Disscussion

There is an urgency felt amongst boutique winery community to establish some form of supplement linkage in new markets.

The urgency is rooted in the current and forecasted condition of our own economy and the current movement of California boutique wine sales. Our economic condition is closely linked to the Real Estate market which is expected that this lull in our economy is not only going to worsen but will last for the next 5 to 8 years.

As winery owners pointed out 45% of our state is employment is within the service industry. With such a large portion our spending now frozen due to cost of living increases. Boutique winery owners are expected to now sustain operation without sales. This of course is not only impossible to achieve, but will also dampen many of California’s inner economies in the process.

It is feared that this is a trend that is already taking place. I’ve met with numerous boutique wineries that stated they have been barely able to move any wine for the last 2 years. Of course there is a spike of interest during the holiday seasons. But that is only temporary. And many are sitting on stock piles of inventory. As one winery owner pointed out he has an additional 15 acres he would like to plant but won’t because he can’t sell the product he has now. This means the winery is not using all its resources to sustain itself and make a profit.

This is a problem that is easily rectifiable if California wineries bound together a looked at markets in a global context. This is the strategy of the Australians, and South African wineries and it seems it’s paying off.

A problem that faces all wineries as such this is a matter that needs to be addressed as a unified community. This means California wineries need to first move away from the fragmented posture of going for owns label and unify together and develop a support structuring that all can benefit from.

The point is that as consumers pull back and distributors begin receiving signals that customers are no longer buying, distributors will eventually freeze wine purchases as they are already overly saturated.

At the core the purchase of wines is an investment and once an investment is not able to produce a yield. Particularly a commodity like wines that not only will the wineries loose out but the whole state of California will also suffer.

Many have associated the posture of our wineries as being similar to a small neighborhood store totally hinged on the local market of a couple blocks. We need to actively begin thinking and engaging in real world terms which means on global scale.

Your comments and thoughts are needed and appreciated. They are shared with various wine publications to help understand all factors California wineries will be facing.

Please send your comments to: wines@irdiworld.com