Environmental strategy: does it lead to competitive advantage in the US wine industry?

The purpose of this paper is to investigate and compare the perceptions of competitive advantage (cost leadership, differentiation, and performance) of those wineries which have implemented a clear business case for an environmental management system (EMS) and those which have not. Benefits and challenges of sustainability practices are also addressed.

Data were collected via self‐report web‐based survey. Of the 98 respondents, over 80 per cent were family‐owned, family‐managed.

Those respondents with a clear business case for EMS exhibited significant differences in cost leadership and differentiation advantages over those without a clear business case for EMS. Those with a clear EMS derived significantly greater supply chain optimization and operational efficiencies than those without a clear EMS. Those with a clear EMS also felt that they gained an enhanced ability to enter new markets to a much greater extent than those without a clear EMS. Results of this study demonstrate a significantly higher level of commitment by those respondents with a clear EMS when addressing sustainability initiatives during a current economic down turn over those who did not. Those respondents who had a clear EMS indicated that they had somewhat increased their sustainability commitments, rather than conducting business as usual with no change or somewhat decreasing sustainability commitments as those who did not have a clear EMS.

Activities that create competitive advantages for wine businesses are understudied; this research bridges that gap.