Managing export success – An empirical picture of German wineries’ performance

Export represents an important strategic lever for enterprises to reach new clients, to diversify, and to participate in regional economic growth. An online based survey invited more than 800 wine experts to assess wine export success factors as well as the performance of German producers. The questionnaire tested a literature based success factor framework with the four success factors. The experts assessed the relevance of the levers for the wine industry and the performance of German producers. Respondents judged all four success factors as well as all underlying 27 criteria to be relevant in the wine industry. Export strategy receives highest value of the success factor rating. The survey depicts a heterogeneous performance of German producers comparing the success factors but a homogeneous performance for all the underlying criteria within each success factor. The responses reveal a performance gap for the success factors export commitment and export strategy. For the success factor export knowledge German producers apparently overperform. Export programs are of importance and in the case of Germany apparently meet the needed level of support and activity. The results thereby support empiric findings in the context of cultural differences of different nations. The study provides orientation for German wine producers but also small and medium enterprises of


Introduction
Export management is highly important in the context of practice and science.Especially for companies characterized by stagnating domestic markets and growing foreign markets, export -as strategic option -offers an enormous potential to increase sales and profits.Thus, the scientific interest in exports management is respectively strong.The query in a relevant search engine shows 3.7 million hits for the term "export management" -which exceeds those for "strategic management".Nevertheless, the comprehensive literature concerning export management also hints at its challenges, especially for smaller enterprises [1].In order to lead export activities to success, it is necessary to consider and to manage many success factors with interdependences and situational effects [2].The scientific publications afford a further penetration of export management itself as well as the validation of structural models for the explanation of success factors.
This paper is based on an empirical study within an export-intensive industry.Global experts were polled about success factors in general and the capability of German providers in the wine industry.The increasingly industrialized wine world appears to be a good example for having a closer look at success factors in exports.One of the main aims of this study was to find out, how German providers who are marked by small-scale structures and fragmentation manage to survive in global competition.Therefore, the study contributes to the subject matter of small and medium-sized companies' export management.Due to the increasing competitive ness within the domestic market, as well as the simultaneous growth of population and wine consumption in foreign countries, German providers regard wine export as an enhancement of sales opportunities.Thus, the acquisition of knowledge appears to be highly essential for the practice, since the successful market cultivation necessitates a professional management of the relevant success factors.

Export as strategic vehicle
Export is the company's economic activity, in the course of which goods and services are sold across frontiers.Transnational trade harks back to the origins of commerce and is an established phenomenon of international economic interaction.Germany's permanent export excess and revenues in the amount of more than 800 billion Euros testify the high demand for German products and the export sector's relevance -although China has superseded Germany as world export champion firstly in 2009.The increasing globalization, the effort to reduce international trade barriers, as well as the permanent reduction of transport charges lead to further growth and future prospects for the companies to supply products, goods and services also beyond the national frontiers.For primary products the export sector is equally important.They represent more than a fifth of world trade and often display non-reproducible, local characteristics which are demanded in other countries.These demands can only be satisfied by export.Due to the "terroir" and the local product features, this applies also to wine [3].Furthermore, the wine production necessitates climatic requirements, which cannot be met in many countries [4,5].Thus, the global wine market is a relevant, persistent and sustainable phenomenon.For German providers export

Marc Dressler
Ludwigshafen University/DLR Rheinpfalz, Professor for Business & Entrepreneurship, 67435 Neustadt/Weinstraße, Germany Abstract.Export represents an important strategic lever for enterprises to reach new clients, to diversify, and to participate in regional economic growth.An online based survey invited more than 800 wine experts to assess wine export success factors as well as the performance of German producers.The questionnaire tested a literature based success factor framework with the four success factors.The experts assessed the relevance of the levers for the wine industry and the performance of German producers.Respondents judged all four success factors as well as all underlying 27 criteria to be relevant in the wine industry.Export strategy receives highest value of the success factor rating.The survey depicts a heterogeneous performance of German producers comparing the success factors but a homogeneous performance for all the underlying criteria within each success factor.The responses reveal a performance gap for the success factors export commitment and export strategy.For the success factor export knowledge German producers apparently overperform.Export programs are of importance and in the case of Germany apparently meet the needed level of support and activity.The results thereby support empiric findings in the context of cultural differences of different nations.The study provides orientation for German wine producers but also small and medium enterprises of other industries.

