During a casual conversation with PC about sourcing and delivery, I was told that all pre-arrivals are paid for up front prior to the wines being offered. I obviously don’t know for sure, but they were very clear and unambiguous about this.
The number of threads about PC deserve an award! Count me in as a happy customer of PC. I have received 99.9% of all wines ordered and I’ve been a customer for over 15 years. They are not fast. It’s amazing to me that with all the threads about PC, some consumers are not aware of it. As a buyer, if you cannot wait, do not buy from them.
As for condition, all the wines I’ve purchased from futures in OWC to older, mature bottles have been in perfect condition.
It can be a pain to deal with them for some, I get that. But with 99.9% delivery at prices lower than everyone else, I will continue to buy from them.
Ummm…that is funny.
I just had a casual conversation with PC where they assured me that the Easter Bunny was real.
Not at all - I think that’s the genius of their model. When a recession hits, revenues go down AND the cost of sourcing wine goes down. And, because they control when deliveries happen, they can avoid a “run”. So unlike a typical pyramid-like capital structure, this one is fairly robust.
People can debate all they want about what might be going on behind the scenes in terms of when wine is actually purchased by PC, why it takes so long to deliver, where/how wine is stored in the interim, etc., but isn’t the real issue/concern the lack of transparency? After spending over $100,000 at PC, I stopped even looking at their pre-arrivals because (a) there are too many unanswered questions and (b) I don’t like the fact that PC offers special pricing for its highest-spending customers, which it would not make available to me. So with only an occasional exception for bottles that are already in stock, I now spend my wine money elsewhere.
In 2009 wine sales in the US dropped about 30% in dollar terms but prices of current releases and futures didn’t fall anything like that.
It’s a cute speculation but let’s be clear that that’s what it is. “Obvious” (your word) it is not.
I like Doug’s post!
Damn
Awesome post peter! I love seeing the pricing on the early purchases. Makes me sad that I didn’t get into burgundy until 2007. /tears.
All the Leroy, Roumier, Rousseau you want at sub $200 or so. PC sold mixed cases of 1st growth Bordeaux from the '00 vintage for $200 per bottle or $450 per mag.
The malconsort totally caught my eye, especially the quantity!
On Doug’s list, I saw 99 Rousseau CDLR for $49 and he bought 2 cases. People may bag on the CDLR from rousseau, but at $49? ALL DAY EVERYDAY even if it was years ago
This makes my wallet cry. Where’s that time machine from the other thread?!?
In 2008/9 I bought a few bottles of 99 Cathiard Malconsorts from PC’s RSS feed for $99 per. At the time it was perhaps the most I’d spent on a bottle of wine but it was a silly deal even then. The bottles were/are gorgeous and arrived quickly. If nothing else PC is worth it for the occasional mindblowing bargain.
There are a lot of crazy things on my list, but the mags of 2000 Clos de Tart for $120, 2000 Rostaing Cote Rotie for $15 (and I only bought one case?), 1999 Dagueneau Buisson Renard for $17 and the 1999 Chapoutier Hemitage Sizeranne for $20 are some of my favorites.
Well, it is obvious they are using futures purchase revenues to fund acquisition of wine to satisfy prior orders. I’m speculating as to why that model is particularly robust for them. So what’s not obvious is how much reserve they hold back for a rainy day and how much they can stretch out deliveries during a dry spell to conserve cash. That’s the other piece of the puzzle.
But having worked with a fair number of retailers, I’m pretty sure its a mix of all of the above.
David. Bet you wish you could go back in time, to when you started to complain about PC, and just buy from them, instead?
Your writings remind me a little of Nouriel Roubini. In about 2002 he started calling for the end of the financial world. He was wrong for 5 years, then he was fantastically right for about 1 year. But instead of taking his chips and going home, he continued to be hard core negative for the following 5+ years where he’s been fantastically wrong, year after year.
Don’t be a hater like Roubini. Just buy a little from PC. Take a chance. Go ahead. You know you want to!
Why/how is it obvious? It’s not self-evident to me at all. It’s a plausible hypothesis but by no means the only one.
I also lost half my pingus when it broke apart at sea, but that’s as much of the story as I’m comfortable sharing.
Somehow this came to mind this morning and I realized how utterly wrong your assertion is. After the financial crisis, the euro soared against the dollar. Through most of 2008, 2009 and 2010 it was far higher than it had been in 2006 and 2007 (with some brief, wild dips during various crises of confidence). It peaked near $1.60 in 2008, near $1.50 in 2009 and at $1.48 in 2011 after trading in a range of $1.20 to $1.35 in 2006 through the summer of 2007, when the credit markets began to snap.
That in fact pushed up current release wine prices in dollars. Most Americans forget this when they grumble about rising prices for European wines.
So if PC sold futures in 06 and 07 and hadn’t hedged or purchased the wines, they’d have been badly, badly squeezed when they went to purchase in the following years. Their cost to cover would have been 20%-30% higher than when they sold the futures.