Lower Price from Retailers than Direct from Winery

I noticed recently a winery releasing their cabernet reserve via their website for $145 per bottle. WS on the other hand already has two decently cheaper options of $115 and $120. How typical is this and is there any way around it? I prefer buying direct from the winery as I’m sure most so, but they aren’t exactly incentivizing that here. I appreciate the feedback and commentary in advance.

For the most part, especially for the larger wineries, they have to “protect” their retail prices. If they were selling their wines at lower prices than retailers were, they would lose the support of retailers nationwide.

Smaller wineries who sell 75% of their wines through their mailing list don’t have to worry about this, but imagine a wine like Joseph Phelps Insignia selling for 20% less at the winery than retail, who wouldn’t buy it direct rather than from a retailer?

The retail business is the heart and soul of the American wine Industry, and the 3 tier system has to be protected.

For 90+% of California wines, lower prices can be easily found on the secondary market - often several vintages previous of current release. Why pay extra for the privilege of paying to cellar wine for years/decades?

Isn’t that the whole model for buying from Bordeaux and Burgundy? newhere neener

It’s Friday, lets stir the pot a bit…

It’s amazing how in a few short years California wineries have brainwashed customers into somehow thinking a better price from a retailer is somehow…bad…or weird?

It’s almost as if its assumed that the wine was ‘damaged’ on the trip from the winery to the store or some $150 brand is being ‘destroyed’ or ‘in trouble’ because its $5 or $10 less on a retail shelf. Really?

Prior to the Supreme Court ruling allowing Direct to Consumer sales for wineries, retailers were the ones on the front line, selling/promoting these brands, usually had a little better price than the winery as an incentive to customers to actually purchase the wineries product, and generally received the support and appreciation of the wineries in doing so. This is nothing new. It did not ‘destroy’ brands or encourage ‘concern’ for customers about the health of a brand. It sold wine.

How things have changed…It’s almost like California retailers (or perhaps retailers in general?) are ‘bad guys’ and in fact the winery’s own competition!

I understand there are a lot of factors behind this philosophical sea change that began in the 90’s with Bryant, Harlan, etc, some of them financial.

But, nowadays, is it the thought among winery owners that actual wine retailers are bad guys? Good guys? Helpful to the California wine industry? Hurtful? Do winemakers/winery owners buy wine? And where? Do they appreciate paying a better price for a premium brand?

Is it our new lot in life, at the implied request of many (not all, thankfully) new Direct-to-Consumer-only California boutique wineries, to sell California ‘critter labels’, ‘corporate, cookie cutter brands’ and ‘closeouts’?

As a long-time California retailer that has sold/promoted millions of dollars of boutique, hand-crafted California wines over the last two decades I’m personally a little confused as to where this is all headed…

Can California tell me?

Not when you can acquire ready to drink vintages from a reputable retailer with a Provenance Guarantee. [whistle.gif]

Of course, Bordeaux and Burgundy have substantially gained in value over the last few decades, and they remain a much more Internationally in-demand commodity versus California wines. Cellaring becomes easier to justify.

I hear way too many stories about collectors who had the choice of buying First Growths or California Cabernet in the mid-80’s at roughly the same price. The guys who went old world saw their investment pay-off in a huge way. Most California Cabs from that era have not kept up with inflation.

I’m not sure you’ll get much sympathy here trying to defend the three tier system.

But I do get a kick out of wineries that insist I pay for 2-day shipping to Minnesota, and then I see their product at retail.


There was another thread on this very recently.

Exactly. It’s no different from any other industry where there are resellers. I’ve dealt with pretty much every large company in the tech industry and except for Apple, they pretty much all had resellers. In competitive purchases, many times those resellers would under-price the manufacturers. There are several reasons for it, but if you start undercutting your resellers, before long you don’t have any resellers. In addition, the cost structures were different and a reseller might be willing to take a smaller margin, or bundle it with some other products and spread out the differential. Not unusual at all to find things cheaper at retail than from the mfg, so why should wine be any different?

Kyle - I’m not sure of your point, or if it was just rhetorical. But if I were a small winery starting up, and if I thought I could sell direct to customers, why would I care at all about the fact that you or someone else might have worked very diligently with some other winery at some other time? Doesn’t mean any winery sees any retailer as a bad guy but it’s a little like a farmer’s market or even better, a roadside stall by a farm. Should they not sell their berries directly to the consumer just because Safeway has been selling berries for years?

I’d think retailers are going to be fine. Just keep doing good work.

That’s true Greg - but the biggest issues for these small wineries and those farmers selling their wares is; they can’t afford to sell to retailers when they are so small. If you are only making 500 cases a year of a wine that retails for $40 a bottle, you will gross $240,000 a year. If you sell through the 3 tier system, you have to cut that price in half (the other half is divided between the wholesaler and retailer) and you end up with a gross of $120,000. That is a HUGE difference.

I’ve found great bargains at a few stores here in Los Angeles on older vintages and even current wines. Many of the older ones are clearly off from heat. Not extreme seepage heat but from being kept at 70-90 degrees for a few years. Clearly not as fresh as similar bottles kept at 55. I’d much rather pay more to have them shipped from the winery (or fulfillment co). Which brings up another interesting question. Anyone know what temps the major CA fulfillment warehouses are kept at?

Buying K-J chard from the winery: not cost effective
Buying wines you can’t easily find in retail from winery: good idea
Trusting a retailer or winery to tell you where you should buy it: bad idea
Taking the responsibility to find the best deal for yourself: best idea
Three-tier: shitty idea

If you find a wine cheaper elsewhere, but prefer buying from the family’s winery, you can always contact them, let them know the price at the retailer, and see if they’ll do anything for you. Can’t hurt.