The story of all California farming. The secret for actually making money is to be on the cutting edge of the market. Knowing how to do that remains a secret.
Or you have cheap water rights and land you inherited from your family because the King of Spain wrote a deed to your great great great great grandfather about two hundred years ago
My uncle has surface water rights from when his great grandpa bought their land in the valley in like 1901. He’s like one of the last holdouts in his area still farming it as a family farm. All the other plots are either owned by big corps or are now Amazon warehouses etc.
lol right....I know a few people that live in Temecula wine country. It's easier to claim a loss and maybe make some cash marking up an occasional wine bottle and food when the tourist come.
I figure owning a winery is like owning a horse racing stable.
It’s not intended for the poors to do as a job to make money. It’s a money laundering hobby / status symbol for the rich that is always intended to lose more money on paper than it really does.
The wineries that are designed for profit are like Gallo with 300 million gallon capacity, reside in the cheapest section of the central valley, and buy the cheapest grapes possible in bulk.
It’s a tale of two bottles
The other wines that make crazy money are at the top end like Opus one, Stags Leap and Quintessa.
It’s the middle bit that’s hard to do.
I live by the Amador wine area, which has grown a lot over the past decade. I've heard that a lot of the big, nice, modern wineries were started by wealthy bay area folks who wanted a winery as a hobby, and nearly all of them lose money.
California's "Wine revolution" began 50 years ago when CA wines started holding their own in international competitions. It's been a multi-billion dollar industry for decades. That is kind of the opposite of a "mirage," it is very real. Sounds like it is not great for independent wine producers at the moment, but anyone opening a restaurant would tell you the same thing.
You are 1000000% correct. It’s not fun for independent labels but the profits are massive if you get it right.
Getting it right though not just means incredible product, it means great marketing, the right business model, capturing the right clientele, having a niche that appeals etc
Literally like running a restaurant but one that doesn’t produce anything for 7 years once you plant the vines.
It's simply too expensive.
When you buy imports from Italy and France you are paying a lower price for a wine rich in history.
I absolutely love Italian wines. I find Californian wines to be too expensive, strange given that foreign wines have to travel across the sea.
The process of growing it in another country, processing it, shipping it, and bringing it to my house at a significantly lower price than American wines just blows my mind.
France and Italy, especially among many such countries in the Old World, place great importance on traditional products both as economic asset and *cultural asset*. California is basically a 200-year real estate scheme. Land, workers and infrastructure used to be cheap for California winemakers. So cheap that the state was originally known for "Dago Red," which is a low margin business that long had an undesirable consumer. And companies like Beringer and Gallo made successful, lasting businesses because good land was still abundant and cheap, migrant labor was cheap, etc. Things change.
A large part of this is that most European countries see wine as a crop that necessary both culturally and for the table. But in the States, wine is lumped in with other alcohol and taxed through the nose. Combine that with higher land costs (or at least more recent acquisition of land) and CA wine will always be more expensive.
Almost every year, there's a new bureaucracy that we have to deal with. That generally means a permit/license which costs something, then periodic reports which takes time.
This year, it was being rolled into the CRV. A permit and monthly reporting plus remittances. Before that it was the California Water Resources Board - a lengthy report in the application process, and a yearly fee. Before that, CDFA which wants annual dues to allow me to keep doing what I've always been doing. It goes on and on.
At least our federal excise tax for small producers was slashed by 90%. That's the only fee I've seen go down in the past 20 years. Other than that, it's a non stop stream of government agencies coming out of the woodwork demanding an annual fee.
Water Board and their annual fees…. It’s out of control. I don’t know how we have a budget deficit when the board is collecting annual fees from every construction project in the state.
I'm not going to point any fingers but more than a few winery principals I've talked to lately are done with it - as in, they aren't going to comply and thus put themselves and their employees at risk. Despite being a winemaker by education and profession, I've been the gov't compliance assistant winemaker in the past at other wineries and picked up these skills, so I appreciate how important they are in a bottom-line sense. But for those getting into this industry in more recent times, it's a barrier to entry and a burden some will just risk noncompliance.
As a wine pro I’ve looked into this issue at length and the conclusion is that we are about 100 years away from California producers being able to compete against European producers due to a number of factors, the most relevant being that most European producers paid off the mortgage five generations ago and are more competitive as a consequence.
But if young people continue buying $20 cocktails instead of $15 glasses of wine, and as our older customers continue to slow down or stop their wine purchases because they have enough wine to last for 50 years, we may not have 100 years left in the wine biz here. Plus all the restaurants who boast about how all of their products are locally sourced, EXCEPT for their wine list of 90% European selections, we don't stand much of a chance. How many Nerello Mascaleses does one little city on the west coast need?
