The maker of Penfolds was slogged by 175% tariffs in its biggest market...so now it's time to focus elsewhere.
Background: Treasury Wine Estate is one of the world's largest wine companies. It makes Penfolds (for the classy readers), Wolf Blass and 19Crimes (for the Snoop Dogg aficionados).
What happened: In March 2021, China whacked a tariff of 175% on Australian wines. This meant wines became a WHOOOOLE lot more expensive for Chinese consumers.
What else: It's been a rough year for Treasury - but now it's all about Treasury's resurrection! It wants to refocus its business on other Asian countries and diversify its customer base (think: Vietnam, Thailand, Malaysia and Japan).
💡A key element of having a successful business is having a diverse mix of customers. Ya know 'dont put your eggs in one basket'. Previously, Treasury Wine’s strategy was focused heavily on China and its rapid growth.
💡 But once the tariffs were introduced, Treasury’s Chinese revenue dropped from $78 million dollars to $2m for the last 6 month period.
💡So now, Treasury Wine is investing in other Asian countries to pick up the slack.
Sign up for Flux and join 100,000 members of the Flux family
