This week’s wine news: Catching up with what’s going on that isn’t about rose
• The future of expensive wine: Esther Mobley, writing in the San Francisco Chronicle, asks whether the coronavirus pandemic “will make luxury Napa Valley wine less relevant?” It’s one thing for me to write that on the blog; that’s the Wine Curmudgeon’s reason for being. But it shows old-fashioned newspaper gumption for Mobley to do it, since the Chronicle is the paper of record for luxury Napa Valley wine. Because as soon as I saw the piece, I knew Mobley’s bosses would be getting a variety of nasty emails, texts, and phone calls. “How dare she write something like that?” would have been the general tone.”We need her support more than ever, and she is tearing us down!” That’s when they usually threaten to pull advertising. And how do I know about stuff like that? Let’s just say it happened once or twice during my journalism career. Hard to believe, yes?
• Grocery Outlet thriving: Grocery Outlet’s sales increased 25 percent during the first quarter this year, as shoppers flocked to the discount chain as food prices increased elsewhere. Grocery Outlet is known on the blog for its quality cheap wine, but its other prices can be as much as 70 percent lower than full-service supermarkets. That has helped the chain, with stores mostly on the west coast, attract shoppers who are still looking for value despite the pandemic, say analysts.
• U.S. drinking laws: The BBC takes a look at how U.S. drinking laws have changed during the duration. The story isn’t the news organization’s best reporting – it’s too long, unfocused, and depends on weak sourcing (trade lingo!), but that it did the piece at all speaks to the momentous changes that the pandemic has brought to U.S. liquor regulations. Which, of course, you read here first. It also includes the obligatory quote from a U.S. medical official saying that we’re all burn in hell if we don’t stop drinking so much.
Grocery Outlet, the west coast discount supermarket, wants to use cheap wine to help it expand across the country
Grocery Outlet, the west coast discount supermarket, wants to expand across the country. Can it do so in this age of Walmart, Aldi, Trader Joe’s, and all the rest? And if it does, can it spread the gospel of quality cheap wine?
That’s the question I tried to answer in a freelance piece for Meininger’s Wine Business International. Grocery Outlet’s plans are ambitious: Expanding from 332 to some 4,000 stores as it moves east — and, say company officials, with cheap wine a key to that expansion.
So why should we be so excited about wine at Grocery Outlet?
For one thing, there are 50 wines in each store that cost $5 or less. For another, those 50 wines are usually not bottom-feeders like Winking Owl. Rather, it’s branded wine from producers we’ve heard of, but that the company buys as seconds, remainders, and discounted items from wholesalers and wineries. And Grocery Outlet is famous among California wine geeks for discounting expensive wine, which it sells for as much as 50 percent off.
This isn’t a new business model for retailing, but it’s very unusual for wine. For one thing, three-tier makes it more difficult than selling overstocks of canned soup. For another, it means each store’s selection changes depending on what the chain can find to discount, so the great $5 wine that was there the last time may not be there the next time. Third, it doesn’t usually stock national brands like Barefoot or Kendall-Jackson, which isn’t the conventional wisdom.
“What we’re doing, and we’re doing it every day, is to find wine through the normal channels, but that it’s wine that we can sell at the right price,” says Cameron Wilson, Grocery Outlet’s director of wine, beer, and spirits. “But what we’re also doing is upgrading the technical quality of the wine we carry, so that everything we carry is in good shape and that it shows well.”
Which sounds like a fine reason for us to care about Grocery Outlet’s success.
This week’s wine news: Tom Wark asks how distributor consolidation fits into the legal framework that guides three-tier, plus wine discounter Grocery Outlet goes public and the role of wine in the battle of Agincourt
• Distributor consolidation: Wine marketer Tom Wark’s take on the recent RNDC-Young’s Market merger is well worth reading. “It has long been a near unbreakable tenet and motivation of state alcohol regulation that no single company be allowed to control too great a portion of the market,” he writes. So Wark wants to know: What will regulators do about the merger, since it means three companies will control more than 60 percent of wine and spirits distribution in the U.S.? In this, he forces the regulators’ favorite argument in favor of three-tier on its head. Regulators have insisted for more than 80 years that we need three-tier to protect us from the abuses of one company controlling too much of the market (also known as Al Capone during Prohibition). Some of the post is inside baseball, but Wark’s point is well taken – distributors and regulators can’t have it both ways.
• Bring on the cheap wine: Grocery Outlet, the supermarket discounter that’s all but worshiped on the West Coast for its cheap wine deals, went public last week. Shares traded at almost double the initial estimate, which means I’m not the only one excited about the chain’s expansion plans. The company’s president said Grocery Outlet wants to move off its California base, opening 32 stores this year, 2,000 in the near term and as many as 4,800 stores nationwide over the long term.
• Lots and lots of wine: Ever wonder how much wine a medieval army needed when it went on campaign? England’s Henry V, in his invasion of France in 1415 (memorialized in Shakespeare’s “Henry V,” which includes “Once more unto the breach, dear friends“) took 4,000 casks of wine. Rupert Miller, writing in the drinks business trade magazine, says no one is quite sure how much wine was in a cask, but notes that Henry had to provision a 12,000-man army (plus servants). So it was probably a lot. The piece is very history geeky (which is why I liked it), but does offer some perspective on wine’s role in the pre-industrial world, when water wasn’t safe to drink.