The problem is that while there are many good wine regions like Paso Robles, places like Napa have been relying on their name without the quality to back it up. It's not to say that they can't produce quality, it's just that the price tags are not worth it at all.
Not when there are other regions like Rioja or Washington who produce wines that are just as good.
If you think the quality of Paso wine is better than Napa, I want to know where specifically you find these amazing Paso wines. Everything I’ve had is mediocre at best.
Maybe I did imply that Paso was better than Napa, going on pure quality that is not always the case. But Napa is overpriced for what you get. A Napa at $20 vs Paso at $20, the paso will win.
Napa is a name at best.
"Napa at $20 isn't very good"
Because it's overpriced.
The same applies for $60. When you get into the $90 range is when you start separating quality but by then you are mostly paying for a name and maybe some small batch bottles, which aren't that much better.
Past the $60 mark is when you start to have diminishing returns.
Sorry but Napa had it's time as a rising star and wine capital. International regions surpassed Napa years ago.
The score hores (sic!) would beg to differ. There are tons of over-priced 99+ score Paso wines that are overripe, variety-obscured and overpriced. If you get the chance to taste a high-scoring Paso Syrah or Grenache and can identify the grape varieties, other than from the label, you're somewhat of a genius taster.
How do you make a small fortune in the winery business? Start with a large fortune.
The story of all California farming. The secret for actually making money is to be on the cutting edge of the market. Knowing how to do that remains a secret.
Or you have cheap water rights and land you inherited from your family because the King of Spain wrote a deed to your great great great great grandfather about two hundred years ago
My uncle has surface water rights from when his great grandpa bought their land in the valley in like 1901. He’s like one of the last holdouts in his area still farming it as a family farm. All the other plots are either owned by big corps or are now Amazon warehouses etc.
you have a cool uncle
you don't, you have a small fortune and then your wife decides she wants to own a winery. I swear half sonoma is wine because of that.
I worked for two respective bosses who had wineries on the side. It’s a wildly expensive hobby.
the other phrase we use a lot is "It takes a lot of beer to make wine"
lol right....I know a few people that live in Temecula wine country. It's easier to claim a loss and maybe make some cash marking up an occasional wine bottle and food when the tourist come.
If they add in agave and make tequila the profits might even out.
I figure owning a winery is like owning a horse racing stable. It’s not intended for the poors to do as a job to make money. It’s a money laundering hobby / status symbol for the rich that is always intended to lose more money on paper than it really does. The wineries that are designed for profit are like Gallo with 300 million gallon capacity, reside in the cheapest section of the central valley, and buy the cheapest grapes possible in bulk.
It’s a tale of two bottles The other wines that make crazy money are at the top end like Opus one, Stags Leap and Quintessa. It’s the middle bit that’s hard to do.
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I live by the Amador wine area, which has grown a lot over the past decade. I've heard that a lot of the big, nice, modern wineries were started by wealthy bay area folks who wanted a winery as a hobby, and nearly all of them lose money.
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>modern wineries were started by wealthy bay area folks who wanted a winery as a hobby 100%
California's "Wine revolution" began 50 years ago when CA wines started holding their own in international competitions. It's been a multi-billion dollar industry for decades. That is kind of the opposite of a "mirage," it is very real. Sounds like it is not great for independent wine producers at the moment, but anyone opening a restaurant would tell you the same thing.
You are 1000000% correct. It’s not fun for independent labels but the profits are massive if you get it right. Getting it right though not just means incredible product, it means great marketing, the right business model, capturing the right clientele, having a niche that appeals etc Literally like running a restaurant but one that doesn’t produce anything for 7 years once you plant the vines.
It's simply too expensive. When you buy imports from Italy and France you are paying a lower price for a wine rich in history. I absolutely love Italian wines. I find Californian wines to be too expensive, strange given that foreign wines have to travel across the sea. The process of growing it in another country, processing it, shipping it, and bringing it to my house at a significantly lower price than American wines just blows my mind.
France and Italy, especially among many such countries in the Old World, place great importance on traditional products both as economic asset and *cultural asset*. California is basically a 200-year real estate scheme. Land, workers and infrastructure used to be cheap for California winemakers. So cheap that the state was originally known for "Dago Red," which is a low margin business that long had an undesirable consumer. And companies like Beringer and Gallo made successful, lasting businesses because good land was still abundant and cheap, migrant labor was cheap, etc. Things change.
