WA wine exports to $100 million in the next three years.

•

Make the fine wine regions of WA the first choice for WA consumers.

Focusing on fine wine production

•

All wine regions achieve high reputation and high capacity to deliver fine wines.

•

Investigate and adopt successful wine business models for WA.

•

Investigate fine wine industry regions that focus on quality and value to provide guidance for the adoption of regional fine wine models in WA.

Expanding the wine and food tourism market

•

Develop collaborative programs with the food, tourism and government sectors.

Strategic Focus Areas and Initiatives Innovative research, development and extension

•

Develop collaborative RD&E programs that support strategic objectives.

•

Co-ordinate, engage and adopt industry-relevant RD&E.

•

Establish a framework to better identify and address state and regional priorities.

Enhancing industry biosecurity

•

Develop and implement biosecurity plans for the WA wine industry.

•

Increase education of biosecurity issues for industry.

•

Promote adoption of on-farm biosecurity practices.

•

Develop an industry funding model for biosecurity.

We stand at the dawn of a broader view that generic Australian marketing themes are a thing of the past.

Environmental performance and sustainable use of natural resources

•

Improve understanding of environmental issues and performance.

•

Improve access to suitable land and water for viticulture.

•

Promote RD&E in sustainable environmental practices.

Responsible consumption of wine

•

Promote responsible consumption of wine.

•

Contribute to the national alcohol debate in line with WFA policies and research.

Taxation •

10 •

Work towards more ethical and equitable future taxation arrangements. Maintain tax rebates for regional communities.

The Strategic Plan to 2024 will guide relationships within the Western Australian Wine Industry and between its industry, government and other partners over the next 10 years. The plan proposes major changes to how the industry is structured and operates in the short and medium term.

Action

Industry will review progress after 6 months and 12 months and revise the plan to include any major changes and improvements. This plan ensures a long-term strategic direction, while allowing action to be taken by WoWA and the Regional Associations on current issues.

Where a priority is identified and there is an existing industry or government body dealing with the issues, WoWA will nominate someone to participate as a wine industry representative. Proposed Working Groups are: 1.

Industry Structure and Funding (SFA 1 and 2): WoWA and RAs

WoWA as the state peak industry body will pursue specific issues referred to in strategic focus areas, objectives and initiatives included in this document.

Market Demand and Consumer Interaction (SFA 3, 4, 5 and 10): RAs, WoWA, Industry members

Implementation

Innovation, RD&E, Extension and Biosecurity (SFA 4, 6, 7 and 8): Wine Industry Technical Committee

Regulation and Social Responsibility (SFA 9 and 10): WoWA, RAs.

Priorities

The proposed implementation plan (see following) indicates the order of priority, industry representational structure and allocation of operational responsibility in pursuing the strategic priorities.

Form working groups WoWA will form working groups to address the priority strategic focus areas and develop action plans to pursue the linked objectives. The Working Groups will comprise industry members and draw on other resources where skills and expertise are required to ensure there is capacity to achieve the objectives in each strategic focus area (SFA). Membership will be determined by WoWA and each group will be accountable to WoWA. There may be issues that have been identified as priorities in the strategic plan that do not require a working group to be formed. It may be possible to combine some of the remaining priority issues into broader themes to be covered by a single working group.

Where cross-overs of priority issues between Working Groups are found, they would collaborate as required.

Review of working groups WoWA will develop a set of key performance indicators (KPIs) for each Working Group. The progress and continued status of each group will be reviewed by WoWA with reference to these KPIs.

Review of industry strategic plan The new Wine Industry Strategic Plan will be reviewed by WoWA and RAs at six months and 12 months following its ratification, and annually thereafter. The review will include assessment of WoWA’s operations, each Working Group and an update of the priorities to be pursued in the following year. 37

Strategic Focus

Implementation Plan

Level of representation and priority State High

Medium

High

Development of Strategy, MOUs; ratify and incorporate to constitution

Develop regional business plans and MOUs

Conduct poll and develop MOUs

Develop regional business plans and MOUs

3 and Partnerships

Advocacy for Funding

Regional

Strategy and execution of tactics

Local Medium

High

Execution of tactics

Medium

Strategic Focus

Level of representation and priority State High

Regional Medium

High

Local Medium

High

Medium

Moderate process and generate data to develop FWBM criteria

Input to process, define regional identity and foster a critical mass of producers

