Editor's Letter

 

Basking in the Sunshine of Success

November 2014
 
by Jim Gordon
 
 

Heading into the biggest wine-buying and wine-consuming time of year, the wine industry seems to be enjoying a victory lap as it savors the progress it made in the past five years. While many know that lean periods always follow fat ones, there’s nothing wrong with basking in the sunshine of success when you can.

Our Wine Industry Metrics section shows how well things are going from a data perspective. September was yet another month when off-premise sales, direct-to-consumer shipments and winery hiring activity rose compared to a year ago. It’s been 18 months since any of these three metrics declined for even a month.

Confidence among suppliers
Confidence among wine industry supplier companies has shown just as big a turnaround as among winemakers, but it seems that the suppliers came a bit later to the party. See managing editor Kate Lavin’s annual survey of supplier and vendor companies. Wines & Vines started the survey in 2008, just as the bank crisis hit, and no one knew how bad it would become. By late 2011 wine industry companies hit the low point in terms of financial health, based on this assessment of suppliers. When asked about their clients’ ability to find cash or financing to pay for their products and services, only 13% said the situation was improving in 2011, while 59% said it was getting better this year.

A whopping 85% of suppliers said they now expect the industry to expand in 2015. And guess what? Fifty-five percent of suppliers plan to raise prices in the next 12 months. To their credit, it appeared the suppliers have been just as busy as wineries while innovating their way out of the recession. Reading through the 44 pages of our 2014 Winery & Vineyard Supplier Guide, you can’t miss the great number of new products and services the product and service providers just introduced or are planning for 2015.

Northwest land grab
One very visible sign of industry confidence is the recent action in vineyard property transactions, especially in Washington and Oregon. Senior correspondent Paul Franson reports on “What’s Behind the Northwest Land Grab.” Ten major vineyard/winery acquisitions have taken place since October 2010, Franson writes, based on a presentation by Josh Grace of International Wine Associates at the Wine Industry Financial Symposium.

At the same symposium, professor emeritus Robert Smiley of the University of California, Davis, Graduate School of Management unveiled his team’s annual survey of wine industry leaders. Smiley and co-author Michelle Nishikubo write up the survey results in the Practical Winery & Vineyard section of this issue.

The wine executives said they are aware that this is a time of great change in California wine, and they recognize that they must adapt to pressing issues including a generational shift in consumers and the drought threat for vineyards. It’s worth your time to find half an hour, sit with a cup of coffee or maybe a glass of Zinfandel, and soak up the wide-ranging and sometimes contradictory opinions in this article.

We love articles that question the conventional wisdom. Contributor Carol Collison’s report, “Will 500 West Coast Wineries Sell?” focuses on ownership transition. To research the piece, she consulted Wines & Vines’ extensive records to determine how many wineries sold vs. quietly going out of business in the past 10 years. And with that she makes her own prediction about how many will be sold in the next five years.

Winemaking and grapegrowing
We think winemakers and winery owners will be envious when they read associate editor Andrew Adams’ Technical Review about Sonoma Valley’s new Hamel Family Wines. The Hamel family completed one of the most modern and well-equipped wineries in their area in time for the 2014 harvest.

For a glimpse of what’s happening in Walla Walla, Wash., read Laurie Daniel’s interview with winemaker Chris Dowsett, who discusses how he uses concrete fermentors and the advantages of Syrah grapes from The Rocks district for reds.

Eastern winemakers faced more than their share of challenges during the 2014 growing season, with killing winter freezes and a cool wet summer in some places. In “Vinifying Grapes From Difficult Climates,” Wine East editor Linda Jones McKee passes on advice from enology professors and researchers about dealing with green flavors, out-of-whack acid-pH and other fundamental challenges.

All of us at Wines & Vines hope you didn’t have too many of those problems during your 2014 crush, and we hope that you have plenty of successes to reflect on as the vines go dormant for the winter.

 
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