It is impossible to say it isn’t great fun to visit Napa Valley wine country, but it seems like each time I am there I am busier than the last time. This trip west was no exception as I had a number of items to accomplish. I had originally scheduled this trip for the first part of December to match our initial bottling date. However I had to change that as our wine bottling date was moved to January.
Usually I fly non-stop between Chicago and Sacramento. With the rescheduled bottling date, I needed to change my flight as well. It was a shock when American Airlines informed me they had no non-stop flights in January from Chicago to Sacramento. My only option was to go through Phoenix, both out and back…not an arrangement I was fond of. To make matters worse: the flight was “wheels up” at 5:00 a.m. You have to get up in the middle of the night to make it from downtown Chicago to O’Hare Airport, for a 5:00 a.m. flight. My Uber driver picked me up at 3:15 a.m. to go to the airport. You can become tired and grumpy pretty easily with these types of flights.
Tiedemann Family Wine Happenings
Over the last 18 to 24 months we have had to take a long hard look at our wine operation as we face a number of production and sales challenges due to changes in the wine industry. For example, the price of grapes and bulk wine is increasing at a record pace in Napa Valley. This situation increases our production costs which causes us to have to raise our price per bottle. The age-old trick is to recoup your increased costs but not overprice the wine.
When we started our wine company in 2010, we were paying $20 per gallon for bulk Cabernet and Cabernet grapes were sold for $2,000 to $2,500 per ton. Today bulk Cabernet is selling for $80 to $100 per gallon and grapes are at $10,000+ per ton. To make matters worse other production costs are also on the rise.
All of this is coming in a time of dramatic changes in the overall wine industry in terms of sales, distribution and competition. It is becoming more and more difficult for boutique operations like ours to compete.
One of the major changes in wine sales over the past years is the changing world of Direct to Consumer sales (DTC). Today 40 to 60% (some even higher) of a winery’s revenue comes from DTC. This cuts into wine distributor’s and their customer’s (wine shops, liquor stores, etc.) sales and revenue. It isn’t unusual for valued wine shop customers, ones who purchased wine on a regular basis, to now purchase wines directly from the wineries. They do this through wine clubs or winery visits. They purchase larger amounts directly at the winery which limits their purchases at their favorite wine shop. I have had wine store reps tell me that some customers go on wine trips and purchase enough wine that they only visit the store every six months or so.
Another issue the stores are having is securing California wines at price points that fit their customers’ buying habits…all due to the increased wine production costs and growing demands on the west coast.
We have seriously explored and frankly are moving to DTC sales programs through our Glenwood Cellars Wines operation. One of the necessary pieces of the program is to increase the number of states you can market and ship to. Our current California Wholesale License allows us to ship to consumers direct in 15 states. To expand that number, you have to change the license which is costly and time consuming. Several months back we made the decision to proceed to do so and filed for our California Type 02 winery license. This type of license allows us to operate just like any other winery. We have signed a lease agreement and an operation agreement with Ballentine Vineyards and winery in St. Helena, Calif. This facility will now be our base of operation and was the first step in expanding into DTC sales. We will also continue to make some of our wines in Sonoma County, but the majority of our production will be at the leased facility.
To date the new license has to be approved by both the State of California and the Federal Government. We have received approval from the State of California, but we await Federal approval. Seems that the license has not cleared the TTB due to the government shutdown. We might now have to wait months until they get caught up with their paperwork.
Direct To Consumer Sales
We have been having discussions with a DTC sales consultant for about a year now. On this trip I again met with Connor Burns, our consultant in DTC sales. We made good progress in the development of the program. The first steps, which are underway, include building our Glenwood Cellars Wines website, finalizing other items such as our mailing list, licensing, third party shipping arrangements and assembling our social media campaign. We’re hopeful that in the next 60 to 90 days we’ll be in operation as a winery.
The Fun Part of the Trip – Our Wines
As I wrote about in my blog discussing my last Napa trip in June of 2018 (find that at https://tiedemannonwines.com/blog/6322/) winemaker Bruce Devlin and I blended three red wines:
2016 Tiedemann Adler’s Blend
2016 Glenwood Cellars Cabernet Sauvignon
2016 Glenwood Cellars Merlot
At that time the wines were blended and placed in natural oak barrels for aging. This trip it was time to bottle those wines.