Advocacy for Funding and Partnerships

Development and execution of tactics

Advocacy for Funding and Partnerships

In-region advocacy for relevant research and extension

Advocacy for Funding and Partnerships

On-ground surveillance for incursions and identifying possible threats or practices

Advocacy and management of Technical Committee

Support for in-region implementation of best practice operations

Develop state-specific policy paper and lobby to ensure contents are implemented

Support for in-region implementation of best practice operations

Develop state-specific policy paper and lobby to ensure contents are implemented

Communicate policy to members, feedback up to state body

Input to process, defining regionally-specific expressions of fine wine

Execution of tactics

Support for in-region implementation of best practice operations Support for in-region implementation of best practice operations

Execution of tactics

Strategy

Comments

S1T1 - WoWA will support wine regions to grow international wine tourism and collaborate with state/national agencies and wine, food and tourism sectors to foster alignment.

WoWA provided administrative/project management for all Grant activities for 36 months. This included: - a dedicated resource on contract from June 2018 to June 2020 ($50,000 total) - WoWA CEO and Independent Chair for duration of Grant (totalling 1248 hours @$93.75 = $117,000 as per project schedule) The Wine Tourism Alliance (WTA) was established at the start of the Grant. See Terms of Reference here. The WTA is comprised of regional wine representatives, WoWA, Regional Development Commissions (SWDC), Regional and Local Tourism Organisations (RLTO) and Tourism WA (TWA).

S1T2 - Establish a legacy for collaboration, this may include a WA wine/food/tourism alliance.

S1T3 - Develop an over-arching collaboration map identifying gaps, linkages and areas to align.

Expenditure

Allocated expenditure utllised noting WoWA CEO time from June 2020 to June 2021 provided in-kind as grant funding fully utlilised. Estimate an additional $36,000 provided in administrative support. Allocated expenditure utilised.

The WTA met nine times providing input and oversight of activities and will continue as the collaboration/engagement vehicle for WA wine producers and the above tourism stakeholders. WoWA CEO will meet with TWA, RLTO and SWDC in mid-June to discuss structure and Terms of reference for WTA going forward

Note all WTA participants provided time, travel/accommodation expenses in-kind. Average of 8 people/meeting at $640 each = $46080

See collaboration map here

Allocated expenditure utilised

Wines of Western Australia PO BOX 2091, Claremont North WA 6010 T– 9284 3355 F – 9284 2199 E – winewa@winewa.asn.au W – www.winewa.asn

Completed through Australia’s South West Project. Outputs ongoing and will continue into the future but specifically related to this strategy include: S1T4 - Build greater collaboration across the regional wine tourism sector through alliances, partnerships and initiatives to deliver better experiences for wine tourists.

Review of audit finding to inform workshop format and specific areas of focus Development of trade ready/bookable experiences in all regions. These featured in collateral outlined below. Consumer brochure (The Wine Adventurer) featured on TWA consumer platform – see here

The Wine Adventurer (also translated to Mandarin and Japanese on the WoWA site here The Wine Adventurer on the Scoop Digital site here Trade/Media pack – see here TripAdvisor campaign x 2 – see overview and results here of first campaign. Second campaign completes on 30 June. Note the hub is an

evergreen site to be utilised by WA wine producers . Engagement with trade and in-market TWA offices to build awareness of tools

Completed through Australia’s South West Project. Outputs ongoing and will continue into the future but specifically related to this strategy include: - The Wine Adventurer 10-day itinerary across all eight WA wine regions - The Wine Adventurer trade/media kit - TripAdvisor campaign x 2 - UK promotion in the Times – see placement here S1T5 - Foster inter-regional collaboration and develop in-region alliances to cross promote and extend wine tourism opportunities.

Expenditure utilised via ASW project.

