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Lodi Growers-Turned-Vintners

by Tim Teichgraeber In the business of wine, the three most important jobs are growing grapes, making wine, and selling wine. Some rare individuals are good at all three, but they're the exception--not the rule.

A third-generation grower may be infinitely wise to the subtleties of farming but blissfully uninformed of the latest trends in tannin management. A brilliant winemaker may know nothing about international competition at particular price-points, and a marketing whiz who is cozy with Chicago buyers probably spends so much time on the road that she can barely keep a cactus alive in her own backyard.

The last couple of decades have been kinder to wineries, winemakers and wine sellers than they have been to grapegrowers. Grape prices fluctuate, and while there are certainly some farmers who get remarkable prices per ton, grape prices seem to have remained relatively low even as quality has improved.

Winemakers and wine sellers seem to have fared better, maybe because quality winemaking and marketing have bigger advantages in today's marketplace. Or maybe it's because there are just more ways to sell a brand than there are to sell a ton of grapes.

Today's wineries sell more than just wine. They sell tours and tastings, wedding facilities and 5-liter etched bottles. Wineries sell the wine country lifestyle in convenient kits comprised of a cookbook, a bottle of olive oil and a purple fleece vest. Every winery has a unique story, and you'll hear all about it for $200 per person at the winemaker dinner.

Any grower who has ever been paid $300 a ton for beautiful grapes or watched them raisin on the vine for lack of a buyer, has at some point wondered if he might be getting the short end of the stick.

Lodi Family Growers And Big Wineries

Lodi has long been a grower region. It's full of longtime family farms, many with precious old Zinfandel and Petite Sirah vines that resisted phylloxera in Lodi's sandy delta soils.

Big wineries like Gallo, Bronco, Constellation and its acquisition, Mondavi Woodbridge, and even some smaller coastal wineries, have long viewed Lodi grapes as a good value, but they sometimes take digs at Lodi's inland location, elevating the prestige of their more expensive coastal brands and keeping Lodi grape prices low.

In the past, Lodi's growers didn't make much of their own wine. Mostly they just sold the grapes to big wineries to supply value brands like Coastal Ridge, Mondavi Woodbridge, Turner Road or Sutter Home. Some large brands have come to focus on Lodi for affordable Zinfandel and Cabernet, and have featured the AVA prominently in their labels and promotions. You'll also see Lodi grapes featured in wines from the rarified likes of Turley, Rosenblum and Ravenswood.

Outside of California, Lodi has a better reputation than Napa wineries might imagine, and therein lies the opportunity for Lodi's growers.

Mark Chandler

If there's anyone orchestrating Lodi's rising prestige, it's Mark Chandler, the executive director of the Lodi-Woodbridge Winegrape Commission (LWWC). Chandler has been a key figure in focusing Lodi's growers on common goals, promoting the unique strengths of the region and advising growers considering producing their own wines. He is adept at public relations, and has succeeded in promoting Lodi as a wine country tourist destination for residents of the fast-growing Central Valley.

For Lodi's family growers, making and marketing their own wine brands has become an attractive option, if not a necessity.

Chandler says five factors are driving Lodi growers to produce their own wines:

1. The growers' desire to maximize return on the family land asset. Land costs on a farm owned by the same family for 100 years can be quite low. Making wine from the grapes grown there adds tremendous value, provided of course that you can sell it.

2. Family and regional pride. "Growers know that they're producing quality grapes, but they haven't always been able to see the grapes through to the end," Chandler explains.

3. Absorbing another generation into the operation. Chandler points out that these days, farm kids may go off to school and return with an MBA or a degree in enology. Becoming involved in winemaking and marketing may give the next generation an opportunity to apply its skills and interests to the family business.

4. The farmers' investment in the LWWC has opened doors for Lodi brands. Pooled funding has gone toward educational programs, a co-op tasting room for tourists and general public relations promotion of Lodi wines. Program manager Stuart Spencer explains, "We did a series of classes on starting a winery--10 classes over a couple of months dealing with everything from the regulatory issues to marketing and distribution. We offer our services to anyone interested in starting a brand, so that they can come in here and ask Mark or myself the appropriate questions."

5. Commodity grapegrowing isn't lucrative, and in some cases isn't sustainable. "Probably the biggest factor in that is the value of the land itself and development pressures in the area," Spencer says. San Joaquin is one of the fastest growing counties in the country. "In order for a grower to get a reasonable return on capital and assets, he needs to get a certain amount of income per acre." The answer for many is to go into the value-added wine production business.

Making The Move

In the last decade, many Lodi farms have started their own brands. Among the most widely distributed family-owned brands are Ironstone (which also produces Leaping Horse), Michael-David (which produces Earthquake, Incognito, 7 Deadly Zins and 6th Sense Syrah), Mettler Family, Jessie's Grove (Earth Zin and Fire), Klinker Brick, Van Ruiten and Vino con Brio.

Most will tell you that building their own brands hasn't been easy, but some, especially those who have gotten good advice along the way, have done r emarkably well. Others in Lodi are taking notes and following suit.

One of the most successful wineries to date was started by Michael and David Phillips of Phillips Family Farms.

