A&B Vintners do an excellent job, and really present the wines well. They do sell to quite a few private clients, and that, IMO, is at the heart of why they sell the vineyard designates and micro-lots.
But the emails they write up to present the wines are exceptional and offer a really good look at what makes Oregon special, and why the people they work with are producing some truly exceptional wines.
Interesting, A % B sells most of the Oregon wine I buy.
Marcus’s details on costs and DTC vs FOB are incredible and spot on. (Who knew this would be in a thread on shipping : ).
On the FOB side, I was completely naive but perhaps it worked to my advantage. As a small winery with a couple a great vintages, I didn’t really have any barrels that I thought needed to be declassified to WV non-Vineyard Designate (and I love my press fractions— especially since I don’t like using new oak). So as I acquired a hand full of distributors across the US, they are used to me offering no WV, only great wines. That said, the naive part, is that they are only selling a half or full pallet per State, per year (56 cases per pallet). Hmm.
For the 2022 vintage, for whatever reason, I did find more than a few barrels that needed to be declassified to WV. So I am literally needing to decide tomorrow on price. I thought $12.50 would be as low as low can go, but they really want $10/bottle for a retail of $19.99 to $25 depending on retail markups. And also, this apparently is the top end pricing for most by-the-glass programs at restaurants. (Restaurants are doing no favors to us on their glass markups. They could have much better offerings and sell more, or at the very least have more satisfied customers. Also BTG is often the introductory wine for younger consumers and the offerings at most places are just abysmal. No wonder these folks are preferring cocktails!)
For sure DTC is way, way, more time intensive for all the reasons listed above. I have a couple of colleagues who just don’t have the time, or they don’t enjoy it. I love it. The direct interaction and feedback are the reward. But I can see a day when I just won’t have time for WV deliveries, making packages, checking on shipping dates with clients, etc. I certainly hope I will always have time for tastings at the winery! Does DTC give us a higher return? It depends on how you value your time, but Marcus is spot on: I think it is difficult to sell higher end wines without a tasting room or other form of DTC.
Tasting rooms are the most common form of DTC— hasn’t been discussed here too much. I worked in a TR for four years part-time as I was learning the trade, and because I enjoyed it. The downside is that as a wine maker you become a personnel manager. I know more than a few colleague winemakers who (given the time sink) unintentionally have turned into TR managers and they don’t seem very happy…. Constant turnover, etc. You also need just the right spot/real estate by the way. And so, I have peeked at the balance sheets for two TRs and they really don’t pencil out too much with the exception of the fact that you can tell a story to more people, and make and sell more top-end wines. The real trick is getting the the twice-a-year wine club mailings and pickup to 200-300 cases per, minimum. That’s the profit margin and the all-important inventory management piece (the winery choses which wines are sent out, woohoo!) But the downside is that, as @CFU said on his Chateau X podcast interview, I think both younger and high-end clients want to chose their shipments… automatic shipments are passé. (Great job on those interviews, Charlie!)
This is the internet, Sir, and I am duty-bound to attack your comments, no matter how reasonable they may be.
May I begin by expressing distrust for your character and motives . . .
You’re not very good at this!
A few years back I started my own thread here Start my own shipping about this very topic. Between me, Marcus and Larry, we could totally employ our own driver, bear the full cost of a Sprinter van, cold chain from door-to-door and prob save money. We are fast approaching the scenario where even a smaller winery will save money employing their own delivery service, even nationwide.
Here’s the one thing - we are today paying for speed. But our customers don’t give a sh** about that - they just care that it gets there cold chain and in good quality. So why not have a service that consolidates shipments and take the speediness out of the cost equation?
Agreed I have had wineres tell me… “I can get you your order right away for an extra charge” My response… It’s okay just wait until it is cool and safe to ship and send everything together I’m in no rush…
They have an excellent set of producers they represent. Many of my favorite peers are in their offerings.
Am I the only one that was picturing a new series for Frank and Mike from American Pickers?
That’s a no go for Frank with his back issues.
I am not in the states, but if I was, then I’d be very happy with the above as well.
In another life when I don’t have an excellent career, a loving spouse, and two youngish kids, I’d be putting some serious thought into securing a business loan and starting a new venture to do just that. Year-round, spend a week cruising through the [Willamette / Walla Walla etc. etc.] Valley, picking up smaller shipments for wineries, and then delivering them to certain pickup points. I know, I know, it would be difficult to scale and it’s nowhere near a clear business plan, but still…
Phew, I thought you would say something crazy like become a winemaker.
I’m in Frog’s Leap 3 bottle red wine club. I emailed them a few days ago to see if they could hold the wine and send me one case a year, rather than 3 bottles every quarter at $35 shipping. No response yet, but I may cancel my membership of 20 years or so if this doesn’t work. It may be too much of a logistics problem for them, but I don’t think I want to keep paying $140 a year to ship the equivalent of a case of wine. (particularly as a club, where I wouldn’t purchase all those varietals if given the choice)
Curious - how much effort, if any, do wineries put into reviewing their shipping destinations to see if there are economies of scale or other ways to cut down on cost and packaging?
I have a locker at a wine storage facility, and I see shipments come in all the time from one winery for multiple people. Everyone has their own box, often times 3 or 6 bottle shippers (styro as well). Sure, some people don’t want to mix their bottles up with someone else, but it seems like there could be a few ways to reduce costs and waste. Combine all orders and send together on a pallet? Combine bottles in larger packaging if the recipients give you the ok? Probably other things you could do as well.
Hey Todd,
It’s definitely possible. Nathan is going to reach out to you to coordinate the details. We’re switching to a new e-commerce provider and overhauling our website later this fall, which should help make customizations a lot easier. I appreciate your being part of the club for so long!
Looking forward, we’re part of a group of wineries that is constructing a warehouse in KY as a new hub for wholesale and DtC shipments, which should help make things cheaper and faster for a lot more folks, not to mention more seasonally available and less GHG intensive.
Rory
That absolutely is fair. Though generally I am comparing winery price to the price at K&L, which is a mile and a half from my house.
I think the additional factor I most consider is maintaining a relationship with the winery.
Marcus,
Thank you for your comments. They have been very informative regarding the business from the winery perspective. Also, since you are the winemaker commenting, I want to be clear that the topic was not intended as a shot at wineries. I understand that everyone is trying to make a living.
Kevin
I’m realizing from this discussion that I’m very lucky to be close enough to the few domestic producers I buy from to pick up, or have delivered pretty cheaply, as well as some pretty good small retailers. I feel for those across the country that have to deal with shipping costs and weather. OTOH, all you guys with basement cellars need to stop whining, compared with the annual storage locker costs I have to pay 
Hi Kevin,
No offense was taken on my part. Tbh, I think this is a really important topic and appreciate your honesty.
As noted above, dtc is a very important part of our ability to make the winery work. As shipping prices have been rising, it leaves Megan and I extremely frustrated. Over the past 10 years, the increases have definitely been faster than inflation.
At some point this can only lead to the choices the OP makes. Or only high priced wines can ship (this is already kind of the case) anywhere.