Allocated expenditure utilised

A South West/Great Southern Development Commission led initiative which includes: -

In-bound trade group to 2019 Gourmet Escape in collaboration with TWA – see attendee list here and see itinerary here 2021 Pinot Picnic festival in Southern Forests – see report here Margaret River on Tour in Singapore. To be completed by 30 June. Cancelled due to Covid lockdown. Funding allocated to in-region provenance project to

Wines of Western Australia PO BOX 2091, Claremont North WA 6010 T– 9284 3355 F – 9284 2199 E – winewa@winewa.asn.au W – www.winewa.asn

Allocated expenditure utilised

develop promotional collateral for international promotion of Margaret River as fine wine tourism destination. See summary here. Truffle Kerfuffle festival in Southern Forests. Deliver TK hampers with Wine Adventurer trade and consumer magazine to 90 key travel trade and media in Singapore. Report to be finalised after event (June 25 – 27 2021) Support ETS implementation: speakers, VIP tickets, video live-streaming, project management. Awaiting final report.

Note that in the original strategy this was to be an in-bound program (as per Gourmet Escape group) but is now focused on implementing domestic events which are delivered virtually to international audiences. As per original strategy, target markets are Singapore/SE Asia. As a result of this realignment, S1T5/T7, S2T7 are delivered as an aggregated set of events/projects. Allocated expenditure utilised.

S1T6 - Optimise regional wine tourism plans by aligning priorities across regions and supporting regional outcomes.

All eight regions undertook strategic planning supported by Grant funding. Agknowledge conducted workshops with seven (noting Margaret River was provided funding to undertake their own strategic planning process focused on communications/marketing) and produced strategic plans that were subsequently ratified by each region. See outputs here.

S1T7 - Identify international in-market and domestic inregion (eg. Ni Hao WA) promotional events/trade platforms and partner with agencies to gain international exposure for WA wine regions.

See comments above at S1T5

Wines of Western Australia PO BOX 2091, Claremont North WA 6010 T– 9284 3355 F – 9284 2199 E – winewa@winewa.asn.au W – www.winewa.asn

Note all strategic planning participants provided time, travel/accommodation expenses in-kind. Average of 9 people/meeting at $800 each = $57600

S2T1 - Conduct an audit and gap analysis of WA’s wine tourism regions to identify the capacity, investment priorities for international wine tourism readiness/commissionable product.

Three service providers were utilised to deliver this strategy: - Tourism Research Australia conducted regional audits of the Great Southern and Swan Valley. A review of outputs determined that a greater focus at individual business level would be a better use of remaining funds - Wine Tourism Australia conducted an initial capacity building program and followed these up with mystery shopper reviews of wine tourism businesses in an opt-in process. Results were used to create business specific mentoring sessions. -

S2T2 - Provide wine tourism experiences, sales skills and QA training and tools at cellar doors. This funding was re-allocated to Regional video series

S2T3 - Build a business case for innovative linked winery experience loyalty programs at cellar door, regional and state levels to drive visits. Re-allocated to ASW project.

Allocated expenditure utilised.

Remaining funds were allocated to ASW project to inform workshop format and specific areas of focus.

see outputs here.

Project delivered by IMG and WoWA (project management). Regional video series featuring James Halliday WA correspondent Erin Larkin and Fervor Foods founder Paul Iskov. Nine 3-minute videos (two for Margaret River) featuring food and wine experiences in a road trip/Wine Adventurer format were produced. Additional shorter clips for social media placement were also developed. See outputs here. Distribution to date: - Distribution to all Regions - IMG in promotions for Gourmet Escape 2021 - Provided to TWA and RTO for use in promotions and social media

Wines of Western Australia PO BOX 2091, Claremont North WA 6010 T– 9284 3355 F – 9284 2199 E – winewa@winewa.asn.au W – www.winewa.asn

Allocated expenditure utilised.

S2T4 - Regional Activities: target in-region food festivals to better promote local regional wines, link events with wine media famils opportunities.

Delivered by SWDC and ASW project. Outputs include: - In-bound group for Gourmet Escape, visited all WA regions - Rob Geddes visit alignment to Pinot Picnic, visited all WA wine regions. - TWA food and wine promotional program into UK market – see detail here - TWA/WA Trade Office (WATO) support/promotion of Pinot Picnic in Singapore – see detail here - TWA/WATO support for ETS in Singapore and Malaysia - TWA/WATO support for Truffle Kerfuffle in Singapore and Malaysia

Allocated expenditure utilised.

