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Editor's Letter

 

The To-Do List for 2012

January 2012
 
by Jim Gordon
 
 
With the new year comes a chance to improve yourself, your winery and your vineyard. Let’s leave the “yourself” part to other magazines like Oprah and Men’s Health, and focus on the other two. I think the wine industry now lives in a world quite different from that of 2007, when the wine business was firing on all eight cylinders. Today’s wine economy has lots of good things going for it, but it’s a leaner, more efficient economy—not a V-8 anymore but a turbocharged 4-cylinder that averages 30 mpg city/highway.

Wine sales are growing rapidly in some channels, but customers are being pickier than ever, demanding great value and great quality together. This puts the pressure on everyone from the grower to the retailer to keep costs down and quality characteristics up. Whether your customer is Joe Gallo or Joe Sommelier, he wants to buy what you’re producing—but he’s going to make you really earn his business.
So what can you do? This issue is full of ideas and advice on that front.

Get better
If you haven’t yet grasped the concept of total package oxygen (TPO) as a key quality-control indicator for your products, it’s time to learn. In her article about preventing oxygen-related flaws, Jean Jacobson asks, “Is TPO the new TCA?” I think it is. She discusses preliminary evidence that oxidation and reduction issues cause more flawed wines than TCA, and asks veteran winemakers what they can do about it. TPO may gain a lot of traction in 2012, and a good understanding of it will only make your wine better.

Embracing harvest mechanization is another way to get better. Over-the-row harvesters, optical sorting and other ways to use technology to fine-tune the harvest process are the subjects of Thomas Ulrich’s piece, “Harvest Technology Comes of Age.” Evidence keeps mounting that mechanization is good, even for high-end wines. It can save you money, speed your harvest operations and even get you more anthocyanins.

Get bigger
Our longtime columnist Cliff Ohmart examines how the size of a vineyard operation affects its sustainability, and he means economic sustainability in this case. For his Vineyard View column, Ohmart deployed a survey to investigate correlations between the sizes of vineyards, the length of time they have been under the same ownership and the portion of those owners’ incomes that are derived from winegrapes. My take-away is that small operations are not more sustainable than big, contrary to what the public might think.

Get closer
Close to your customer is the place to be in 2012. Mike Grgich of Grgich Hills Cellar once revealed the secret of his success wasn’t the level of toast in his barrels but his winery’s location on busy Highway 29 in Napa Valley. Here thousands of consumers visited each month to taste and buy wine, and he could collect the entire markup on each bottle!

Getting close to your customers or bringing them close to you is probably more important than ever. Read Paul Franson’s article about winery design and construction, which underlines the importance of building a facility that takes as good care of visitors as it does of the wine. For a concrete example of this approach being incorporated fully in the business plan,  Linda Jones McKee reportsin the Wine East section on the success of Barrel Oak Winery, a sales-oriented startup in Virginia.

Get out
At the other end of the spectrum, winery owners who have completed the items on their to-do lists already may be thinking about selling their businesses and slowing their paces. Robert Nicholson and Josh Grace of International Wine Associates have facilitated dozens of winery mergers and acquisitions. They say the climate for winery purchases is warming, and in their article they detail how sellers should get ready for a sale.

Get going
Many, if not most, vintners got into the wine business because they liked working on the production end. Growing grapes and fermenting wine have their own built-in satisfactions. Until recently, a thirsty and increasingly affluent public appreciated their efforts and bought their wines, almost without regard to price.

Now, however, the whole business is leaner. Growers must try harder to win winery contracts, and winemakers must try harder to satisfy customers in the wine trade and the consuming public. To succeed in sales, you must provide more bang for your buyer’s buck. There is no getting around it. You need to do it. It’s time to get going.

 
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