“In an interview at the UK launch of his new book ‘Crush It: Cash in on your Passion,’ Vaynerchuk said his wine retailing business, Wine Library, had 'rolled the dice with not playing the ‘08 market’ and said firmly that he would be staying away again in 2009.”
Yes, Drew, clearly. Margins have been reduced to near 0%. In my 9 years ITB, it has gotten worse and worse and worse. 2005 was the only vintage that I saw WL really promote and sell. Gary told everyone to buy buy buy as prices were going up up up. Like most retailers, including myself, I think he came to realize that it is impossible to make money on BDX futures, especially when you have some merchants selling at a loss, just to raise cash.
I agree that it is probably improvident for merchants to get involved with Bordeaux E.P. with this difficult economy. Too much risk, too little profit margin. Individuals, however who wish to buy an excellent vintage certainly could do it. The issue is who would you trust to be in business in three years to deliver your purchases that you had to shell out big bucks up front? That would worry me.
This is all of no consequence to me. Despite the hype, I am now officially beyond buying classified future bordeuax vintages. Age has to be considered when buying wines that need decades to enjoy.
I believe his point was to not make a substantial financial investment in the Spring of 2010, assuming that the global economy has still not stabilized, for something that won’t reach the market for another two years.
Three recent vintages have used large amounts. Regular and not excessive use of fungicides are probably taken care of by the vintification and fermintation process. Huge amounts like in 08 are still an issue that the Bords do not wish to discuss. I raised this issue last year and Parker, Squires and others attacked me. Parker hit me with his typical " It’s only wine, life is too short to worry about sh*t. "
Even if we assume that the 2005 futures campaign was not a significant financial success for WL (which, I think we need to say is a pretty substantial if, considering how strong their revenues were in 2006-2007), you need to remember how helpful the futures were to building WL’s brand.
Many WL customers (including myself) began buying at the store because of the 2005 futures. Many of the early WLTV shows were about 2005 bdx (strategy, updates, etc). There was a lot of interest, and the interest got a lot of people into wine for the first time, which was/is the WLTV sweet spot.
Had he not been participating in the campaign, and not been doing shows about 2005 bdx, it is possible/likely that the show would not have been as successful, which would detract greatly from the brand and overall financial health of WL.
IMHO, WL gained more than virtually any other retailer by selling 2005 futures.