Margaret River Wine Region

Branding Video – “Breathless” see here.

Allocated expenditure utilised.

Geographe Wine Region

Development of resources for use in promoting the Geographe Wine Region. Utilising Wine Australia Wine Connect platform and Social Media Platforms, focus on promoting Geographe in the Singapore/UK market. Use collateral developed from Grant funding (ASW digital assets, images and regional video). To be completed.

Allocated expenditure utilised.

Modernise the re-branding and signage of the Geographe Wine Region.

Allocated expenditure utilised.

Develop Regional Branding Video, implementing activation in Singapore and UK via Wine Connect. To be completed Photo/video library development and support, web development, social media (supporting the state-wide digital package).

Wine Industry Southern Forests

Event Development in the Southern Forests. In partnership with the South West Development commission the Southern Forests Food Council, Local Tourism Organisation, create/implement/leverage culinary event festivals. Engagement of neutral wine professional hosts to converge food, wine and target group. This has been completed through: -

Creation of Pinot Picnic, a regional festival focusing on regional varietal hero Pinot Noir and Southern Forests food and tourism experiences. See project

reports here.

Wines of Western Australia PO BOX 2091, Claremont North WA 6010 T– 9284 3355 F – 9284 2199 E – winewa@winewa.asn.au W – www.winewa.asn

Allocated expenditure utilised. Allocated expenditure partially utilised, noting that funding has been allocated across all three projects. Allocated expenditure utilised, noting that funding has been allocated across two projects

Leveraging Truffle Kerfuffle to feature Southern Forests via hampers to tourism trade/media and live streaming wine/truffle experience in Singapore

Increasing the Southern Forests Customer Experience Collaborative planning to grow international wine tourism. Funding not utilised to date. Re-allocated to TripAdvisor State Campaign Research and strategic planning to inform the development of wine tourism strategies, collateral (images. videos, media packs) and align with Local Tourism and ASW to promote region.See project plan here.

Blackwood Region

Develop resources to promote the Great Southern as a region for wine tourism: support state-wide development of a library of quality images/videos by ensuring quality Great Southern image content (S3T4).

See library here.

Great Southern Wine Producers Association Inc

In-market promotions/Events in the Great Southern. Given travel restrictions, this was implemented through: - support for events (Taste Great Southern) - promoting wine tourism experiences via targeted social media/digital PR - Leveraging ETS to feature regional content via live-streaming into Singapore/Malaysia

S2T5 - Support tourism operators with current wine industry information, consistent key messages, regional narratives, translations.

Funding not utilised to date. Re-allocated to TripAdvisor State Campaign Allocated expenditure utilised.

Allocated expenditure utilised.

Delivered via ASW project. Outputs include: -

Consumer brochure (The Wine Adventurer) in English, Mandarin and Japanese featured on WoWA website, Scoop.com and TWA consumer platform – see here Trade/Media pack – see here TripAdvisor campaigns – see overview and results of first campaign here. Note the hub is an evergreen site to be utilised by WA wine producers . Engagement with trade and in-market TWA offices to build awareness of tools

Wines of Western Australia PO BOX 2091, Claremont North WA 6010 T– 9284 3355 F – 9284 2199 E – winewa@winewa.asn.au W – www.winewa.asn

Allocated expenditure utilised.

S2T6 - Work with iconic WA foods and high profile chefs for endorsement of wine and food pairings to promote regional culinary tourism experiences and media coverage.

Delivered via ASW project. Outputs include: -

S2T7 - Create an annual international wine tourism event, alongside a wine technical symposium or international wine show event. Note that the ETS was scheduled to run alongside Emergence Creative, an existing regional festival but this was cancelled due to Covid lockdown related risks, S3T1 - Build and implement an integrated communication strategy to drive growth of WA wine and culinary tourism.

S3T2 - Develop/support consistent messaging to promote WA wine regions to target markets, using Wine Australia geographical indicators. Regional wine and food experiences, assets.

