What does the future hold for English wine?

The story of Britain being the fastest-growing wine region globally has been widely covered in the press over the past few years.

Currently, there are over 890 vineyards across Britian, and more than 195 wineries. The area of planted vineyards in the UK has quadrupled since 2000. 

Challenges in a competitive landscape

What is less understood is what the future will look like for the sector. The British wine market is incredibly competitive, putting pressure and uncertainty on margins. How will wine businesses pivot their pricing, sales channel, and brand strategies to be perceived as offering good value while maintaining a sustainable competitive advantage within an increasingly commoditised market?

We've seen several wine businesses position themselves in a wide gap in the market by producing low-cost sparkling wine with the Charmat Method, which targets price-sensitive customers. This marginal business model works for businesses that can produce very high volumes of wine.

It's unlikely to be suitable for those that have already invested in infrastructure for making sparkling wine traditionally, have limited production capacity, or have built a brand that caters to the higher end of the market.

The art of value creation in wine businesses

Conversely, there is a strategic move to create a competitive advantage by increasing the product's perceived value or the experience of enjoying the product. Vineyards are a rich canvas to create an experience-led hospitality business for consumers.

From a business model perspective, it optimises bottle sales through the cellar door channel at full retail price and is one of the most effective ways of growing a business.

Beyond vineyards: the rising value of wine businesses

As existing wine organisations develop and new entrants join the market, the value of wine businesses is quickly surpassing the asset value of their planted vineyards and built wineries. This requires a highly-specific valuation capability and a deep understanding of the cash requirements. Our winery investment consultants are proven market leaders in offering winery business investment and sale advice. 

Grant funding is available for all viticulture sectors, from start-ups to well-established businesses looking to expand. Our unique grant funding service has access to 9,000 public and private grant funding opportunities. This knowledge enables grant funding to be developed as part of business plans and proposals.

Knight Frank's Viticulture team, Ed Mansel Lewis and James Osborn

Sustainable solutions

We understand the importance of sustainability, which is why we've partnered with Zestec Renewable Energy. We provide clients with a zero-capital outlay solar PV solution with no maintenance costs.

This vineyard and winery solution produces cheaper, greener power which reduces energy bills and supports ESG objectives, with a big step towards net zero ambitions.

How Knight Frank can help

Our expert team offers unique and market-leading opportunities from our products and services through land and property advice, geospatial-led vineyard solutions and the creation of outstanding visitor destinations.

We have developed a client-led service that is recognised as a more sustainable and profitable commercial platform for future growth of British wine estates. It creates a higher-value wine business, opportunities for diversification and retail solutions that reduce reliance on lower-margin trade channels.

Find out more about Knight Frank's Viticulture team