As Phillips Family Farms, Michael and David Phillips grew winegrapes as well as other fruits and vegetables, and sold much of their own produce at markets and to restaurants in the extended local area. They also continue to operate a fruit stand, café and bakery that's a Lodi fixture. As Michael-David Winery, the Phillips brothers now channel virtually all of the grapes they grow into their own wine brands--Earthquake, 7 Deadly Zins, 6th Sense Syrah and Incognito. In the past they would have sold those grapes to Gallo, Constellation or Sutter Home.

The Phillips brothers started by making small amounts of wine that they sold through their own fruit stand, but in the 1990s they decided to make a strong move into wine production.

"Prices were dropping, and it was hard to find homes for the grapes. We had to get control of our own situation to survive. We had to make more wine and develop labels," Mike Phillips says.

Michael-David Winery is now something of a model for other Lodi growers moving into wine production. It has grown into a substantial group of brands with annual case sales in the six-figure range and continuing to climb.

A grower hoping to make, brand and market wine usually needs help in the form of consultants who can assure that the wine falls within marketplace quality standards, consultants to tell you what kind of winemaking equipment to buy, even refer you to distributors in other states.

Michael and David Phillips turned to consultant Barry Gnekow when they needed help. "Barry Gnekow has been our consultant for 10 years now, and he's been instrumental in making sure we don't make mistakes," Mike Phillips says.

Michael-David Winery is one of the greatest grower-to-winery success stories of Lodi. Mike Phillips says other Lodi growers aren't actually coming to him for advice on how to start their own brands, "But they are seeing what we do and seeing that it can be done. They're seeing that putting Lodi on the label can be useful for the brand.

"The (Lodi) Winegrape Commission has been a big part of the whole thing, too, with seminars and educational programs. We now have respect as a premium wine area," he says.

The proliferation of better quality wines carrying the Lodi AVA in the under $20 price range may be boosting the image and consumer perception of Lodi grapes around the country.

"It didn't happen overnight," Mike Phillips says. "It took a lot of marketing trips, and we're still doing that. It's kind of a nonstop thing. You have to go out there personally and market your wines. That's the biggest key to our growth--we're taking it personally and going out there and telling our story."

Key Consultant--Barry Gnekow

You'll usually hear Barry Gnekow referred to as a "winemaking consultant," but in reality he brings a bit more to the table. He's also one of the masterminds behind the phenomenal growth of the H.R.M. Rex Goliath 47 lb. Rooster brand that was recently sold to Constellation Brands.

Gnekow also consults with Mettler Family and Jessie's Grove, two other Lodi grower brands that are marketed by Bill Leigon's Wimbledon Wine Group. Bill Leigon is the other key figure behind Rex Goliath's success.

Gnekow has his own eponymous wine brand, as well as marketing experience as a sales representative. As a winemaker, he's something like the Heidi Barrett of California winemaking in the popular under $20 price range. Barrett makes wines that critics drool over, while Gnekow makes wines that hook consumers and keep them coming back.

Budding wineries often hire him for winemaking advice, but they end up needing more than that. They need to know what sort of equipment to buy, who to turn to for label design, legal advice or national marketing.

"I also give them strategic guidance as to what gives you a competitive advantage in the global market. Your business isn't hanging onto the family farm, anymore. It's selling wine, and you have to get that," Gnekow says.

Gnekow says growers looking to develop their own wineries need to start with a good-tasting product. Next they need to hit the road--to see the competition and see how they fit into the big picture. Labels matter, too.

"The market is so competitive now. Once you get out of California, nobody knows where wine regions are, except for Napa--they don't know where Lodi or Mendocino or Monterey are," Gnekow says. "Everywhere I go, they always think their plot of land is the most special place in the world, like people always think their kid is the smartest… and I have to tell them, 'You know, there are a lot of smart kids out there.'"

It's Not For Everyone

"I work with a lot of older winemakers or people who aren't very educated about winemaking… but you also find musicians who can't play music, and designers who can't make clothes that people want to wear. You go see a band, and the singer can't sing and the band can't play, but they like doing it," Gnekow says. Today that's not enough.

"If your motivation is to have fun… it's a business, and you're doomed," he adds.

A romantic, he's not, but Gnekow knows a thing or two about making wines that taste good and sell well.

"I don't make wine for myself. We're making it for the market, and what I believe the market really wants at a certain price-point."

Gnekow advises his clients, "You're not in the business of growing grapes. You're not in the business of selling art. You're in the business of selling wine.

"Lodi is a harder place than other areas. There's a long history of grapegrowing and winemaking here, but it's always been for large operations.

"They'd deliver the grapes to the castle and sit on one side of the moat. The drawbridge would come down and the grapes would go inside. Something mysterious would happen in the castle, and then the king would issue a proclamation that the price next year would be $400 a ton," Gnekow says.

"In Lodi they were kept in the dark. When they get out there they can see that it isn't that mysterious, and that the king isn't that much smarter than they are."

(San Francisco resident Tim Teichgraeber is the regular wine columnist for the Minneapolis Star Tribune, a frequent contributor to The Wave Magazine, and books the remainder of his schedule as an entertainment lawyer for the likes of Dillinger Four and Har Mar Superstar. Contact him through edit@winesandvines.com.)

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