Tag Archives: Whole Foods

Amazon, Whole Foods, and wine prices

amazon whole foodsDon’t expect the Amazon-Whole Foods deal to change wine prices for the better at the upscale grocer

Know one thing first – no matter how much wailing, gnashing of teeth, and rending of garments we’ve seen in the cyber-ether, Amazon’s purchase of Whole Foods will mean almost nothing for wine prices or the wine business.

There are a variety of reasons for this, but the three most important are:

• Amazon bought Whole Foods for reasons that still puzzle people who understand grocery stores. Whole Foods has about 440 stores in the U.S., hardly enough to matter against Walmart’s 4,200 or Kroger’s 2,800. The best guess why the deal happened? Whole Foods’ 400-some warehouses, about four times a many as Amazon has.

• Whole Foods is not a wine retailer; it’s a grocery store that sells wine, and does so at higher markups than most retailers because it’s an expensive grocery store. The days are long gone when I went to Whole Foods to find a deal. This is the store that sells the $5 Rene Barbier for 40 percent more than most Dallas retailers.

• Our old pal three-tier, which restricts how Amazon can sell wine through Whole Foods. Again, the couple of high-profile Amazon wine projects that got so much attention recently weren’t about Amazon selling wine, but about Amazon listing the wine for sale and then sending you to another website to make the purchase.

In fact, my most recent visit to Whole Foods reminded me why the chain was in such trouble before the Amazon sale. It’s still pricey, despite all the cost-cutting publicity; $2 for a container of yogurt is three times the usual grocery store price. And a Gascon white wine I bought elsewhere for $10 was $13. In this, it reminded me of the Neiman Marcus department store chain, whose customers aren’t supposed to care about price, either. And Neiman’s is in trouble, too.

Winebits 385: Whole Foods, Big Wine, Cameron Hughes

whole foods ? A new format: Whole Foods, the word’s most powerful natural grocery store chain, said last week it would launch a second, less expensive version aimed at 20-somethings who can’t afford to shop at the grocer. This is mind boggling, if only because no one has ever attempted it — like Walmart doing an upscale grocer to attract aging urban Baby Boomers who think Walmart is beneath them. It also probably won’t work, or else it would get a separate post, because Whole Foods Jr. could wreak havoc with the wine business. That’s because, assuming wine will be as important to Whole Foods Jr. as it is to the parent, the chain will have to stock cheaper wines without the noxious markups it currently uses, like Chateau Bonnet for $16. That means private label wine on the scale of Trader Joe’s, which Whole Foods Jr. sounds suspiciously like. And if that’s the case, all the gloom and doom about the end of the cheap wine business in California will be over. All that Whole Foods Jr. $5 wine will have to come from somewhere, and that’s what California’s Central Valley exists to do.

? No, no, Big Wine: The Wine Curmudgeon is finally and apparently not the only one who has noticed the role Big Wine plays. A group of northern California activists met last week to call for a halt to Big Wine’s growth in wine country. “They hire a chef before a wine-maker. This has to stop. We cannot let them pave over more of our ag land,” said one of the speakers. In this, the new group may be echoing what has happened in France over the past 20 years, with farmers and vineyard owners protesting Big Wine in its European guise of internationalization.

? Bankruptcy? The company that owns Cameron Hughes, the wine geek’s favorite discounter, has been forced into receivership and a sale or merger is possible, reports Lew Perdue at Wine Industry Insight. The bank holding Hughes’ debt forced the action, which is often part of a bankruptcy. In this case, though, says Perdue, that probably won’t happen, and the receivership appears to be part of tug of war between the company and its bank over unpaid loans. The Hughes parent company issued a statement saying it was trying to reach an agreement with the bank to restructure its debt and would continue in business.

The Five Day, $3 Wine Challenge

$3 wineThe Wine Curmudgeon talks a good game when it comes to cheap wine, but does he follow through? This question, always important, is even more critical with the upcoming publication of The Cheap Wine Book (just a couple of weeks away). Hypocrisy has no place in what I ?m trying to do.

Hence The Five Days of $3 Wine Challenge, which starts tonight and runs through this week. Each night, I ?ll drink a $3 wine with dinner and attempt to answer the question: Can a wine drinker live on really cheap wine? Are the claims made by producers like Fred Franzia and the various anti-critics true, that most of us can ?t tell the difference and that it doesn ?t matter if we can?

No one supports cheap wine more than I do. But being cheap isn ?t enough ? quality matters, and my experience over the past decade of drinking very cheap wine is that the quality of these wines is often lacking. So we ?ll put that to the test this week with these five wines, all chardonnays and all purchased in Dallas:

? Two-buck Chuck ($2.99), the Trader Joe ?s private label that was the first and remains the most famous of the very cheap wines. It ?s a California wine from the 2012 vintage.

? Three Wishes ($2.99), the Whole Foods private label. It carries an American appellation, which means it ?s non-vintage and at least three-quarters of the grapes used to make it were grown in the U.S.

? Winking Owl ($2.89) from Aldi but that may be available elsewhere. Also American and non-vintage.

? Cul-de-Sac ($2.96), a private label for Central Market, the high-end chain owned by Texas ? H-E-B, one of the largest privately held companies in the country. Also American and non-vintage.

? Oak Leaf ($2.97), the Walmart private label. Also American and non-vintage.

Why chardonnay? To give the wines the benefit of the doubt, since chardonnay is the easiest cheap wine to make well. And I won ?t pair the wines with anything that would show them up ? no cream sauces or haute French cuisine.

I ?ll post the results of the challenge next Monday, but you can keep up with the day-to-day action by following me on Twitter or checking out the Wine Curmudgeon Facebook page.

Each wine uses the same kind of bottle ? light and without a punt (the hollow in the bottle ?s bottom). And all but the Two-buck Chuck have the same foil and foil design, which isn ?t surprising since each is apparently made by The Wine Group, one of the Big Six and whose brands include Cupcake.

Winebits 273: $10 wine, Whole Foods, $500,000 theft

? Consumers still want $10 wine: Most of the wines that made this year ?s IMPACT ?s Hot Brands list, which identifies the top growing labels in U.S. stores, cost $10 to $12. Said the report: ?The results clearly indicate that consumers continue to gravitate to the $10-$15 area at retail. ? These wines all sold at least 250,000 cases, and the criteria for making the list depend on how long the label has been around, but emphasize growth from year to year. The names of the brands are behind a paywall, but it almost doesn ?t matter what they are ? price is what counts here, and consumers have apparently found their happy place and aren ?t leaving.

? How Whole Foods buys wine: W. Blake Gray interviews the specialty grocer ?s Northern California wine boss, Joseph Kaulbach, which is a coup itself: Whole Foods doesn ?t often agree to those things. But the piece is also worth noting for Kaulbach ?s emphasis that Whole Foods, in its approach to wine, is a grocery store first and foremost; that Three Wishes, its version of Two-buck Chuck, exists because Two-buck Chuck exists; and that the northern California market is unique, and especially when it comes to defining local.

? The great wine robbery: As if the Australian wine business didn ?t have enough problems, how about the theft of almost 4,700 cases of wine, worth A$500,000 (US$517,000)? The thieves had their own trucks and forklifts to move the wine, and their own warehouse to store it, say police, who seemed impressed by the effort. Hence, consumers should be wary if they ?re approached by someone on the street who offers to sell them discounted Aussie wine with a wink and a nod, or looks and sounds like Michael Palin.