Australian Wine Exports to the United States
The macroeconomic discussion includes social trends and change, digital technology, level of development, economic risks, and economic system. On the other hand, the micro-economic discussions entail the consumer-demand conditions such as income level, consumption levels, and expenditure versus savings. Technology It is clear that technology has imposed numerous issues that influence the way people spend their income. Moreover, technology has transformed the way people do business and have resulted into positive transformation of the business world as well as posed numerous challenges. In simpler terms, technology can be equated to tools, procedures, and skills that utilize these technological interventions to enhance business. The advertisements conducted through the mass media are tools for propaganda and that can be used to promote products and businesses of local wine distributors.
All these tools can be utilized as incentives for reaching out to wider audience across the United States and ensure that imported wine gain popularity. Notably, the mass media is a technological tool that liberates businesses and offers a platform to increase sales and increase the scope of the audience (Mutekwe, 2012). Tucker (2018) noted that there are numerous issues that people should be concerned about as the social trends are impacted by change, especially through technology. Businesses should be prepared to adopt artificial intelligence that will assist in business management and decision making. The nation is becoming more diverse as more people migrate into the nation. It is noted that American are the biggest spenders in the world. Collectively, it is acknowledged that American spend more every week than the GDP of some nations in the world.
According to the census bureau, there is an increasing number of individuals that live in poverty, which is more than five million people more compared to the statistics in 2000. In spite of this, households have been spending much because they have been able to borrow heavily. The presence of foreign products within the local market has allowed economic institutions, especially the Federal Reserve, to maintain the lower interest rates. This has consequently boosted investments and consumption within the nation because there is an increase in disposal income and access to affordable loans. In this regard, the local distributors have the luxury of importing foreign wines, which gives the Australian wine an edge to gain access to the American market (Litan, 2000). There are also structural challenges that pose dilemmas and are compounded by the structural challenges that antedated the financial crisis.
It is noted that the average wages have been constant for more than a generation and distribution of income is highly skewed (Bergsten, 2011). The increase in the income of consumers consequently increases their consumption levels. On the other hand, the substitution effect argues that the consumption or expenditure of consumers is influenced by the pricing of goods (Henry, 2013). This means that whenever the prices of particular good increases, their level of consumption also reduces. The Bureau of Economic Analysis measured the Personal Consumption Index and established that it has been moderately increasing at a rate of 2. 4% annually (Henry, 2013). Therefore, as the statistics have revealed, the United States is an ideal area to export wine because the income levels have increased and consumers have the luxury of purchasing a range of diverse products.
As the income increases, consumers will prefer consuming superior and foreign wine brands compared to local ones. Hence, this offers the local distributors an opportunity to enhance their product portfolio through importing of other wine brands. Australian wine has a potential of gaining market access in the United States and ensuring that they gain a competitive edge in the United States market. Social Culture According to The Conversation (2014), wine consumption is increasingly becoming a prominent culture in the United States. The price of wines ranges between $10-$15 per bottle and can be consumed at home (Thach, 2014). America has a long history of wine consumption that predates the entry of Spanish explorer Ponce de Leon, who arrived in Florida in 1513 (Thach, 2014). Since then, wine production and consumption has developed and expanded into all states.
It is also noted that wine tourism is increasing in the United States of America. One of the most visited winery is the Biltmore Estate in North Carolina, which boasts of more than 1 million tourists annually (Thach, 2014). This offers consumers more room to purchase products that they could not initially purchase. In addition, the cultural analysis has revealed that American prefer consuming wines with their cuisines. The United States withdrawal from the TPP would affect the Australian wine exporters who enjoyed duty free business with their United States stakeholders. Technology is also noted as a major force in transforming the way people conduct businesses and transact. Therefore, it is essential for businesses to realign their products and business processes with technology to ensure that they reach out to more clients.
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