Note that the ETS was scheduled to run alongside Emergence Creative. an existing regional festival but this was cancelled due to Covid lockdown related risks. The event occurred over two days – 13/14 June. See event report here and event website here. Delivered through strategic framework provided by Ian Thubron (see here) and ASW project which includes: - The Wine Adventurer consumer magazine and trade/media kit - TripAdvisor campaigns - TWA UK wine/food activation see overview here This has been implemented by Scoop and the ASW project as below: - Scoop utilising their international/national consumer data-base to feature WA wine and food events and regional/producer stories and events. Leverages the Localista guide and WoWA/Regional Wine Association digital platform. See -

S3T3 - Partner with a provider to develop a comprehensive suite of fully integrated digital

Consumer brochure (The Wine Adventurer) featured on TWA consumer platform – see links above Trade/Media pack – see links above TripAdvisor campaign –see links above. Note the hub is an evergreen site to be utilised by WA wine producers. Engagement with trade and in-market TWA offices to build awareness of tools

report here.

ASW outputs including The Wine Adventurer, TWA UK wine and food activation Regional events including Pinot Picnic, Taste Great Southern, Truffle Kerfuffle and ETS Further integration with TWA/RTO marketing campaigns will evolve develop as markets open for travel.

Completed by Scoop Digital, the platform now includes: - See WoWA website for entry point to platform here Wines of Western Australia PO BOX 2091, Claremont North WA 6010 T– 9284 3355 F – 9284 2199 E – winewa@winewa.asn.au W – www.winewa.asn

Allocated expenditure utilised.

marketing tools using the latest technologies to promote WA wine tourism across multiple platforms.

S3T4 - Identify gaps then partner to develop a digital portfolio of images, video, fact sheets to support media, regional promotion, events, publications, web content.

the WoWA, Swan Valley, Margaret River, Blackwood Valley. Geographe and Great Southern websites. All sites utilise the Localista Guide (see here) The platform has mapping and trip building technology and a suite of digital marketing tools. All of the platform is translated to Mandarin. Note that all 350+ WA producers are now listed in the guide. Only 150 were listed on ATDW when the project started. Localista now links to ATDW and monthly feeds/updates ensure that WA wine tourism products.

See project overview here

Winery content creation / editing / translation ($300 each) Completed by Scoop Image / video library shoot / coordination completed by ASW, Regions and IMG Regional Video. Note that all collateral is currently being consolidated into media library. To be completed by 30 June 2021. See ASW developed collateral here. Branding / copywriting / translation for industry websites completed by Scoop Creation of ancillary region-specific content completed by Scoop Content distribution and integration (100+ sites)

S3T5 - Identify key points of influence for international visitors and implement attraction strategies (airports, in-market media coverage etc.).

Joint project with TWA to develop and deliver a unique international tourism wine experience offering, leading with the Margaret River brand and building exposure for all WA wine regions. See strategy here with list of activities below: -

2019 Gourmet Escape In-bound (in partnership with SWDC as noted above) Tasting Australia with Aiden Quinn featuring Margaret River here and Great Southern here IMG Regional Videos as noted above see here

Wines of Western Australia PO BOX 2091, Claremont North WA 6010 T– 9284 3355 F – 9284 2199 E – winewa@winewa.asn.au W – www.winewa.asn

Allocated expenditure utilised. Allocated expenditure utilised. Allocated expenditure utilised. Allocated expenditure utilised. Allocated expenditure utilised.

Allocated expenditure utilised.

OMD was not implemented because of Covid (was scheduled for March-April 2020). Replaced with TripAdvisor and TWA UK activation noted above Qantas Magazine mixed media campaign see project summary here

S3T6 - Explore in-market retail opportunities for promotion/product delivery: visit WA collect wine on return.

Project completed by RooLife concurrently with S4T2. See link to report below at S4T2

Allocated expenditure utilised.

S4T1 - Invest in accessing existing and new research and share information to inform regional wine tourism investment decision making.

Linked to S4T6, noting research on current international tourism trends will need to focus on largely unknown factors. Project to be completed by Stepladder Consulting and will utilise current research on emerging trends to develop a road-map for future investment and product development. Focus will be on regional champions identified in ASW project and on leveraging the assets and linkages to TWA developed by ASW project and other grant activities. See project scope here.

