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For small family wineries, the Central Coast is the new Napa/Sonoma

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I was reading this article from New Zealand in which this “pioneer of Marlborough wine says that the corporate-dominated New Zealand industry is making it harder for family-owned wine businesses like his to survive.” It immediately brought to mind the comment, which you hear frequently, that the largest wine companies also are crowding out smaller, family-owned wineries in America, including here in California.

This plaint (not complaint: a very different word) has long roiled California’s waters. I heard it nearly 25 years ago when I started writing about wine. It still makes the rounds today, when giant companies like Constellation, The Wine Group, Bronco, Gallo, Treasury, Trinchero, Diageo and Ste. Michelle account for the lion’s share of every bottle of wine sold in America.

I know for a fact that it’s hard for the small family winery to compete. They have trouble getting into the distribution system, that most conservative bastion of the industry. Government, both state and Federal, continues to block the free interstate direct shipping of wine. Their mom-and-pop staffs are over-burdened and barely able to keep their heads above water. They depend on those two most undependable factors, word-of-mouth and customer loyalty, either or both of which may disappear at any moment. And they are frequently overlooked by the critical media, in a way that’s unfair, but inevitable.

Still, for all their travails, the small family winery never has gone away in California, and as far as I can tell, is nowhere near being an endangered species. I continue to be impressed all the time by the number of new brands I discover almost everyday, and by the passion and tenacity with which these often-young proprietors tackle the challenges.

I’m thinking of such producers as Ian Brand (Le P’tit Paysan, La Marea), Sabrine Rodems (Scratch), Matt Villard (MCV), Brian Brown (ONX), Eric Lauman (Cambiata), David Galzignato (Jada), Daniel Daou (Daou), Aaron Jackson (Aaron) and so many others. All have stared the marketplace straight in the eye and decided they can do something different, and better, than anyone else. If you think about it, that’s an insane attitude. Almost everything that can be done in California wine is being done, and even if you can find a niche no one else is exploring, there’s no guarantee you can sell the resulting product. In fact, there’s every indication you can’t. (See paragraph 3, above.) Yet despite the odds, these young winemakers are giving it a go.

You notice that all them are from the Central Coast. That’s no coincidence, in my opinion. It’s too expensive to start up a business in Napa and Sonoma, but from Monterey down through Paso Robles, the price of admission isn’t as high. (Who needs another 94 point Napa Valley Cabernet Sauvignon anyway? There’s already too much.) The exciting thing is that these winemakers are ready to take risks and try new things. The template in Napa-Sonoma is largely closed. In the Central Coast, it’s wide open, and these adventurous winemakers know it. They have the spirit of experimentalism that Napa Valley had 40 years ago. The Central Coast is the new frontier in California, and I can’t wait to see the fantastic wines from the small family wineries that will be coming out from there.

  1. Here in Healdsburg (Russian River, Dry Creek, Sonoma Coast, Alexander Valley et al), it’s fairly easy to get the production for small winery setup, what next to impossible is to setup an avenue to actually sell your product.

    The 3 Tiered system (even if you wanted to be in it) is pretty much closed to the little guy now, and getting a tasting room in a well trafficked wine centric location is even harder.

    We did it, but it was part of a multi-year plan, and were helped by the great recession, and my obsessive following of the local real estate market.

  2. Ryan Flinn says:

    Eric — has Amazon selling wine had an impact on smaller family operations looking for another avenue to sell to consumers?

  3. The Sales so far on Amazon have not been significant. In fact, it does not yet even pay for the compliance.
    However, I suspect like the proverbial turtle and hare, that Amazon will develop a valid alternative to classic distribution over the long haul.

  4. It’s funny you mention Onx, Jada and Daou– all relatively new wineries as “staring the market place straight in the eye.” All wineries founded by families with monies from another industries and started as vanity projects. If you want to talk about family owned and operated wineries on the Central Coast that have truly had to pound the pavement and stare the market place in the eyes, you’ll have to go a little further back to the mid 90s with the true pioneers of the area– Alban, Linne Calodo, Saxum, Villa Creek, L’Aventure, etc. If it weren’t for these wineries, the aforementioned wineries in your article would have no solid base to compete in the marketplace today.

  5. Steve,

    A few points here – and though they may seem minor, to me they are not:

    All examples you used were certainly ‘Central Coast’ but you really should say Paso and Monterrey Counties at this point, because none of these examples were from Santa Barbara County.

    Yes, I KNOW that you know about us down here and that you do cover us extensively, and I for one certainly thank you for that . . . but I really think it’s becoming more and more important to ‘break apart’ the Central Coast into the distinctive parts that it is. For example, I’m not sure the last time I saw a major reviewer say ‘North Coast’ when referring to those producers along the Sonoma Coast, or Russian River Valley, or Mendocino County – for the most part, they are broken out individually . . . .

