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Does Following Your Wine Passion Equal Crazy?

There is a cottage industry of people writing self-help books and giving trade show speeches about following your passion.  “If you love what you do, you’ll never work a day in your life,” goes the mantra.  But, if you’re a wine enthusiast is following your passion crazy talk?

In fact, there’s a perfectly easy way to enjoy the fruit of the vine and it doesn’t require masochistic tendencies … it’s mostly at the kitchen table with a glass … as a consumer after work from a day job that presumably pays you commensurate with your capabilities.  It’s a lot easier that way, surely.

Yet, the notion of jumping into the wine business has been top of mind lately … I’ve been thinking about it because there are precious few wine enthusiasts who are passionate enough to write online or engage in leading social media activity who don’t have a desire to make their way into the wine business either as a member of the media, on the production side, in marketing, or in the supply-chain.

That’s a lot of people ready to pounce on an opportunity if it presented itself.

Some have acted on it; others are attempting to act on it.  I’ve already made a sojourn in and out of the business and I still think about it.  It’s the genteel nature, the collegial spirit, the rhythm of the seasons.  It’s the unfolding drama of watching something grow from nothing in between bud break and harvest and then turn into something magical during the winter quiet, the end result fostering conviviality and joy.

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However, despite the mind’s eye mental picture of idyll, the question about going into the wine business has to be asked:  Why invite the agony?

It’s not like it’s easy.  In fact, I know it’s hard—harder and less lucrative than the industry and job that most people are coming from.

I’ve been reading the stories about the difficult sales environment that persists for most small vintners.

I’ve been reading the stories and watching acquaintances with marketing chops hang their own shingle.

I’ve been reading the stories about the weather in California and the stress of whether grapes will ripen, Mother Nature’s sub-plot this year.

Privately, I’ve been talking with a Mendocino vineyard owner who has 120 tons of very good fruit ripening at this moment.  Its 120 tons that’s separate from what goes into his own luxury wine from the same vineyard—and he can’t find a buyer this year after contracts weren’t renewed.

Production in California is “rightsizing,” as they say.

Here’s the math he gave me:

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A ton of Chardonnay costs about $1300 to grow and get to market.  If he’s lucky, on a contract, he can sell it for $1100 a ton – it’s a paper loss, but a loss that can be rationalized as profitable against hard costs, but certainly not good business by any standard; it’s not “get ahead” living, more “get by” living.

However, if he makes wine from the tonnage, that creates another set of circumstances that has to be dealt with—there isn’t a market for expanded volume with his luxury label so he has to look at a second label.  One ton of grapes will yield about 60 cases.  So, our grower/vintner has a potential 7200 cases on his hands.  This grower can produce an exceptionally high quality wine from these grapes, but would have to forsake oak barrels for oak by-products.  Why oak at all you ask?  Because the price point and style of wine that’s selling right now requires it.

If he has $4 in costs per bottle and he sells the wine for $8 a bottle wholesale so the wine can go on the shelf at $12 a bottle he has a chance to earn a nice return on the grapes.

But, here’s the rub.  The second label hasn’t been created yet and creating a brand takes time and money.  Nor is there a sales channel for this to-be-created wine, either.

This marketing and sales activity is outside of his manpower and capabilities, so he would have to get outside assistance – branding, web development, marketing, sales activity.  Those are all costs with uncertain returns.

Of course, forget about bank financing because that has become exceedingly difficult to earn, especially for efforts that can’t be associated with hard assets like land or buildings.

It all adds up to this – take a total loss on the grapes by not doing anything with them OR take a huge financial risk by making wine that doesn’t have a brand and doesn’t have a sales destination.

These sorts of stories aren’t isolated to one person, or one segment of the wine business.  Every aspect of the wine business supply-chain has a similar tale of woe where getting ahead of “getting by” meets consequential risk.

Yet, undaunted, the allure of the wine business holds steadfast for most.

Getting into the wine business?  Crazy talk?  Not unless you have an iron stomach, a penchant for hardship, a love for “poker chips in the middle of the table” risk and an opportunity for success that that gives the house a material edge.

