Beverage Wholesaler - October 30, 2017 To view this email as a web page, click here.
Cheers Weekly


American Wines Forecast Continued Growth

The coming year’s forecast looks rosy for American wine retailers and American vintners alike.
Stability in the U.S. economy and favorable demographic trends are currently pointing toward continued growth in wine sales in 2017, so the industry looks likely to build on gains made in recent years.
On the pricing front, consumers are continuing to trade up in 2017. While more than 80% of wine category volume still occurs below $10 at retail, national data shows that consumers are increasingly seeking more premium offerings, and the most significant growth in the first two quarters of this years is occurring above $10 a bottle.
Most retailers across the country have felt this “premiumization” trend. At Oliver T’s Market in Grand Blanc, Michigan, partner and wine buyer Chris Capoccia remembers that he used to ask every customer about their budget as a starting point. “When we started, I’d ask if $15 was too much and for a while that was a line in the sand. Nowadays, it’s frequently the case that $20 isn’t too much and often $30 isn’t either.”
Those spending more are still looking for certain quality factors in his view – noble grapes or top appellations – but he notes less reluctance to spend more on local products in particular. “Michigan makes some good wines and people are increasingly open to trying them,” he says. “We’ve doubled our local wine selection in the last 5 years, to what’s now 12 linear feet of six-foot shelving.”
Premiumization isn’t felt equally by all retailers, however. Just one state over Jason Jonas, the general manager at Timer’s Beverage Center in Racine, Wisconsin, says his operation sees more bargain hunting than trading up.
“If anything, what I’m seeing is pushing the other way,” he says, but he’s not sure if that’s entirely a reflection of his customer base. “Our distributors are getting more and more aggressive on price, so we’re still seeing the most sales growth at $6.99.” What he does think is interesting is the swift uptake of low calorie and low carb wines. “Three years ago, we didn’t carry any of these items, but now we have five SKUs and they fly off the shelf.”
As one might expect, these prevailing conditions are leading vintners to aim higher with their new products. Fetzer Vineyards, the company behind Bonterra Organic Vineyards (pictured atop), is a B Corp that’s right on top of many of the hottest trends. One of its newest brands, 1000 Stories, is a super-premium Zinfandel aged in Bourbon barrels that is resonating with whiskey drinkers.
“We continue to innovate across categories, most recently with our highly aromatic Adorada Rosé and Pinot Gris, which launched in select U.S. markets at $18 SRP this summer,” says Fetzer’s vice president of marketing Rodrigo Maturana. “Capitalizing on our depth of expertise in sustainable grape growing, we’ll also introduce a sustainability-minded 1.5-liter bag-in-box wine at the $10 price point. This new brand is partnering with grape growers to help convert their vineyards to certified sustainable farming practices.”
single vineyard
Talking Taxes with the TTB
Beverage wholesalers face a slew of regulations and taxes. Many differ from state to state, while others are federally mandated. For a take on how the U.S. government sees its role in this, we recently spoke with Tom Hogue, the Congressional liaison and public and media affairs for the Alcohol and Tobacco Tax and Trade Bureau (TTB).
BW: How are you handling the increased number of craft distillers?
TH: The growing number of small producers does present us with challenges in getting permits and applications turned around in a timely fashion. And the industry is coming out with all new kinds of products all the time, which is another challenge. But I’m happy to say that we have recently brought down those turnaround times significantly. Congress wanted us to focus on that area and directed funds towards us to accomplish that goal. They have done so for the past two years now. The permitting and application process is no longer taking quite as long. We’ve gotten much of it under a ten-day turnaround time.
BW: How does the TTB look out for the smaller producers?
TH: The TTB wants to promote a level playing field, which is a responsibility we take very seriously. The vast majority of what’s made is not from small producers, so that concept of a level of playing field is very important to them. The last thing they need to worry about is ‘pay to play’, or the bigger companies not playing by the same rules.

The sixth annual Women in Wine Leadership Symposium, hosted by The Winebow Group, took place a few weeks ago, bringing together sommeliers, retailers, educators, journalists and winemakers in NYC. Speakers included Jancis Robinson, Dr. Laura Catena and Madeline Triffon.

Business Manager, Premium Accounts
Wholesaler: Breakthru Beverage
Location: Miramar, FL
Bachelor’s and 8 years of sales/marketing experience.


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