What Makes Up the Cost of A Bottle of Wine?

What's in a bottle of wine?--red

Well wine, obviously, but there's a fair bit more that goes into than that. The delicious liquid that is born from picturesque vineyards is just one of the costs that add up to the total that you have to pay, and there's a few more layers than you might have realised. We break down the main costs.

Wine & winemaking--aromatic

Let's start with the basics. The grapes have to grow somewhere, and we all know land ain't cheap. Luckily there's not many vineyards in inner city Sydney, otherwise we'd be hard-pressed to find good value wine! The vineyard land and the cost of planting the grapes needs to be taken into consideration, as does the fact that wine grapes have a single harvest each year.

Once the grapes are picked and crushed, there's various (expensive) winemaking equipment used to ferment and store the wine, the priciest of which can be fancy oak barrels. There can be significant difference in the cost of these, based on where they come from and who has made them.

Labour--racy

The cost of picking the grapes is the most significant one here. Winemaking salaries need to be considered, but one winemaker can produce tens of thousands of bottles, whereas a picker can only harvest a few dozen bottles worth of grapes a day.

Taxes--vegan

There's only a few certainties in this life, as they say, and sadly this is one of them. In Australia the tax on bottled wine is fairly significant, being 29% of the cost. Throw in GST on top of that, and you're looking at over 40% of the cost of the wine going straight to the government!

Bottle (label, cork, bottle)--cellar

A few obvious factors here - the cost of the glass bottle, the label, the cork and the capsule or anything surrounding the closure. There's also some extra packaging for wines by the dozen. Small costs when considered per bottle, but every little bit counts.

Marketing--plum

So you've made an incredible wine, now what? Well, you have to sell it! And to do that, people need to know about it. Bigger companies will spend eye watering sums of money on marketing each year, meaning that an increased percentage of the cost of the bottle will be made up of advertising spend. The little guys still have these costs, but as a smaller percentage.

Logistics--earth

We all love a bottle of Champagne over Christmas, or perhaps a great bottle of Italian red on a special occasion. But this wine took the long way here....it probably caught a boat! The cost of importing wine from overseas to Australia is huge, no two ways about it. Even getting a bottle from Margaret River to the east coast of Australia can be a little pricey, and is certainly part of the overall cost.

Margin--wines

Well someone needs to make a living out of all this? Yes, sadly after everything else has been accounted for, there's then a good chunk thrown on top, so that every business along the way can make a bit of profit. This obviously includes the winemaker, but everyone else wants a slice of the pie as well.

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About the Author

Alex Tanner is a certified sommelier through the Court of Master Sommeliers and holds her WSET 3 with distinction. Her experience in the wine industry stretches from working as a sommelier in award-winning restaurants in British Columbia, judging national wine competitions, and utilising her background in design and communication toward commissioned art, writing, and branding for wineries and wine bars and columns across the globe.