Wine to Japan

(Last updated: 26 Sep 2008)

Trends and opportunities

The market

Australian export of wine to Japan reached almost one million cases in 2007. Australia is the fourth largest exporter by value to Japan, following France, Italy and US in the same year. The average export price is A$5.43/L FOB.

The merit of screw cap has been largely accepted by Japanese consumers. Australian major individual wine brands are simultaneously moving to screw cap in Japan and premium wine producers are following. 

The import of Australian bottle wine accounts for 77 per cent of the total volume of Australian wine exports, while cask (Bag-In-Box) makes up the remainder at 23 per cent.

Sales of sparkling wines in Japan show a 17 per cent increase by volume. The import of Australian sparking wine has shown rapid growth, almost 50 per cent increase over two years. 

Newly established international hotels are generally proactive about introducing New World wines in their restaurants.  

There are several factors that will boost Australian wine exports over the longer term:

• The main driver will be consumer awareness of Australian wines. As Australian wines gain a good reputation in other overseas markets such as the UK and USA, Japanese perceptions on Australian wines will change - there is a positive flow-on effect.
• As the retail price of imported wines has dropped, perceptions of wine have changed from solely for special occasions to more daily consumption habits. This has driven an increasing consumer consciousness of price and quality and overall education about wine. Japanese consumers are increasingly becoming aware of what medals and awards signify in this area.

There are two major segments in the Japanese wine market: 'price fighters' and discount wines. These have a retail price at ¥380-¥880 for 750ml bottle and are mainly distributed through large-scale retail outlets such as supermarket chains, ‘casual’ food service outlets and are sold by full container loads.

The next category is ¥1000-¥1500, where the challenge is to demonstrate cost performance
against French and Italian wines in the same category. Premium wines for special occasions, when supported by ratings, awards, and reputation retail at ¥1500-¥3000 and above and are distributed through specialised wine outlets, upper-tier hotels and restaurants.

Tariffs, regulations and customs

Wine imports must adhere to the Food Sanitation Law. Customs duties and liquor tax apply, depending on the product. However, there are no quota restrictions on wine imports. Customs counsellors can answer questions and offer advice via email. Customs duty and liquor tax are broken down as:

• Customs duty:
• Still wine – ¥125 per litre or CIF 15 per cent, whichever is less
• Sparkling wine – ¥182 per litre
• Fortified wine – ¥112 per litre
  
  
• Liquor tax:
• Fruit wine – ¥56,500 per kilolitre
• Sweet fruit wine (alcohol strength less than 13 per cent) – ¥98,600 per kilolitre
• Sweet fruit wine (alcohol strength 13 per cent or above) – ¥98,600 plus ¥8200 for each per cent alcoholic content above 13 per kilolitre

Industry standards

A business licence issued by the Japanese Tax Office is required to import and wholesale wine. Please contact the Austrade Japan offices for details.

Marketing your products and services

Market entry

The Japanese market is attracting continuous approaches from the various wine exporting countries throughout the world. To successfully market into Japan, consider the following:

• Define the market area that your wine would target, and research that market and price points.
• Appoint a partner in Japan. Select a local partner, either an importer or distributor, with a competitive advantage in the distribution channel which suits your product segment. 
• Be creative, unique and have a long-term commitment to be successful in this market.
• Market strategies need to differentiate your product against other Australian, local and international wine brands, which are being introduced in growing numbers. Competition is also with other popular alcoholic beverages such as beer.
• Keep in mind Japanese consumers are increasingly price and quality conscious so it is important to support your locally based partner and maintain constant communication.
• Participate in targeted wine promotions in department stores and retail outlets. Credentials such as awards are also useful promotional tools in Japan.

Internet wine sales are a developing area. While a growing number of local liquor or wine specialist shops are opening online shops, it's yet to be determined how much it will contribute to overall sales. Some major wine importers and manufacturers have also established their own websites. However, at this stage they are regarded more as a public relations tool than a sales tool.

Distribution channels

The Japanese distribution system is becoming more efficient, but wholesalers still play an important role in making frequent small-lot deliveries to retail shops with limited storage space.

Your sale volume objectives, along with the positioning of your product, will be key factors when considering suitable distribution channels. Some major retail chain stores source wine directly from overseas or domestic wine suppliers to increase efficiency in distribution.

Traditional distribution methods are:

• Importers or manufacturers > wholesalers > retailers or the food service industry
• Specialist wholesalers with strength in particular channels and regions
• Major national wholesales covering various channels and regions

Links and industry contacts

Wine–related resources

Wine Australia Japan
Tel: +81 3 5367 3301
Fax:  +81 3 5367 3303
Web: www.wineaustralia.com/japan

Japan Wines and Spirits Importers Association
Tel: +813 3503 6505
Fax: +813 3503 6504

Government, business and trade resources for Japan

Alcoholic Beverage Tax Division, Indirect Taxation Department
National Tax Administration Agency
Tel: +813 3581 4161
Fax: +813 3593 0406

Food Sanitation Division, Environmental Health Bureau
Ministry of Health, Labour, and Welfare
Tel: +813 3503 1711
Fax: +813 3503 7965  

Australian resources

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

Japan External Trade Organization (JETRO) Sydney – www.jetro.go.jp/australia 
Level 25, Gold Fields House
1 Alfred Street
Sydney NSW 2000
Tel: +61 2 9276 0100

Japan External Trade Organization (JETRO) Melbourne – www.jetro.go.jp/australia/melbourne/index.html
Level 21, 101 Collins Street
Melbourne VIC 3000
Tel: +61 3 9654 4949
Fax: +61 3 9654 2962