Special report: China-bound wine merchant Dawine is buying Wine Depot, a high-tech wine trading platform positioning itself to digitally transform the wine supply chain.

It’ll let Dawine (ASX:DW8) get into the business-to-business wine sector both here in Australia and in China.

Dawine sells Australian vino into China, a tricky market for newcomers but with a burgeoning wine-drinking population.

Wine Depot is launching a smart logistics platform specifically for wine which will allow sellers to source inventory from multiple suppliers and have their product orders delivered directly to the consumer.

Its founder, Dean Taylor, is set to become the new Dawine chief executive after the deal is done.

Mr Taylor is also the founder of Cracka Wines, Wine Ark and My Wine Guy.

“We are really excited to work with Dean and acquire Wine Depot, which will provide an integrated trading and logistics platform that the wine industry sorely needs,” said Dawine chairman Piers Lewis.

The deal is entirely in scrip, with Dawine paying 83.3 million shares priced at 0.6c, making the entire deal worth just under $500,000.

More wine, faster

The concept behind the platform is a smart logistics network made up of existing warehouses and new depots, which can provide faster and cheaper wine deliveries and the ability to buy by the bottle — rather than having to purchase an entire case.

The problem is fragmentation, an issue in Wine Depot’s stomping ground of Australia and New Zealand and Dawine’s nascent market in China.

Mr Taylor says the old supply chains, dominated by distributors with high-cost warehouses, can’t provider the range of wines people want, the price or the speed of delivery.

“Over the last ten years there has been an enormous shift in the way that consumers buy wine. The online and direct-to-consumer segment is the fastest growing part of the market,” he said.

“Our aim is to provide the wine industry with a ‘smart logistics’ platform that allows sellers to access inventory from thousands of suppliers and drop ship orders directly to consumers from strategically placed ‘depots’.

“Totally agnostic, our ‘depots’ will allow liquor retailers to focus on acquiring, retaining and servicing customers – leveraging our technology to take care of inventory management, fulfillment, customer communications and service.”

Taking the idea to China

The Chinese wine market grew 50 per cent last year, making it a $1 billion market for Australian wineries.

“China is a logical starting point for the global roll out of our ‘smart logistics’ solution,” Mr Taylor says.

“It’s an emerging market with no legacy wine distribution infrastructure, dominated by just a handful of well-known wine brands. Providing a platform that allows thousands of other Australian and New Zealand wine brands to access and develop a presence in that market is exciting.”

Demand for Australian wines is booming in Asia but the supply chains just aren’t able to connect producers and consumers directly, Mr Taylor says.


This special report is brought to you by Dawine.

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