AAWE, Economics Dept, New York University, 19 W 4th St, 6Fl., New York NY 10012aawe@wine-economics.org

AAWE Working Paper No. 84 – Business

 

INNOVATION IN WINE SMEs: THE PORTUGUESE DOURO BOYS

Dorli Muhr and João Rebelo

Abstract

Globalization is challenging the very core of organizations and firms’ strategies in the traditional European wine regions characterized by a terroir orientation, whose context shows that their wine small and medium enterprises (SME), are probably unwilling and unable to produce large and low-cost, standardised quantities of wine, with the sales supported by heavy marketing campaigns. The main aim of this paper is to present a business strategy that can be adopted for wine SME located in regions with high production costs and where tradition and terroir are relevant factors, to be introduced in the decision process. To achieve this goal, it is presented the case of five small wine producer-bottlers, located in the Portuguese conservative Douro Demarcated Region (DDR), that are developing an innovative approach through the adoption of an informal horizontal network nominated Douro Boys. The analysis conducted in this work allows us to conclude that we are in the presence of a very simple and informal structure of prospectors, with a high culture of innovation, searching niches in international wine markets.

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