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offers the possibility to win new markets and consumers, to benefit from emerging markets and to circumvent local competition.

Literary review
Due to its high economic relevance, export attracts profound scientific interest.Since export is a classical strategic option for the opening up of new markets and risk diversification, the literature on export management primarily arises from the departments strategy or marketing [6,7].Export success factors are multivariate, interdependent and result, therefore, in complex management challenges [8].The existing meta-analyses on success factors show that even for the single dependent variable "export success" many different indicators may be used (e.g.growth, market share, amount of export countries, sales in the destination country, etc.) [9,10].In the scientific context a variety of relevant, but partly specific or situational success factors and barriers are primarily structured according to companyinternal and exogenous factors [2].In the case of external circumstances both the country of origin and of destination are considered.The structural models, developed in the context of the meta-analyses, were advanced by Cavusgil and Holzmüller and validated by holistic and empirical considerations.These structural models serve as a basis for this study and the questionnaire for this purpose.However, the structural circumstances of the wine industry, including fragmentation and small-scale companies, need to be considered.Correspondingly, the scientific papers on export and SMEs (Small and Medium Enterprises) are also taken into account.Seringhaus and Julien have examined and adapted the export structure models for the SME-area [1,11].They have illustrated the challenges for small-scale companies with respect to the success factor "information".This reveals the relevance of coordinated export support for small companies [12,13].A structural model by Ali and Shamsuddoha on success factor research in the export sector with the factors "export knowledge", "export commitment", "export strategy" and "export promotion program" has proven empirically relevant, encompassing, and serves as the foundation of our survey [14].
Australia dominates in the range of wine-industrial publications on export [15][16][17][18][19].Besides that, the literature is shaped by many case studies [20,21].In this context the entrepreneurial challenges are displayed with both positive and negative examples.The scientific consideration of cluster approaches as success factors for the regional added value is another focus [22][23][24].Frequently, the export success of emerging nations in the scope of wine industry is taken as an illustration for the fact that economic development handicaps can, indeed, be eliminated [25].Indeed, concerted cooperation between companies and institutions has been recognized as decisive for success.
One of the empirical studies ascertains the perception of consumers of different wine export destinations concerning a variety of producing countries [26].The existence of "country-image effects" and their manifestation for wine is proven for the exemplary countries Australia, Chile, USA, South Africa and France.Consumers connect country-specific wine images with the countries of origin [27].In this context, they distinguish not only between the old and the new wine world, but also between different countries of production within the new wine world.Since that study does not include Germany as a country of production, the results of this survey are supposed to provide an insight into competitive advantages and disadvantages due to the perception of Germany as wine exporter.Maurel examines internal and contingency factors and their influence on export success by the example of French wine exporters [28].Besides company size, export orientation and commitment as well as innovations have a positive effect on the export success.All studies emphasize that, due to its emotional utility, wine requires entrepreneurial commitment and the consideration of the foreign customers' expectations in order to achieve sustainable export success.Thus, commitment, knowledge, strategy and export promotion are said to have a strong influence on the export success in the wine industry.Therefore, these factors were examined in the context of this study.

