Distribution and the 3-tier system continue to be ongoing and heated topics of debate in our industry. Recently I had the opportunity to attend my 25th Wine and Spirits Wholesalers of America (WSWA) convention, where I had meetings with principals from over 40 leading U.S. wine distributors. You may recall that in 2015 Oregon hosted WSWA’s important annual Conference for Leadership Development at which young distribution industry leaders are groomed for the future of an ever-evolving world of wine, beer and spirits go-to-market challenges. Many of these young leaders came away impressed with our industry.
It will be a reality for a long, long time that wineries will need to seek distribution to grow beyond a certain level. Small wineries can exist solely on DTC sales. But as wineries grow, I am convinced that they are very smart to diversify their routes to market. Sure there are margin tradeoffs. However, I feel strongly that even for small wineries a more diversified market portfolio approach – including a sampling of domestic distribution and also some international exposure – is smart business practice that may pay off big when the next recession, belt-tightening or fickle vintage occurs.
Several things are clear to me. As much as we like to tout the funnel theory of consolidation, the number of U.S. wholesalers is growing as startups find niches of opportunity and beer wholesalers scramble to diversify their portfolios into healthier spaces. There is also increased allure of small wine brands for both big and small wholesalers. Years ago wholesalers actually built brands and they made handsome margins to do that. This is often no longer the case. Margin shrinkage has hit big wholesalers hard and now they are realizing that they need to diversify their own businesses back into higher margin, higher value added spaces and build businesses that are more sustainable for the long run. It won’t happen overnight but the signs are there.
As an example, in March, Southern-Glazers Wine & Spirits, the largest wholesale agent of wine in the world, brought 60 of their top executives to Oregon for four days. Along with that, SGWS is moving to create and fuel small artisanal divisions in their states, run independently by Master Sommeliers who have a free hand to own their portfolios for real return on investment for their companies and their winery partners. SGWS already has similar operations running in markets such as Florida and Colorado, and more will come. Their competitors will respond in like fashion.
The challenges for our wineries now are more about their own brand identities. Is your story sharp, your brand focused, your SKUs fully rationalized and your logo, artwork and labels consistent, polished and ready for prime time? Done right, a winery will not be compelled to go out and sell every case. The objective should be to create real brand pull. Effective distribution can be a powerful engine that only makes your DTC piece more viable and profitable. However, you must take the steps to sharpen your business plan and build your “A-game” to be ready for the challenging world ahead while riding the wave of an ever more globally viable “Brand Oregon.”
Cheers,
Steve Thomson
Chairman
Oregon Wine Board
MARKETING
Nominate an Oregon Wine Month Rep of the Year
Oregon Wine Month would not be possible without the hard-working distributor sales reps that call on top accounts, get those by-the-glass features and secure incredible retail display activity. In recognition of this, the OWB will honor two distributor sales reps as Oregon Wine Month Reps of the Year based on performance during May 2017. Who do you know that deserves to be recognized with this award? Learn more and submit a nomination by Jun. 15.
It’s (Still) Oregon Wine Month!
Let’s keep Oregon Wine Month going strong through the end of May! We are up to 300 events on the calendar, with 150 participating restaurants and dozens of retail locations getting in on the action. Help keep the momentum up through your Memorial Day events by participating in the #oregonwinemonth social media campaign. Get social media tips and images to post.
What is Your Winery or Vineyard Planning for the Eclipse?
As you’re no doubt aware, a total solar eclipse will roll across Oregon on Aug. 21, plunging parts of the Willamette Valley into darkness and attracting millions of visitors to the area. The OWB will be sharing winery and vineyard eclipse events through our social and newsletter channels throughout the summer. Post your eclipse events to the calendar.
Update Your Online Tasting Room Profile
The OWB’s newest resource for Oregon wine country visitors is an online database of 500 tasting rooms, searchable by nearly 50 unique parameters. To capture the most visitors for your tasting room, be sure to claim and customize your listing. Read more and find out how to update your profile.
We’ve Updated the Oregon Wine Resource Studio
The innovative Oregon Wine Resource Studio is a mobile-friendly website that houses a comprehensive suite of information and assets illustrating the distinctive aspects of terroir and culture that combine to make Oregon a world-class winegrowing region. Free downloadable, customizable presentation materials are publicly available, enabling anyone to learn about, train others on or sell Oregon wine. See the updates and additions that were made available May 1.
INTERNATIONAL MARKETING
Opportunity to Meet Buyers from China
Wine producers are invited to meet with 20+ buyers from China at an event sponsored by the ODA on Jun. 21 and 22. The deadline to register is Jun. 5 and the cost to participate is $20. Get more details on how to register.
Mexico Consumer-Oriented Inbound Trade Mission
Companies interested in the Mexico market can meet one-on-one with pre-screened qualified buyers from leading retail chains during an inbound trade mission in Portland on Jul. 24-25. The mission is sponsored by the Western U.S. Agricultural Trade Association (WUSATA). The deadline to register is Jul. 17 and the cost to participate is $15. Get more details and register to participate.
Korea Consumer-Oriented Inbound Trade Mission
Tap into Korea’s large and growing consumer-oriented products market by participating in an inbound trade mission sponsored by the Western U.S. Agricultural Trade Association (WUSATA) on Jul. 24-25 in Portland. The deadline to register is Jul. 17 and the cost to participate is $15. Get more details and register to participate.
EDUCATION
Date Change: Introduction to Sensory Evaluation of Wine
Enhance your critical tasting ability and learn the basic aspects of sensory evaluation at a two-day course held at OSU on Jun. 3-4. The course will be taught by Dr. Elizabeth Tomasino, sensory scientist in Food Science and Technology at OSU and the Oregon Wine Research Institute. Learn more or register.