Allocated expenditure utilised

S4T2 - Conduct a supply chain feasibility program for improved/more economical wine delivery options for visitors.

Project completed by RooLife. Note further work/support for other projects delivered including Pinot Picnic/ETS. See report here.

Allocated expenditure utilised.

S4T3 - Enhance the consumer value of wine tourism using digital/social media metrics to identify popular attributes of wine tourism and create actual and perceived value for international wine tourists using digital tools.

Scoop Digital provides regular reports on website traffic through the WA wine platform and its broader network. See report at S3T3.

Allocated expenditure utilised.

Given lack of air traffic into WA, this activity has been re-allocated to ASW project focusing on tourism trade, TWA/WATO in-market offices and promotions. Link to RooLife Perth Airport app will be leveraged as travel recommences

Allocated expenditure utilised.

S4T4 - Identify/negotiate air travel partners for inmarket promotion and packaging of wine and culinary tourism options.

Wines of Western Australia PO BOX 2091, Claremont North WA 6010 T– 9284 3355 F – 9284 2199 E – winewa@winewa.asn.au W – www.winewa.asn

S4T5 - Identify and build a cohort of regional wine tourism champions/leaders to advocate for continuous improvement. Create a virtual creative cluster to support regular contact. S4T6 - Manage ongoing monitoring and evaluation of international wine tourism initiatives across regions to inform future investment.

Delivered by ASW. Trade bookable wine tourism experiences have been established in each region and will be utilised as regional champions to lift awareness of travel trade/media, consumers and to lift regional aspirations.

See summary of evaluation with recommendations for further actions to drive development of wine tourism capacity across all WA wine regions.

Wines of Western Australia PO BOX 2091, Claremont North WA 6010 T– 9284 3355 F – 9284 2199 E – winewa@winewa.asn.au W – www.winewa.asn

Allocated expenditure utilised.

19 July 2021

Wine Export Growth Partnership: ‘WA Wines to the World’ ANNUAL REPORT 2020 - 2021 Overview WA WINES TO THE WORLD is an industry led $6 million 5-year program running from July 2021 with 50% matched funding support provided by the Department of Primary Industries and Regional Development (DPIRD). Co-contribution can be from any industry organisation including, but not limited to, Wine Australia, Wines of WA (WOWA), regional associations and wine exporting levy payers (wine producers). Prior to the commencement of the program, Hydra Consulting was engaged to work with an Industry Steering Group appointed by WOWA to establish the program to undertake the following services: • Act as a face of the project to build relationships, identify opportunities for funding and sector relationships • Confirmation of participating partners • Export resource matrix development • Confirm/validate target markets • Preferred supply chains identification • Create and initiate a market development and communications strategy In addition, as the engagement of Hydra Consulting was a deliberate effort to accelerate the commencement of the program, $115,000 was released to early launch activations once it was clear that there were opportunities that should be urgently addressed. Outcomes To date WA WINES TO THE WORLD has achieved the following: • Development of the program through consultation/engagement with industry and stakeholders at all levels – including wine producers, regional associations, WOWA, Wine Australia, Australian Grape & Wine, Department of Primary Industries and Regional Development (DPIRD) which includes South West and Great Southern Development Commissions, WA Govt Trade Offices, Austrade/TradeStart, Tourism WA and private sector service providers. • Confirmation of 65 participating industry partners at July 7, 2021 with capacity to provide matched funding. This number is continuing to grow as more producers become aware of the program structure and approach to participation. • Development of the WA Wine Exportal at www.winexportal.info, a website for program participants that currently provides a collation of industry and government resources for exporters, plus information and registrations of interest for all program activations. • Confirmation and validation of six primary target markets. • Preferred supply chains identification. • Created and initiated a market development and communications strategy as a series of activations and a flexible participation model. • Accessed additional funding through sponsorship for maintaining/upgrading web resources. • Accessed additional funding through the Entrepreneurs’ Programme for US market entry training and resources. 1

Program structure The overall delivery model for WA WINES TO THE WORLD is industry participation in a series of activations that are agreed by the Industry Steering Group on an annual basis. These collaborative export market activations are available to any Western Australian wine producer to participate in. Some of these are national activations in which WA WINES TO THE WORLD is enabling a high level of WA participation and influence. The governance of the program is through an Industry Steering Group appointed by WOWA and the WA Government. The 7-person Industry Steering Group is responsible for overseeing the program, ensuring the whole of the WA wine sector is engaged, and appointing and overseeing the Program Manager, as shown below.

