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p r a c t i c a l w i n e r y & v i n e ya r d M ay 2 0 1 4 83 ever, the latter has been Mount Eden's bread and butter for some time. Case pro- duction reached 5,000 in 2013, up from 4,000 in the early 1990s. Wolff, with its own label design, sells for $21 at retail. "The wine is very solid, and at that price cannot be beat," notes Ellie. No tasting room required Mount Eden Vineyards continues to maintain a positive cash flow due to the Patterson's unwavering approach not just to making balanced wines, but to following a well-developed business model that had already been in place when they first arrived. "Jeffrey and Ellie came to Mount Eden at a good time and have stayed true to what they are doing," says Kaster. "They have been focused, and because of this consumers know that they will enjoy quality wines every year." The business model is simple: Promote the brand by having the wines on the "shelf." The Pattersons do not have a tasting room and thus have no related overhead costs. "Our philosophy is that quality wineries do not need tasting rooms," explains Ellie Patterson, who does admit, however, to trying the con- cept once at the insistence of the former majority shareholder. From 2008 to 2011, the Pattersons were among eight wineries that poured wine at the Press Club in San Francisco, but the program was unsuccessful. "The Press Club thought that people would want to taste wine in downtown San Francisco and talk to a winery rep, but that really was not the case," Ellie Patterson recalls. "Tasting rooms — and wine clubs — are good to have if the wine cannot be found, but we are well-distributed." The wines are sold in 37 states out- side of California and in eight interna- t i o n a l m a r k e t s t h r o u g h s m a l l e r, three-tier distributors. "We like having a little bit of wine in a lot of markets rather than a lot of wine in fewer mar- kets," Ellie Patterson notes, an approach that helps increase exposure. Allocations are done for all markets — California, out-of-state and export. Each sales rep in California receives his/her own allocation number for both Estate and Domaine Eden wines. All distributors receive an allocation number at the beginning of the release, and that number is tracked carefully. In general, estate wines are restricted to up to three cases per account and are sold to fine-wine shops and restaurants, since they are made to age. Domaine Eden Chardonnay and Wolff Chardonnay are offered by-the-glass and are not allocated to sales reps; only a total for the state. The percentage of wholesale revenues in 2012 was 54% (out-of-state) and 33% (within California). "We like people to sup- port their stores and restaurants," explains Ellie Patterson . "I prefer that when you go to New York (for example), you can find our wine in many of the best restaurants. The wines do well back east because of that market's affinity for French wines." Export sales were 7%, including sales in Japan, Taiwan, Germany, Norway, Den- mark, Hong Kong and the Philippines. Retail (website and wine club) reve- nues are just a fraction of overall sales and were 6% in 2012. Many small wineries like Mount Eden Vineyards have a mix of distribution and direct-to-consumer channels. Focusing mainly on distribution can be challeng- ing due to the consolidation of distribu- tors, notes Aguilar. "However, in Mount Eden's case, distribution works because the winery has a quality brand that has proven reliable for more than 30 years and, thus, has strong support from both consumers and distributors." w i n e B U S i n e S S