Wine to Taiwan

(Last updated: 21 Nov 2011)

Trends and opportunities

The market

 
In 2010, the wine market was around 15 million litres valued at around US$84.7 million. Australia accounts for about 10.4 per cent of the import wine market by dollar value after France (51.3 per cent), followed by the US (9.9 per cent) and then Chile (8.7 per cent).

The average price per litre of exports to Taiwan from France was US$8.24 per litre, which is higher than average price (US$6.01) of the total Australian wine to Taiwan. The average price from France had been much lower than from Australia before for years. The main reason is the greatly reduced volume imported of low price French Vin de Pays and regional AOC Bordeaux, while the premium wine segment from Bordeaux and Burgundy remains strong. In particular, the average price to Taiwan from Burgundy is more than US$18 per litre.

The low price segment market share is now filled by Argentinean, Chilean and Spanish wines. The wine from these countries has more similarity to Australian mid-price range wines than French wines, therefore creating strong competition in market.

(Source: Bureau of Foreign Trade website database, September 2010)

Opportunities

The consumer behaviour in Taiwan has led to an M-Style society. Middle price range (FOB A$80–A$250 per case) has become the most difficult segment and therefore requires more effort to be successful. Today, consumers are either willing to pay for the most premium/famous wines, or buying as cheap as possible wines from supermarkets and hypermarkets.

While the low price wines (FOB A$30–A$80 a case) still remain the largest sales volume, this segment has been dominated by Chilean and Argentina wines due to the strong Australian dollar and higher production cost of Australian wines. Thus the premium range (FOB A$250+), and limited release and collectable items have become the most important segments for Australian wine producers and Taiwanese importers..

Competitive environment

The local taste preferences are very complicated, but are strongly influenced by French wine growers and the US media, such as Wine Advocate, Decanter and Wine Spectator. The wine choices in Taiwan are vast, as retailers will sell different brands of wine at different price segments and competition is very strong.

Tariffs, regulations and customs

All imported wine must follow the Tobacco and Alcohol Administration Law published in 2000.

Current applicable wine tax and tariff is as follows:

• Wine tax – NT$7 (A$0.25) for each percentage point of alcohol per litre
• Import tariff – 10 per cent for wine and 20 per cent for sparkling wine and port
• Sales tax – 5 per cent (GST)

(Source: Directorate General of Customs, Republic of China)

Industry standards

All wines exported to Taiwan need to meet the chemical standard test provided by recognised laboratories (such as NATA).

Marketing your products and services

Market entry

The wine market in Taiwan is quite well segmented and successful exporters have clearly segmented their product range accordingly to meet buyers' and importers' preferences. The market in Taiwan has five clearly defined segments (FOB are per case price):

• Entry level range (FOB A$30-A$80 per case)
  • Mostly available in supermarkets, department stores, convenience stores, restaurants, and night clubs
  • Very competitive wine range but is the largest market
  • Mainly dominated by French and Chilean wines
• Middle to premium range (FOB A$80-A$250 per case)
  • Available in restaurants, hotels, and selective bottle shops
  • Most competitive segment for Australian wines – many wine labels for selection from all countries
  • Consumers of this segment have good income, knowledge of wine and eager to try different wines and varieties
• Ultra-premium range (FOB A$250+ per case)
  • Available mostly at fine wine shops, fine French or Italian restaurants, premium clubs, and VIP wine direct distribution channel
  • Retail in Taiwan at A$80-$300
• Collectable range
  • Examples are wines listed in Langton Classification and high Wine Advocate rating wines

Market preference

( > mark means greater preference)

Wine body/structure preference:

• Red >> White, 48% volume is from Cabernet Sauvignon (and blends) 
• Full body and big > Medium >> Light body 
• Warm climate > Cooler climate. However Cool climate wines is growing
• French oak > American oak 
• International Media’s Reviews from Wine Advocate, Decanter, Wine Spectator are essential in addition to local reviews 

Wine bottle and label design preference:

• Slim or reserve taper (Italian and Bordeaux) >>> Short, light bottle
• Natural cork > Synthetic & DIAM & Screw cap  but the acceptance is improving
• Metal bottle neck > Plastic bottle wrap
• Wood box > Lay down paper case > Stand up paper case

Distribution channels

Wine is distributed through importers by various means. Ultra premium wines are mostly sold directly to consumers without going through any channels, or in some boutique wine shops. Middle and low price wines are mainly distributed by wine retail shops, some premium supermarkets, restaurants and pubs.

Links and industry contacts

Wine–related resources

Cognac House – www.cognac-house.com.tw A local premium online order dealer
Wine – www.wine.com.tw Premium wine importer specialising in French and Californian wine

Australian resources

Australian Wine and Brandy Corporation (AWBC) – www.wineaustralia.com