Global perspective
The wine market is global -this applies to both production and demand.Around the world roughly 7.5 million hectares are used for winegrowing and approximately 250 million hectoliters of wine are produced every year [29].The cropland decreases, starting from a historical maximum of more than 7.9 million hectares and profits of 300 million hectoliters [30,31].The purpose of this supply reduction is the prevention of an excess supply, since the annual consumption amounts to approximately 243 million hectoliters.After a continuous increase of consumption -for instance from 226 million hectoliters in 2000 to 255 million hectoliters in 2007 -and a subsequent decrease, the consumption seems to reach a plateau on the contemporary level.Nevertheless, the first impression of a stable market is deceiving, since there are massive changes with diverging regional developments opposing this semblance.While the cultivation and the production volume is decreasing in the "old wine world" -including the European countries with a long production history, such as France, Spain and Italy, the new wine producers, like China, Chile and New Zealand, enhance their capacities and output.Thus, Europe's global production share has decreased from 75% to approximately 65% [30,32].
Simultaneously, there are extensive structural changes on the demand side.In order to assess the market potential and the demand for wine, it is important to consider not only the consumed quantity as a whole, but also the per capita consumption.With average values of about 50 liters, France and Luxembourg are, despite their decreased per capita consumption, still global frontrunners.Italy and France show the highest consumption, which can be attributed to the high average consumption as well as the number of citizens.The countries with an intensive consumption illustrate the massive structural changes in the global wine market.Since 2000, the wine consumption in Italy and Spain has decreased extremely relating to the market volume.Nevertheless, globally emerging markets for wine benefit from the increasing intensity of wine consumption and from the demographic growth.Those countries, which are characterized by a growing population 03001-p.3 and prosperity, are considered very attractive for export nations, since they hold out hope of an increasing wine consumption.The rising purchasing power of great parts of the population leads to an increasing relevance of wine as a good with the purpose of satisfying needs.Due to its consumption increase of about 40% since 2000, the USA now belongs to the three most important consumption countries world-wide.The increase of market volume in China of about 67% and in Russia of about 50% illustrate the extent of structural deferrals [31].
Even in producing countries, the demand for wine is not solely satisfied by regional products.As a result, 40% of the worldwide wine production is crossing national borders, corresponding to a merchandise volume of more than 25 billion Euros [33,34].Regarding the volume the global wine trade has grown by 60% and by 80% regarding the value [35].Producing countries with growing production capacity and quality are taking over the markets.This extends to countries with a strong expansion in the course of the last years, whose production surpasses its own market's potential, such as New Zealand.The decreasing internal demand in the dominant European producing countries France and Italy and the resulting need to export the available goods, trigger the pressure within the international competition.
Additionally, the growing globalization, the influence of new technologies and media and the decrease of transport charges will lead to a further increase of the international wine exchange.The intensive global exchange of wine is a result of the consumers' interests and, therefore, the demand for wine with foreign origin [36].This applies to countries without wine production, as well as to those, producing wine themselves.E-Commerce and the influence of new media change society as well as communication and organisation cultures.The emotional advantage of wine is not only mediated and enhanced by personal contact, but also via the internet or the technical infra-structure.Furthermore, growing tourism influences the global exchange of goods [37][38][39].Besides the extension of market potential, the globalization also affects the products.International product styles are developed with the result that the wine can be sold in different markets.
Those trends will shape the further globalization of wine industry in the short and medium term.Certainly, more emerging markets with sales potentials will establish, coming along with deferrals of demand.The professional management of risks connected with export, as well as the realistic judgment of potential ensure the sustainable export success.