Details of activities INDUSTRY ENGAGEMENT Industry engagement activities have included: 1. A WA industry-wide engagement survey to identify participants, preferred markets, preferred channels and preferred activations – this has been used to build the initial email lists, as a primary input into market identification, selection of preferred supply chains and market activations design. 2. Information sessions about the program (held in Perth, Albany and via Zoom). 3. Dedicated program EDM’s through WOWA, as well as EDM’s via regional associations and stakeholder organisations. 4. Continuous engagement by the Program Manager with a range of WA, Australian and international stakeholders including wine producers, regional associations, Wine Australia, Australian Grape & Wine, DPIRD, WA Govt Trade Offices, Austrade/TradeStart, Tourism WA and private sector service providers. The engagement survey asked participants to identify themselves, commit to the program and state preferences for target markets, sales channels and market activations. We have received 65 survey responses from 62 wine producers and 3 regional wine associations. The survey is ongoing and results are being updated as we add new participants to the program. 2

A detailed summary of responses can be found via the link above. Note that there is good alignment between the survey results and Hydra Consulting’s recommendations arising from the Export Market Analysis and Supply Chain Analysis. WA WINE EXPORTAL An online resource for Western Australian exporters was established at www.wineportal.info. At launch it contained information for exporters to improve their export journeys and access a range of industry and government resources. It has since been updated to include information about all activations being developed under WA WINES TO THE WORLD. In addition, sponsorship has been obtained from Hillebrand to support keeping the website active and continuously updating and maintaining the information provided to producers. EXPORT MARKET ANALYSIS Hydra Consulting has undertaken a detailed Export Market Analysis, based on matching the Western Australian (WA) wine industry with export market opportunity, taking into consideration such factors as producer size, premium pricing, key varietals grown etc. We have taken WA’s top 15 export markets by value (using Wine Australia export data for the 12-month period to 30 September 2020) and analysed each against the following criteria: • Overall market size and volume of Australian wines exported • Value of WA wine exports, specifically >$7.50/L AUD FOB • Export growth performance over the short term (12 months) and long term (5 years) • WA’s % share of total Australian exports (low share = opportunity) • Level of market participation (number of WA levy payers active within an export market) • Whether it is a key tourism market for the state/regions • Whether it is a KOL/influencer market (comprising high profile international wine media) • Focus markets for primary stakeholders – Wine Australia, Austrade and DPIRD • Ease of doing business re regulatory and cultural environment • Preferential tariffs and FTAs in place, and • Political stability. Note that, whilst we originally worked on the basis of export data for the 12-month period to 30 September 2020, the figures were checked and adjusted (where material to outcome) against data for the period ending 31 December 2020. No weightings were applied to the above criteria, as this was considered too subjective, but a simple tally of the final results has been presented to initially ‘score’ the export markets. That said, China has been immediately dismissed as a potential market given the significance of the temporary tariffs applied, overall political tensions/instability and the government imperative to find alternative export markets. SUPPLY CHAIN ANALYSIS Hydra Consulting concurrently conducted a detailed Supply Chain Analysis, to identify the following: • Most significant sales channels • Viable alternative sales channels • Trade, consumer and influencer engagement and activation opportunities • Specific problems and solutions that exist for each particular market, and • Examples of key buyers/operators. 3