    But off my soapbox and back to the gist of your blog post – yep, there are still plenty of opportunities for us ‘small guys’ in the marketplace these days, and in some ways, it’s easier than ever. Now that is NOT to say that it is easy – I am still running a ‘non-profit’ winery, for instance (-: But there are many many more avenues for wineries to explore for getting the word out about their wines, and I’ve seen some wineries go from scratch to instant profitability using the exposure they get on Facebook, Twitter, in blog posts, attending the various tasting events that are out there, etc . . . More avenues, but just because the opportunity is there does not mean there are any guarantees of success – that’s for sure . . .

    Cheers

  6. Anyone who wants to start a label should always remember to start small, like REALLY small. Can’t tell you how many times I’ve heard people say “yeah, let’s do something small, like 1000 cases!”

    Of course next to the millions of cases consumed annually in the US 1000 cases is small, but that still means you have 12,000 individual sales to make. 12,000 times this year (because there’s always the next vintage!) that someone has to choose your bottle to drink over all their other options, and there has never been more options.
    That being said, there are heaps of new, small, awesome labels being incubated in winery cellars or in custom crush all around California. Overhead is small, passion is high, and aspiring winemakers will always chase romance (even if in reality we know winemaking is mostly just cleaning sh*t :-) ). If anyone finds themselves touring a cellar anywhere in CA make sure to ask the assistant winemaker and/or cellar master about their side project, there’s a good chance they have a barrel or two they’re playing with.

  7. Larry, actually I wanted to particularly shout out Paso and Monterey, although I might have mentioned any number of wineries/winemakers in SBC whom I admire. But I do tend to think of SBC on its own terms, not Central Coast, so you are right, we do need to be more careful to break CC apart into its components.

  8. bonnie, you are absolutely right. I have written about the wineries you mentioned many times over the years, both in the magazine, in my books and on my blog. This time, I wanted to write about the new-new wineries and winemakers in PR and Monterey. It doesn’t matter to me whether they began rich or poor (and I think the term “vanity project” is perjorative). The important thing is they’re making wines of distinction in these two areas.

  9. Steve,

    Thanks – but then next time, just say Paso and Monterrey, eh?!?!?

    It’s not you, it’s me – I just am ‘challenged’ by the fact that when most folks say ‘central coast’, they mean paso these days . . . and yet SBC gets thrown into that mix as well.

    There is nothing ‘wrong’ with Paso and environs north – I just think our wines are very distinct from theirs and should be looked up differently – that’s all . . .

    Have you had a chance to talk with the new ED for our area? Me thinks you’re going to like her.

    Cheers!

  10. larry: What is an ED? Executive Director?

  11. Steve,
    I always enjoy reading your posts, and this one in particular is interesting to me. I think that you are right on with the Central Coast being the new frontier, and because I believe it so much, my family and I have become one of the “new” small wineries giving it a go there. As you mentioned, there is not much these days that we can really do different, that hasn’t already been done, but we feel we have changed things up just a little bit anyways. We decided to take our wines, made off our estate in the heart of the Central Valley, Lodi in particular, and pour them in our new tasting room in the heart of the Central Coast, Carmel Valley Village. We feel strongly about the quality of wines that we produce, as well as the many other winemakers, from the Lodi AVA, and we believe that they should be shared in the most up and coming wine areas in California. There is not a lot about us that is “conventional”, but we like it that way. We think that even though our wines are not very classical in style sometimes, we should still put them up against the best wines, and winemakers, and let the public decide what they think, and that is why we chose the Central Coast as our second home. We too are excited to see the Central Coast grow, and to see what we can do with our wines to become a part of the mix. Cheers!

  12. Larry, Morgen will do a great job!

  13. For many “winemaker” wineries being a not for profit winery is not an option. When the initial savings are gone, the brand goes away. The wine is usually better than most but the market place is crazy crowded and no one has the money to hire sales and marketing help. I thought it was crowded in the 90s but today is bonkers insane. I’m saddened when I see talented winemakers selling insurance or solar panels but I guess it pays the bills.

  14. Liono: Bonkers insane. Gotta remember that one! Thanks.

  15. My partner and I are starting a wine shop in Sonoma County. We would love to have our initial inventory loaded with a small wineries product than purchasing through a big distributor. It provides an eclectic product mix for our customers and allows a small winemaker to make ends meet. How do we find these wineries that are skipping the crazy 3 tier distribution system?

    Michael
    michael@rvwineandbeer.com

  16. Michael, maybe some small wineries that read my blog will reach out to you. Also, try the regional winery associations.

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