German wine trade
Despite the massive structural changes, including a continuous market withdrawal on the part of small producers, the German wine industry is still characterized by smallscale companies [40].The slight concentration on the supplier side has negative effects for the global competition.Lage, globally acting wine companies dispose of market power, global sales networks, high professionalism, international market knowledge and advantages in accessing financial markets [41,42].Additionally, the higher delivery capacity of large amounts of wine leads to a good bargaining position.This is exemplified by Yellowtail, an Australian product by the Cassella Winery, which is distributed all over the world.In less than 15 years more than one billion bottles of this newly created brand have been produced [43].
While statistics report export successes with a volume of about 4 million hectoliters [44], these data may not be equated with a growing market success of German viniculturalists, since they include also the reimportations, which represent more than the half of the export volume.Germany has evolved into a hub of the wine industry [45].The major export destinations are Great Britain, the USA and the Netherlands [46].Nevertheless, the net export decreases.This recession is attributable to the smaller harvest in Germany, which leads to the effect that less goods are available for the export.Thus, possible demands may not be satisfied.
With the help of a lot of commitment and persuasiveness, the foreign prejudice that German wines were "sweet and inferior" has, certainly, been eliminated, so that German wine can now satisfy high quality claims, again [47].The increasing price development of net exports is interpreted as evidence for the risen quality perception of German wine in foreign countries [46].In this context it should be considered that even for those wine producers who are already established in the international trade the export business is very challenging.Certainly, the dominant market share of German products in the Norwegian wine market can be regarded as an exemplary success and another evidence for the commitment to create a new image for German wine.However, Great Britain illustrates the challenges of the global competition, since there, German wine is losing its dominant position of the past, which is attributable to permanent market share losses.Cheaper modern wine from the new wine-producing countries replace the German wine there.
Especially the exhaustion of possible market potentials in the export is very challenging for many direct marketers, because often conditions of size cannot be satisfied or they lack of infra-structure or experience.In the survey, 40% of the direct marketers stated that they did not export [48].These empirical results testify a realistic assessment of export risks and challenges.Despite a high theoretical market potential, the access to stagnating or decreasing markets appears not to be expedient, since the providers cannot present a unique characteristic simply due to the wine or the brand.However, countries with a strong growth offer an attractive market opportunity for German wine.Especially the local cutthroat competition and the challenges of a sufficient differentiation motivate an increasing activity in order to exhaust market potential in foreign countries.In this context, it should be ensured that the necessary success factors for a sustainable control of emerging markets are mastered.

Empirical insights on wine export success factors
In 2013, a study was carried out, in the course of which experts should examine and judge the relevance of the success factor scheme introduced in the literature for the wine industry.Furthermore, they should judge the performance of German providers concerning those success factors.
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Design and methodology of the survey
The foundation of the study was a structural model including four success factors [14].These factors were prompted both concerning their relevance for the wine industry and the performance of German providers.The success factors are export knowledge, export strategy, export commitment and export promotion programs.For every success factor there were defined certain wine-industrial setting levers.Altogether, 27 variables were prompted.The judgment of the factors' relevance for the wine industry generate scientific findings concerning export research.
A pretest with some viniculturalists with export experience, which preceded the online-survey, led to an extensive overwork of the questionnaire.According to the experts, the request of company characteristics as influencing factors for the export performance was not expedient for the success factor analysis [49].The questionnaire with the four success factors and the subordinate setting levers was judged positively.In the second pretest of the online survey, the questionnaire was largely approved.Furthermore, it became apparent that some of the acting parameters needed to be briefly explained.
The questionnaire included four questions on the success factors.Every success factor was prompted with six to seven parameters.In this context, the relevance of the factors for the wine industry and the providers' performances were surveyed with the help of a scale of 1 to 5 (1 = not relevant; 5 = highly relevant).Besides that, the addressees were asked to give information about their profession, their country of origin and a self-assessment of their expert level for German wine.
In order to ascertain the anonymity and confidentiality, the survey was divided into two steps.More than 800 wine experts from all over the world were invited to participate in the study.The contacted people covered many different spectra: sommeliers, importers, wine agencies, professors and training staffs with scientific connections to wine-specific departments.