It was important that we consider the supply chain directly alongside target markets, especially in the context of COVID-19 and the increased significance of off-premise channels, the meteoric rise of online/eCommerce models, new ways of engaging (more directly) with trade and consumers, challenges with conventional transport, as well as new approaches to logistics, distribution and fulfillment. APAC MARKET ‘DEEP DIVE’ Considering the large number of markets initially identified as potential targets (8), it became clear that we needed to dig deeper to ultimately refine the list and focus resources. At the same time, we felt that emerging APAC markets could represent a unique opportunity for WA wines for the following reasons: • Smaller emerging markets are less competitive, therefore WA Wines to the World could potentially make a bigger impact in such markets. • Ability to achieve better return on investment, as a result of the above. • Ability to work directly with Austrade in priority APAC markets (where considerable investment is being focused through the government’s Agribusiness Expansion Initiative). Given the above, Hydra Consulting has taken a ‘deep dive’ into the 12 top performing APAC markets (including the 5 Asian markets identified as potential targets in the Export Market Analysis). Here we looked specifically at the following (>$7.50/L AUD FOB): • WA wine exports by $/L • WA wine exports by 4 key varieties (SBS/SSB, Cabs/blends, Shiraz/Syrah and Chardonnay) • WA wine exports by 2 key red varieties (Cabs/blends plus Shiraz/Syrah) • Australian wine exports overall and looking specifically at Cabs/blends, and • Export growth performance over the short term (12 months) and long term (5 years). Here we focused on red wine performance, given the need to find alternative market(s) for reds previously destined for China. When looking at Australian export performance in these markets, we narrowed in on Cabernet Sauvignon and its blends purely because of relevance to WA’s specific strengths. FINALISATION OF TARGET MARKETS The Industry Steering Group subsequently identified the following markets as the priority markets and allocated budgets for 2021/22 as follows. Hong Kong is identified as a target market, but the preferred activation will not be available until 2022/23 so is deferred until that time. Other APAC markets are identified for potential ad hoc activations in the short term. Market / Description Global (relates to all markets) United Kingdom (UK) Unites States of America (USA) Japan Singapore Canada Hong Kong APAC/Other TOTAL

Total Budgeted Spend $126,390 $429,924 $407,051 $15,224 $185,900 $47,751 $0 $0 $1,212,240

Net Program Cost $63,195 $211,515 $203,525 $7,612 $92,950 $23,876 $0 $0 $602,673

Budgeted Net Cost % of Total 50% 49% 50% 50% 50% 50% NA NA 50%

Budgeted Share of Spend 10.49% 35.10% 33.77% 1.26% 15.42% 3.96% 0.00% 0.00% 100.00%

MARKET DEVELOPMENT & COMMUNICATIONS PROGRAM The market development and communications strategy has been created as a series of activations. The following description documents have been prepared and are linked: 1. Global market activations 2. USA market activations 3. UK market activations 4. Japan, Hong Kong, Singapore and Canada market activations The activations have been specifically designed around the existing availability of WA wines in markets and positioning of WA wines in those markets. There are program design elements covering existing exporters, new-to-market opportunities, premiumisation of the WA category, on-trade, off-trade and eCommerce channels and consumer engagement. The off-trade propositions range from specialty retailers to major chains. PRE-PROGRAM ACTIVATIONS In addition to identifying 2021/22 activations, we brought forward $115,000 expenditure into 2020/21 to get the program off to an early start. The early activations commenced before July 1, 2021 and are either underway or complete: 1. Obtaining access and providing support for up to 10 companies to enter Wine Australia’s US Market Entry program – commenced. 2. Development of Australian Wine Discovered educational program for the Great Southern Region contracted to Wine Australia – underway. 3. Australian Wine Connect Regional Features for each of Margaret River, Great Southern and Geographe through Wine Australia – booked and commenced. 4. Australian Wine Connect Curated Collections for Margaret River, Great Southern and Geographe – booked and commenced. 5. Australian Wine Connect expo space subsidy for up to 32 WA producers – commenced. 6. Procurement of Wine Intelligence global consumer data for WOWA and communicating to producers – commenced. 7. Initiation of the development of educational assets for the whole of Western Australia by Hydra Consulting and external writers – initiated. 8. A 2-page feature advertorial in Harpers Wine & Spirit (UK trade publication), featuring WA International Wine Competition winners – completed. CAPABILITY DEVELOPMENT With additional funding support from the Entrepreneurs’ Programme, we were able to provide tailored US market entry/familiarisation training for 16 companies either participating in Wine Australia’s US Market Entry Program or who were interested in entering the US market in the next 12 months. Training was delivered via 4 separate Zoom workshop sessions of 2 hours each and participants were provided with extensive support materials post workshop.