“There are some great deals out there for consumers, if they know what to look for,” says Jeff Leiker, buyer for the two Tower stores in the Atlanta area. “Now is a great time to get to know your local wine retailer.”
Yet another effect of the coronavirus pandemic on the wine market, consumers who have not been economically affected have the opportunity to make deals. After all, $ 46 for a Napa Cabernet isn’t cheap, but it’s a lot cheaper than $ 75. If you’re looking to build a collection or replenish that cellar you’ve been drinking in anticipation of the end of the world, now is the time to look for some bargains.
Here’s why: When the pandemic hit around this time last year, restaurants across the country largely shut down. Some have turned to retail sales and sold their wine cabinets to keep the cash flowing. In many jurisdictions, restaurants have been allowed to include wine in take-out or delivery orders, but this sales channel is only a tiny fraction of what it was before the pandemic.
Wineries basically have three sales channels: Direct-to-consumer via the tasting room or online, restaurants, and retail. Many high-end wineries focus on restaurant sales. Their name on a wine list and their label displayed in a restaurant safe and on tables that other diners can see help build brand recognition and a sense of exclusivity. These brands generally have limited retail visibility.
That changed when the restaurant chain basically disappeared overnight. Some wineries quickly adapted to the changing market and allowed their wholesalers to market the wines assigned by restaurants to the retail network. For example, Jordan Winery in the Alexander Valley of Sonoma County was named the most popular restaurant wine brand and No. 1 in cabernet sauvignon by Wine & Spirits magazine in its annual survey of restaurants as pandemic closures hit. CEO John Jordan quickly authorized his distributors to sell their restaurant allowances of his wines to retail customers.
“Throughout the pandemic, we have continued to make our wines available at certain retailers,” he said, noting that the average retail price of wines had actually increased over the year. “If discounts do occur, they are at the discretion of the retailer,” he said.
Or maybe the wholesaler. Here’s how it might work, based on conversations with several wholesaler reps who spoke on condition of anonymity because they weren’t authorized to speak on behalf of their business. Suppose a local restaurant group puts one wine on their menu for the year. Its distributor would buy several pallets of wine (one pallet equals 56 cases) and make deliveries throughout the year as needed. When the restaurants closed, the wine was stuck in the warehouse. And although consumers bought a lot of wine in the first few months of the shutdown, we tended to buy cheaper, so more expensive wines languished. Large distributors tend to want to move this wine even with large discounts, and small distributors may have an urgent need to move product.
Elyse Winery emphasizes direct-to-consumer sales and select select retail markets, owner Josh Peeples explained in an email. When the pandemic hit, it offered discounted wholesale prices in hopes that the retail price would stay the same, but wholesalers and retailers can pass the discounts on to consumers.
This is how Leiker found the Elyse Morisoli cabernet at such an attractive price around the new year – inventory time for distributors. It is also possible that the warehouse was cleared for the 2016 vintage, the current version of the cellar.
Leiker also delighted me about Schweiger Vineyards cabernet sauvignon from the Spring Mountain area in Napa Valley. The 2014 vintage, a beautiful year with a certain age compared to most current releases, was suddenly available at a price he could put on the shelves for $ 30 a bottle. The same wine on the winery’s website costs $ 75.
At MacArthur Beverages in Washington, wine buyer Phil Bernstein said a greater selection of sought-after vintages such as Italy’s 2016 Barolo were available due to lost restaurant sales. Andy Creemer, the store’s US wine buyer, said that “instead of a few bottles we were offered multiple cases” of allocated brands such as Kistler and Peter Michael. They were reluctant to discuss the issue for fear of straining ties with wineries and suppliers, a sign of the competitiveness and sensitivity of the wine industry.
We must remember that these good deals are offered to us because others are suffering. About 17% of American restaurants have closed permanently or long term due to the pandemic, the National Restaurant Association said in December. The recovery will be slow and we don’t know what restaurant wine programs will look like in the post-pandemic normal. Schweiger Vineyards barely escaped the fall wildfires and decided against producing wines from their 2020 vintage due to the smell of smoke. Importers are reeling from tariffs imposed by the Trump administration on some European wines and grappling with supply difficulties due to shipping backlogs linked to the pandemic.
“I’m honestly grateful for the business, but I wish it wasn’t at the expense of the struggling restaurant industry,” Bernstein says. “I much prefer to see restaurants come back in force, and I feel for them.