Study results
The survey resulted in 39 applicable questionnaires and a response rate of 5%.In this respect, it should be considered that almost 100 addressees were not accessible.The misallocation of those mails was mainly attributable to career changes, which can be seen as an evidence for the fast pace of the international wine trade.The experts who participated in the survey, descended from 10 countries.Most of the responses came from experts from the Netherlands, followed by the USA and the UK.Besides the Scandinavian countries, also China, Switzerland, Belgium and Canada were represented.The own expertise was generally highly valued (90% level 4 or 5).A third of the addressees were importers, further 30% were journalists and 17% were professional wine experts.
For the success factor "export commitment" [50] six parameters were prompted.The highest relevance was attributed to the development of a network, followed by the entrepreneurial commitment.The setting levers innovation, financial resources, human capital and participation in export activities were regarded as equally important.Due to the German providers' export activities, the addressees judged their capability as high.In general, the addressees' assessments testified a potential for growth in the area "commitment", especially concerning the setting lever "network".
For the survey of the success factors "export knowledge" different competence fields, according to the analysis of literature, were used: forensic framework, culture, knowledge of the market, consumers, sales requirements, competition and knowledge management [51].The experts judged the relevance of the seven setting levers approximately equal.The knowledge of forensic backgrounds was regarded as highly important.
The "export strategy" as a success factor was prompted on the basis of the factors brand, merchandising, marketing policy, price management, target segments, adjustment of supply and the storyline [6,52].All these parameters were judged as important, but supply adjustment and price management were considered the most relevant.The

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widest performance gaps appear with reference to the setting levers supply adjustment, brand and storyline.
The success factor "export promotion" has an indirect effect, since the collaborative promotion, activities, communication and network establishment in the countries of destination or, alternatively, the support of local companies lead to a sales promotion [12,53,54].Thus, the wine providers cannot benefit from this factor before an infra-structure is established and institutional or organisational circumstances are given.In this context, export promotion programs can involve diverse benefits.There are seven service areas which were considered in the survey.The mediation of information and an image referring to the country of origin (1) in the destination countries aims at the conveying of unique features and characteristics in order to arouse the interest of importers, multipliers and consumers.The study reveals that the consumers connect certain expectations with wine from different countries of origin.However, specific characteristics of wine regions (2) and characteristic grape varieties (3) are used for a differentiation within the wine industry.The great variety of investigations on positive effects of wine and tourism (4) justify another prompted service area of export promotion.The establishment of a usable network (5) was additionally prompted [26,27].Besides that, two service areas address the local wine exporters: mediation of know-how about the country of destination (e.g. market, consumers, preferences, etc.) (6) as well as the preparation and maintenance of an infra-structure for the providers (7).
The experts judge those service areas concerning the success factor export promotion rather heterogenously, but with steady profiles of relevance and performance for the parameters.The connection with opinion leaders in the countries of destination and the mediation of an impression concerning the country of origin are regarded as especially important [55][56][57][58].These factors are followed by the conveying of information on the grape varieties.On the contrary, the communication of the touristic attractivity of the country of origin as well as the establishment of an infra-structure in the country of destination are considered less relevant [5,59].

Results and discussion
The structural model on success factors, which was deduced from literature, as well as the defined wine-specific setting levers for the configuration of these factors work well for a survey concerning the relevance in the wine industry and the German providers' performance.With reference to their relevance, the four success factors were judged with values of 3.25 to 4 (scale of 1 to 5), which means that all of them are considered highly important.Export strategy was judged as most important, directly followed by commitment and export support programs [28].With a value of 3.24 the knowledge is considered less relevant.These findings support the scientific perceptions on success factor research in the export and result in the insight that a broad, holistic management, supported by targeted export promotion, is very important.
Furthermore, the defined setting levers show a good adequacy for the success factor research, since in the survey all the parameters are considered relevant.The experts regard the establishment of a network in the country of destination as most important, because it ascertains the personal contact and makes it possible to solve the industry-specific challenges on the side of the providers.The providers' characteristic fragmentation, the slight brand stamping, a great variety of products and producers   and a product complexity with high emotional benefit and insufficient objectivity of product advantages only lead to a noticeable differentiation, if a personal commitment and a storyline are given [60][61][62].This needs to be conveyed to the business partners and should be accomplished in the whole sales mission.This explanation is also supported through the consideration of those setting levers which were judged as less relevant.The knowledge of local consumer preferences as well as of the competitive environment in the country of destination is considered less important.This may be explained with the assumption that the demand for wine from the local market might be characterised as unique characteristic because of the consumers' expectations [26].It is important to work out, convey and to sustainably provide these features and shaping characteristics with the help of entrepreneurial commitment.