Replay of Silicon Valley Bank’s DTC Wine Sales Videocast
On May 17, Silicon Valley Bank presented a live videocast about the latest trends in direct-to-consumer sales. SVB also shared the results of their 2017 Direct-to-Consumer Wine Survey and discussed the highlights. Watch a replay of the videocast.
Participate in the Wine Industry Immersion Program at Linfield College
The Wine Industry Immersion program at Linfield College runs every Tuesday and Thursday from Jun. 13 through Aug. 3. Each session is taught by a diverse set of seasoned industry professionals, encompassing the wine production process from vineyard to table. Learn more or register.
Save 15% on Upcoming WISE Academy DTC Classes
Popular Oregon Wine Symposium presenters WISE Academy are hosting a series of classes on DTC sales and marketing in the Willamette Valley during June. They are offering employees of Oregon wineries 15% off registration. See the class schedule and get the discount code.
RESEARCH
Updated Spring 2017 Weather and Climate Summary and Forecast
On May 10, Dr. Greg Jones of Southern Oregon University published an updated Spring 2017 weather and climate summary and forecast. This report looks back at April conditions, provides an updated drought watch, and forecasts May, June and July 2017. Read the report here.
Research Update: Identifying Compound(s) Responsible for Off-flavors Associated with “Stressed Vine Syndrome” in Pinot noir
Dr. Michael C. Qian, of the Department of Food Science and Technology, Oregon State University and Oregon Wine Research Institute, has prepared an update on research he is leading to identify compound(s) responsible for off-flavors associated with “stressed vine syndrome” in Pinot noir. This project receives funding from the Oregon Wine Board as part of its viticulture and enology research grant program. Read Dr. Qian’s research update here.
CALLS FOR WINE
Last Call to Submit New Release Wines to The Wine Advocate
Honest Cooking is seeking wines to include in its two new wine guides for summer: Stellar Summer Sparklers and Rocking Rosés. The submission deadline is Jun. 1. Read more and get submission details.
Enter the 2017 San Francisco International Wine Competition
Now through Jun. 2, submit wines for the 2017 San Francisco International Wine Competition (SFIWC). Now in its 37th year, SFIWC is the largest wine competition in America, and among the most influential. Get details on entering the competition.
Submit Wines for the 2017 Oregon Wine Competition
All Oregon wineries are invited to submit up to five wines to the 2017 Oregon Wine Competition with judging Aug. 5-6. The competition is associated with the Oregon Wine Experience, which showcases the full breadth and depth of Oregon wines. The deadline to submit is Jun. 9, and all proceeds benefit Asante Foundation, a designated Children’s Miracle Network hospital. Read OWB education manager Bree Boskov MW’s blog post on why wineries should participate, and get details on how to enter.
Enter Sip Northwest’s Best of the Northwest 2017 Competition
Sip Northwest is now accepting submissions for its sixth annual Best of the Northwest issue, which will come out in October. The wines will be tasted blind, with a panel comprised of the Northwest’s top palates, judges and professionals. Entries are due by Jul. 10. Read more details and get submission information.
Submit Wines for the 2018 BRIT Sustainable Winegrowing Competition
The BRIT International Award of Excellence in Sustainable Winegrowing competition recognizes wineries with a “ground to glass” attitude towards sustainability. The competition focuses on taste as well as the three tenets of sustainability: environmental, economic, and social. The deadline to enter is Jul. 31. Find out more and get entry details.
OTHER NEWS
Travel Oregon Matching Grants Application Period Opens Jul. 10
The Travel Oregon Matching Grants Program makes awards available to eligible applicants for projects that contribute to the development and improvement of local communities throughout the state. The application period for the next cycle of Competitive Small Grants and Oregon Wine Country Plates Grants opens Jul. 10. Draft guidelines are available to download to help you start preparing your application. Get more details here.
Chehalem Winery to Donate $40,000 in Wine
On May 15, Chehalem Winery launched its inaugural Making a Case for Giving campaign to celebrate Oregon Wine Month. Chehalem plans to give away at least 100 cases of wine to charities in Oregon and the Vancouver, WA metro area. Share this opportunity if you know of charitable organizations that may be interested in applying by the Jun. 15 deadline. Get details here.
Oregon Coast Aquarium Seeking Wineries for Major Donor Event
The Oregon Coast Aquarium in Newport is celebrating its 25-year history, and embarking on a major capital campaign to remodel and expand. They are seeking 10-12 Oregon wineries to pour at an invitation-only VIP event for 250-300 major donors and charter members on Jul. 21.Read more about the event and get contact information to participate.
Attend the ShipCompliant Wine Summit
The 2017 ShipCompliant Wine Summit will take place on Jun. 8 in Sonoma County, CA. This one-day intensive is filled with experts sharing knowledge and experience specifically focused on the wine industry. Get more information and registration details.
Northwest Wine Night Radio Now Booking Guests for Fall and Winter
Northwest Wine Night Radio is now booking guests for fall and winter. There is no charge to appear, and this opportunity is for anyone who hasn’t been on the show in the last 18 months. Find out how to sign up.
Come Share Your Winery’s Story with the OWB Team
The OWB team always likes getting to know the wineries and vineyards we represent. Wineries are invited to OWB’s office to share their wines and brand story with us at 3:30 p.m. on Fridays. This is a great opportunity for you to get to know our organization better, ask questions of us and share your suggestions. Learn more and sign up for a visit.
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