Bulk Wine Sales

Because we have been selling some boxed wines here recently, I thought I might blog about bulk wine sales. I found that a normal figure for what percentage of wine is sold in bulk; that is, wine that is bottled by the receiving party and not the producer or affiliate; that figure would be about fifty percent. That means "grown, produced, and bottled" or estate production, both domestic and imported, is now no more than half of what is out there on retail shelves.

Actually, since the recession started, bulk is trending up. Spain sells 57% of its production in bulk which explains my "Wine in Tube" and "Elvia Punt" boxed Spanish lines. According to Alex Walters of Austral Wine Merchants, importers of Elvia Punt, most any wine priced at ten dollar or lower, is likely to be bulk sourced. As I said in the previous blog, when a large wine company purchases a label and then gradually decreases the price for increased store placements and volume sales, that is an indication of bulk wine production and the end of the label's historic content.

One resource I found claimed the typical wine consumer has cut his wine budget in half with the recession. The chain stores coorespondingly now shelve bulk production replacement content for what used to be estate branded wines. If the truth be known, when a large wine company buys a small winery, they often buy just the name for its marketability. The vineyard and winery are just not necessary. Because the chains buy almost exclusively from large distributors selling wines represented by those largest suppliers, those players can shift to bulk at will since they have the facilities to do so within their respective domaines.

So here is what I think is the wine retail reality, circa 2012: 70% of retail sales are done by the thirty largest wine producers (more on this in the next blog); 26% of retail sales are imported wines, some of which are owned/marketed by the largest players; that leaves, optimistically, 6% of retail sales to be fought over by all of the small independent domestic wineries. One of my favorite movie lines from "Platoon" is, "There's the way things are supposed to be and there's the way things are."   C'est la vie!

This Friday from 5-7pm, Tommy Basham of Continental Brands will pour Peirano Estate Lodi Petite Sirah and Zinfandel (still family owned), Seis Circles Spanish White, Killer Bee Chilean Sauvignon Blanc, and Franco Serra Italian Barbaresco. Please join us.