Export PromoƟon
Generally, the capability of German wine providers was judged as very high in the context of this study.This positive resonance, therefore, reflects an increased quality perception of German wine.Especially the level of knowledge of the market was considered markedly good.All the setting levers, which have already been introduced, are mastered by the German providers.Additionally, the export support is considered very effective.The similar profile line of relevance and performance illustrates that the differentiated judgement of the relevance of certain service areas are covered appropriately.
But, nevertheless, there are also weaknesses: The German providers need to improve the success factors for the sustainable allocation of resources and the strategic processing.Furthermore, there are performance gaps in the fields of product adjustment concerning local requirements, the brand availability, unique storylines and entrepreneurship.These gaps may certainly be explained with the structural circumstances and the fragmentation of the German wine industry.Larger companies with specific marketing departments dispose of valuable resources and competences, whereas smaller ones do not have these possibilities.Thus, it is not surprising that the export sector is mainly apprehended by wineries and associations, who dispose of sufficient company sizes in order to fulfill the success factors.
The high capability of German wine providers concerning the success factor market knowledge, which exceeds the relevance values, gives rise to discuss.On the one hand, the targeted resource allocation should be questioned.On the other hand, this observation appears to approve cultural impact factors [63,64].In the case of an overfulfillment it should be verified if a resource deferral for the benefit of those setting levers which have not yet been fully satisfied was possible.Especially the higher relevance of two other success factors (strategy and commitment) with a slighter performance initializes the need for improvement.
The overfulfillment in the knowledge-oriented success factor of German providers goes along with the findings of cultural research on companies in the international comparison.In the context of "avoidance and insecurity" Germany shows a higher value than many other nations.Planning, intensive data studies and profound analyses shape the German companies' activities and are supposed to contribute to the avoidance of insecurity.Therefore, this study supports the demand of many other scientific studies for the consideration of cultural aspects, which have been neglected until now [28].

Limitations of the study
Considering the restricted amount of cases, these observations are not representative.A higher amount of cases would also make valid analyses concerning different destinations possible.However, the investigations on consumer perception of wine-producing countries have illustrated that the expectations and wine images appear to be homogenous.Furthermore, it should be taken into account that the acquired data material does not allow statements about causal effects.The general query of success relevance and capability without an exact definition of dependent success variables is for this explorative study expedient.Nevertheless, it does not allow any multidimensional success analyses.Furthermore, the investigation examined only the capability and improvement potential of German providers and did not consider the perception of German wine in destination markets.

Conclusion
The global wine market passes through changes and reveals growing wine markets, such as China, Brazil, India and the USA, which also tempt German producers.Nevertheless, the sustainable successful treatment of foreign markets is an entrepreneurial challenge which should not be underestimated.
By the use of an expert survey, this study questions an empirically verified success factor model by taking the example of wine industry.The experts' opinions give some indication of the success factors' relevance for the wine industry, as well as of the perception of German providers' performance concerning the setting levers.Thus, the study meets the wishes for advances in knowledge about export by using structural models and without generating single causalities.The acquired findings are scientifically relevant and empirically usable.The well-tried structural models are also applicable in the wine industry.The industry-specific investigation with a definition of operation parameters for the success factors as well as their peculiarity in viticulture, therefore, contributes to the knowledge acquisition concerning the scientific examination of export.For German wine producers and marketers these findings convey specific instructions and suggestions for individual strategical measures in order to exhaust market potentials in foreign countries professionally.
Four success factors considered relevant are also important for the export of small viticultural companies.Besides a proactive preparation of market activities, this requires a strategical implementation with entrepreneurial commitment.Furthermore, the companies should be accompanied in terms of an export support.The German wine industry is awarded a high capability.Besides that, the overfulfillment of knowledge-based success factors approves cultural characteristics.Generally, it should be considered to initiate a resource allocation.

Table 1 .
Scores on success dimensions.