Issue link: http://winesandvines.uberflip.com/i/766392
January 2017 WINES&VINES 155 PRACTICAL WINERY & VINEYARD BUSINESS guys. They will serve as the kind of pe- riphery, but still the big guys are going to knock out any smaller distributors." " Without a doubt there is going to be a more robust smaller tier distribution sys- tem that will become stronger and more robust over time." " I bet there are more distributors than 10 years ago. There are just more small ones. Will they survive? They will continue to be swallowed up by the big guys as they be- come viable. A lot of small distributors will want exit strategies. The reason we buy brands like we do is because they come with a new distributor network. We try to take advantage of multiple distributors in multiple states. We try to pick the right dis- tributor for the right brand in our portfolio." " Over the next 10 years we will see a few more distributors pop up because the very large ones out there cannot possibly do jus- tice to all the brands out there. I think new ones that are well financed and understand the business can find their own niche." " We are not going to have a new major ar- rival on the scene. There will be smaller, more nimble companies that arrive, de- pending on what accounts they need to cover. Are you trying to do on-premise, off- premise, high-end, medium-price, lower price? If you need a full-service distributor, you will have to deal with the ones that exist right now." " In many areas, most markets are going to end up with two major wholesalers and one medium wholesaler that is focused more on smaller wineries and smaller craft distilleries. There is not going to be a sig- nificant number of small distributors be- cause the economics do not make sense if you are too small." " We see that today. There are quite a few boutique distributors. The challenge is coverage. The big distributors have an ad- vantage with a large sales force that calls on restaurants and retailers almost every day. Boutique must pick the cream, the very best accounts they can. They are very different models." " Smaller wineries are not really thinking about distributors and are going direct sale and making that their format to grow through their tasting rooms and wine clubs. Growth is smaller and not as quick, but it is more profitable." Q There is data showing the millennial generation drinking more and higher quality wine. Do you think this is true, and, if so, why? " Because they are the babies of the baby boomers. It is a cultural shift in America led by the baby boomers. More accep- tance toward alcoholic beverages overall. Less puritanism going on and per- haps easier accessibility. Generally more fluency and exposure to it. Less stigmatism." " Nobody wants to do exactly what their parents did. Most people are introduced to wine around the dinner table. People like to keep changing from their parents. If you grew up in the 1950s and 1960s, they drank scotch and sodas or gin and tonics. If you grew up in the 1970s and 1980s, they drank more traditional wines. Millenni- als are drinking new stuff. They want to go out into the world of wine and not just (drink) Bordeaux or Napa Cabernet. They want to go out and try new wines." Anderson Valley Winegrowers Association Presents 12th Annual International Alsace Varietals Festival Taste aromatic white wines from around the world February 25 — 26 2017 Anderson Valley California For tickets & more information visit www.avwines.com Thank you to our sponsors: Kiyasa Group-Lehmann Glass, D. Scott Farmer & Mia Ballentine, American Ag Credit, Wine & Spirits, Wines & Vines, G3 Enterprises/DIAM Closures, Bright Event Rentals, Visit Mendocino County, Mendocino Winegrowers, Inc., Encore Glass, The Nature Conservancy, PCC, Big River Coffee, Costeaux French Bakery, Mountain Fresh Water. Providing leading wine makers with stainless steel barrels of high quality, durability, and design. phone: 773.735.0700 • toll free: 800.441.8780 www.skolnikwine.com • email: sales@skolnik.com