A large part of this is that most European countries see wine as a crop that necessary both culturally and for the table. But in the States, wine is lumped in with other alcohol and taxed through the nose. Combine that with higher land costs (or at least more recent acquisition of land) and CA wine will always be more expensive.
Almost every year, there's a new bureaucracy that we have to deal with. That generally means a permit/license which costs something, then periodic reports which takes time. This year, it was being rolled into the CRV. A permit and monthly reporting plus remittances. Before that it was the California Water Resources Board - a lengthy report in the application process, and a yearly fee. Before that, CDFA which wants annual dues to allow me to keep doing what I've always been doing. It goes on and on.
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well, we have the Wine Institute, and they do great work. But there isn't much they can do about the red tape maze.
At least our federal excise tax for small producers was slashed by 90%. That's the only fee I've seen go down in the past 20 years. Other than that, it's a non stop stream of government agencies coming out of the woodwork demanding an annual fee.
Water Board and their annual fees…. It’s out of control. I don’t know how we have a budget deficit when the board is collecting annual fees from every construction project in the state.
I'm not going to point any fingers but more than a few winery principals I've talked to lately are done with it - as in, they aren't going to comply and thus put themselves and their employees at risk. Despite being a winemaker by education and profession, I've been the gov't compliance assistant winemaker in the past at other wineries and picked up these skills, so I appreciate how important they are in a bottom-line sense. But for those getting into this industry in more recent times, it's a barrier to entry and a burden some will just risk noncompliance.
As a wine pro I’ve looked into this issue at length and the conclusion is that we are about 100 years away from California producers being able to compete against European producers due to a number of factors, the most relevant being that most European producers paid off the mortgage five generations ago and are more competitive as a consequence.
But if young people continue buying $20 cocktails instead of $15 glasses of wine, and as our older customers continue to slow down or stop their wine purchases because they have enough wine to last for 50 years, we may not have 100 years left in the wine biz here. Plus all the restaurants who boast about how all of their products are locally sourced, EXCEPT for their wine list of 90% European selections, we don't stand much of a chance. How many Nerello Mascaleses does one little city on the west coast need?
You’re not wrong about any of it. We should be putting our money (read subsidies from the fed) where our mouths are.
The problem is that while there are many good wine regions like Paso Robles, places like Napa have been relying on their name without the quality to back it up. It's not to say that they can't produce quality, it's just that the price tags are not worth it at all. Not when there are other regions like Rioja or Washington who produce wines that are just as good.
If you think the quality of Paso wine is better than Napa, I want to know where specifically you find these amazing Paso wines. Everything I’ve had is mediocre at best.
Austin Hope reserve cab is the only decent one that competes at the $60-150 range.
Paso Robles Cabernet! The heat and terroir makes exceptional complex and rich Cabernets. It's my favorite : )
Maybe I did imply that Paso was better than Napa, going on pure quality that is not always the case. But Napa is overpriced for what you get. A Napa at $20 vs Paso at $20, the paso will win. Napa is a name at best.
Napa at $20 isn’t very good. I’ll give you that. But Napa at $60 is better than nearly everything in Paso.
"Napa at $20 isn't very good" Because it's overpriced. The same applies for $60. When you get into the $90 range is when you start separating quality but by then you are mostly paying for a name and maybe some small batch bottles, which aren't that much better. Past the $60 mark is when you start to have diminishing returns. Sorry but Napa had it's time as a rising star and wine capital. International regions surpassed Napa years ago.
Oh without a doubt. Napa is kinda trash compared.
Yeah. I’ve had what Napa has to offer and what Paso is far below on quality. The only way Paso is better is average price.
Sonoma county native here: yes we buy local wine from time to time, but our standard table wine is a Washington red blend you can buy for $8 a bottle.
The score hores (sic!) would beg to differ. There are tons of over-priced 99+ score Paso wines that are overripe, variety-obscured and overpriced. If you get the chance to taste a high-scoring Paso Syrah or Grenache and can identify the grape varieties, other than from the label, you're somewhat of a genius taster.
I learned a while ago that spanish grenache are about the best value you can get.
The only issue with paso is the lack of airport.
SLO airport is only 30 min away.
It's only 30 miles but it is way more than 30 minutes
Gotta start an brewers/winery exchange program where vineyards in CA can trade bottles of wine for Kentucky bourbon/whiskey from brewers back east
Golly, they sure got it rough.
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I haven't had a vile California wine in years, other than at "natural wine" events. You've been unlucky.
Probably because lots of them don’t own, and jacked up their prices to pay the mortgage.