Friday, December 30, 2011

Wine Sale Pitfalls and How to Avoid Them

Over many years of reading about wine sales and close outs, I have noticed a number of things the consumer can do to reduce the chance of buying inferior wine. One of the most important things you must know is the cost of your wine at full retail. Then ask why this wine might be selling for less. Is it too good to be true? Do your homework and check out the vintage and importer. 

Retail cost: You can find this on the winery's website. However, there are discounts which are often volume driven. This reduces the price and the retailer still makes a good profit margin. I suggest that you track a handful of brands which you really like and keep in mind their high and low price.
Examples: Mondavi Napa Cab. H=$22/L$15.50; Domaine Chandon H+$22/L$11; Edna Valley Chardonnay H $12/L$8+. will give you a spread of current prices for a huge number of wines. 

Why is the wine on sale?
Often wines are inexpensive because they are a year or two past the current vintage. This is the point at which you need to try a bottle to see if it meets your needs. Many red wines (and some whites) do quite well with some bottle age. If the wine is an end lot there are many possibilities for why it is being moved. Prepare to invest some time and a bit of money to get the best bang for your buck as you will have to purchase a larger amount in order to get the deal. Share this with your fellow wine drinkers and you all win.

Is it too good to be true?
Sometimes a retailer will offer a wine at discount and have only a few bottles for sale. The fine print often states that the sale is subject to inventory on hand. This kind of advertising is used to bring customers into the store. While they did have the wine at some point, though you will probably not have arrived in time to buy the few bottles in the ad. I have attended sales and been told that a wine was sold to someone prior to the sale! I feel that this is a sign of an establishment to no longer do business with.  

The most important tool a consumer can have is knowledge. Know your prices, know your retailers, and develop a relationship with the people at your local wine shop. They are a great resource for information. Happy wine hunting and keep your eyes open.

Thursday, December 29, 2011

Wine Futures

Having been in the wine business for more than 30 years wine futures have been  the rage for many years. A number of wineries offer futures in the spring following the harvest. When buying a future you put your money up first and order what you feel you want to consume.  Many California wineries offer their top wines and suggest that the future price is a big saving over the release price. Generally speaking futures are at the upper end of the wine dollar scale and involve wines which need to be in barrel for well more than a year.  Bordeaux in years past were actually a good deal but the market has grown so quickly world wide that they for the most part they are out of the average wine buyers pocket book. However smaller wineries offer their better wines as futures and if you like their varietals  and wine making style you would do well to purchase a case or so.

A major issue in buying futures is knowing your wine store or merchant.  Your money is tied up for more than a year before you get your wine. What happens if the store closes or goes bankrupt? Who do you contact?  In your reciept you should know who is selling the future to your store and be able to contact them in the event the store closes. They should be able to inform you as to when the wine arrives and how you can pick it up.  The merchant makes very little on futures and does this more as a service to the customer.

The advantage of buying futures is you can accumulate a series of years of the same property. You are likely to save money on the release price. You often can get the wine in different sized bottles: half bottles, fifths, magnums, double magnums or larger. Wine futures are for those people who are fully invested in a type of wine and see a future in buying the wine young and letting it mature in their cellar. Another way of looking at futures is buying wine in the year of your anniversary or the year of your childs birth. What better way to celebrate than to open a wine from the year of a special event.

A way of saving money is to buy futures as part of a group.  This way you are not getting a full case and still get the opportunity of owning a great wine.  You must remember you are buying the wine unfinished and there are changes that do happen. Always look for a top producer with a good track record.   Good hunting.

Sunday, December 25, 2011

Protecting your dollar in a down year

After talking with wine brokers and several California winemakers, it appears that 2011 was a major challenge. This year the weather was very poor during flower and and set following a mild and cool summer. As a result, crop levels will be down all over the state and production will be lower than expected. This will cause consumers to change their buying habits.

So how can you protect your dollar and continue to buy quality wine in a down year?

I recently had the opportunity of talking with Cameron Hughes who is a recognized wine broker with a large presence in major retail outlets. He sources fruit from all over the West Coast and into the Southern Hemisphere. Mr. Hughes has positioned himself with sources other than California and continues to provide consumers with very good wine from multiple appellations. He buys wine on the open market from quality producers and finishes the wine making and then hands a portion of the savings to the consumer in the price. Another wine broker such as Castle Rock offers outstanding varietals for your wine dollar. These are two examples of large names that traditionally sell high quality wine to consumers at a very good price. In a down year, such as 2011, look to quality wine brokers as a source of quality, dollar-value wine as opposed major brands.

In addition, I have always felt that there are great wines all over the world, so open your search to foreign regions. The influx of foreign capital has resulted in state of the art wineries with viticulture practices that are making world class wines. Argentina and Chile offer tremendous value in all varietals. Australia offers wonderful red and white wines at very fair prices. Broadly speaking, the Southern Hemisphere is a rich resource. And Europe has a wealth of countries which produce high quality and price-worthy wines. Italy, France, Austria, Portugal and Spain are homes to large and small growers of fine wine. 

Look towards other sources when the market is not something you're familiar with - look for something from another country or find another varietal. Experiment.

Wednesday, December 7, 2011

How to find a good wine deal

A wine deal is when you can buy a quality wine for less than retail. You need to qualify what meets your needs as a good deal based on both the price and the wine quality.

Wine deals are always on the horizon. When they show up, you must be prepared to act fast as the best wines are usually gone in a short time. There are many ways of finding a good deal...

Be advised that most often newspaper ads don't offer great discounts because of the cost of advertising.

"End of Bin"
Look for discount stores which sell "end of bin" items in all forms. They often carry wines which are closeouts of wholesalers or end of vintage wines. There are also wines from wineries which have gone out of business. For example: Havens Winery, Evergreen Winery, 5 Mile Bridge and host of others. The bank who owns a winery's assets sells them to the bidder with cash on hand. Everyone wins in this senario.

Estate Sales and Business Closings
These do not happen often, but when they do you need cash and a good eye. In the recent past I have bought wines from a home winemaking company that was moving and decided to sell rather than move inventory. At $5 a bottle, most of the wine was of superior quality and dirt cheap.

Winery email lists
This is often not the best, but smaller wineries sell small lots cheaply and are glad to both create space and close their books on the wine they have had in inventory. For example: Starry Night winery is currently offering small lots of excellent wine to clear inventory.

Your wine friends
Remember that more than one pair of eyes will find a deal. Keep all of your friends aware of the fact that you are looking for deals. Most of my best deals were because of information gleaned from a friend. My wine group of 10 keeps in constant touch and shares information.

A good source of information online is which provides weekly updates on wines in the greater San Francisco Bay Area.

I hope this has opened your eyes to some alternate forms of buying wine. My next post will be on the topic of what to watch out for in commercial sales and what the pitfalls are of some "good deals".