This was my first time to be at the winery to experience the actual bottling process. It was a very interesting and educational experience. Most wineries don’t invest in their own bottling lines due to the expense. The alternative is to hire a company that specializes in bottling. There are a number of these specialized companies that own their own fleets of bottling trucks that are driven to your facility. These trucks are self-contained units with all of the necessary equipment and trained personnel to perform your bottling needs. Generally, the winery waits until they have a number of different wines to bottle and they do them all at one time.
We bottled 470 cases, or 5,640 bottles, in about 2.5 hours. This included the time to switch from one wine to another. We did have a problem in the beginning when the labels weren’t sticking completely to the bottle. This condition was due to the high moisture levels in the truck. The truck is open in the back to allow for movement in and out of the truck to the winery. On bottling day, it was raining, and the humidity levels were very high. Due to the excess humidity the bottles were damp, and the labels weren’t sticking properly and they were wrinkling. The solution we found was to turn on the truck’s air conditioning system and shoot the air down toward the bottling line and the bottles. This helped dry the bottles and take care of the wrinkling issue.
In addition to bottling I did some other enjoyable wine “things” while at the winery. I tasted some bulk wines including a Cabernet Sauvignon, which I purchased 420 gallons of to be blended into our 2018 Glenwood Cellars Cabernet Sauvignon. We also did a photo shoot of the bottling and other items, all to be used on our new Glenwood Cellars wines website.
Another afternoon during this Napa trip I met our other winemaker, Kent Humphrey of Eric Kent Wine Cellars, at the new Grand Cru Custom Crush facility in Windsor, Calif., which is just north of Santa Rosa. Grand Cru Custom Crush is a new, high- tech winery designed for independent winemakers and small producers. Eric Kent Wine Cellars is one of 19 small wine producers that work out of this new state-of-the-art facility. As I have discussed many times in my blog, Kent and I make our Glenwood Cellars Sauvignon Blanc, Chardonnay and Pinot Noir together.
This day we blended our new Glenwood Cellars 2018 Sauvignon Blanc and 2018 Chardonnay. To produce these wines I buy bulk wines from the Sonoma Coast area. The 2018 harvest was good, and the various wines Kent had selected for blending were delightful. I can’t wait to release the finished product in the fall of this year.
On my final evening of this trip I was able to, at last, meet our new wine license consultant, Susan Fiore and her husband John. Susan has her own firm, Susan Fiore Consulting, and has handled all the many items we need to do to get the new winery license in place. We had a wonderful evening conversing, eating some delightful Italian food, and of course drinking good wine, which was produced by John and Susan. I can’t wait until the next time we are able to get together.
Getting back to Chicago was a real challenge. My 6:00 a.m. flight to Chicago through Phoenix was canceled about 2:30 a.m. on the day of the flight and I was rebooked on a flight to Los Angeles, Calif., that would then go on to Chicago. I made it to L.A. but the flight to Chicago was delayed because of severe weather in Chicago (snow and high winds). At one point O’Hare was closed entirely when a United Airlines plane ran off the end of one of the runways. O’Hare personnel couldn’t keep all of the airport’s runways open due to the snow and very high winds. A large number of flights into the airport from around the country were canceled, as well as ones leaving O’Hare. My flight was finally cleared for takeoff four hours late. I was very happy to land in Chicago.
This Napa trip was quite successful. The troubling thing is that it takes so long to see the results of your efforts.
Uptown Kitchen’s Valentine’s Dinner
I have teamed up with Uptown Kitchen which is hosting an exclusive Valentine’s Dinner. I have personally selected all of the wines to pair with the evening’s menu. I have also put together a Reserve Wine List which will be available at an extra cost to anyone who might want additional or different wines. See the menu here.
The dinner is February 14, 2019, and starts at 6:00 p.m. at the Uptown Kitchen Restaurant located in Granger. There is limited seating for this exclusive dinner so call now to reserve a spot. The number is 574-968-3030. Don’t miss out on this special event.
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Until next week,
Calendar of Events
- February 18th – National Drink Wine Day
- March 3rd – National Mulled Wine Day
- April 17th – International Malbec Day
- May 3rd – International Sauvignon Blanc Day
- May 9th – World Moscato Day
- May 23rd – International Chardonnay Day
- May 25th – National Wine Day
- June 8th – National Rosé Wine Day
- June 20th – National Lambrusco Day