Me? I just might simply open a bottle after a hard day’s work of doing something else, passion notwithstanding.



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Posted in, Good Grape Daily: Pomace & Lees. Permalink | Comments (13) |


Comments

On 08/13, Christopher Cribb wrote:

Great piece, I often wonder about the same thing as people come up to me and say “Wow, I wish I had your job!” 

As an entrepreneur running a small import company I run into similar scenarios daily, with the added wrinkle/costs of importing goods.  One of my favorite quotes in this business… “It is easy to be a millionaire in the wine business… start off with two million.” smile

I have read a few books about following your passion, most don’t emphasize the facts that the road less traveled is bound to be bumpy along the ride!

Cheers!

~C.Cribb

On 08/14, Thomas Pellechia wrote:

Without specifically plugging one of my books on the issue, the complications and reality of the wine business is what the whole book tries to convey by example.

This is one of those areas in life where I can say from experience that, “I wish I had known these things before I spent my money on it!”

The passion behind wine is challenged on the day you apply for your state license from the Alcohol Control people—from there, it’s all hard work that tugs at your passion.

On 08/15, Jeff wrote:

Thomas,

You must be referring to your book, The Complete Idiot’s Guide to Starting and Running a Winery. 

You shouldn’t be so deferring and gracious.  It is well-reviewed on Amazon.com, including one reviewer who says (very much in line with your comment):

“At first, i thought the book was too negative, and actually discouraging to winery-ownership aspirations(“You can make a small fortune in the wine business, provided you begin with a large one.” HA HA). But as I read other books, I realized the author’s purpose: There were just too many people gettin’ into the “wine biz” for purely romantic reasons, without an ounce of outdoor/ag/technical/marketing knowledge. It’s not hard to “love” wine; many people do. Neither is it hard to love fast cars, but I wouldn’t think of operating a sports car dealership. And yes, from first-hand experience, it is VERY expensive to start up a winery. For anyone considering getting into the winery business, this book is worth buying”

For comment viewers interested in the book, you can find it at the below link:

http://amzn.to/chnIIy

On 08/15, .(JavaScript must be enabled to view this email address) wrote:

Jeff,

” Why invite the agony indeed “, indeed!  Doing what you love so that you wont have to feel like you’re working for the man is noble, but It’s seldom a recipe for financial security.  The road is littered with aspiring artist, musicians and entrepreneurs who knew little or nothings about the fields they threw their hearts, souls and wallets into.  I agree with you.  We just simply open up a bottle after a hard days work and leave that passion thing to others.

On 08/16, Erika Szymanski wrote:

Time for the Devil’s little advocate to stick her fingers in the pot. What does following your passion mean when it comes to wine? Does it mean that you have to try to make it or try to sell it? There are so many ways to be involved “in the industry,” and you’ve already found and followed one of them: wine blogging! Passions don’t have to be full-time careers to be “followed,” do they?

On 08/16, Alan Baker wrote:

Nice piece Jeff. And Thomas, I have your book and don’t at all think it’s a negative spin. I congratulate you on putting it together and for showing some of the realities of making a wine venture a success.

For me following my passion to make great wine was something I was driven to do, it wasn’t about pursuing a romantic vision. It might look that way to those who have watched the journey and yes when writing about the experience it’s always more fun to write about the wonderful experiences, rather than the late nights worrying about early rains or how the two of us can make enough calls, or pour enough wine, to build the brand. It definitely wasn’t a decision made to make money but I will say that working night and day to build something that is ours is better than working night and day just for a paycheck.

Time will tell if it will work but I’m happy to be trying. At this point I can’t imagine being away from the vineyards. It took a few years to shed some of the worry but as the excitement, and chaos, of harvest starts to build, I can tell I’m in the right place.

Alan Baker
Cartograph wines

On 08/16, Kristy Charles wrote:

I tell people wanting to leap into being a vineyard owner and winemaker a few things: that they’ll likely never make as much money as they could in another field, nor will they have a nice, cushy retirement at a reasonable age. Instead, they’ll work their butt off every day of their life with little monetary gain to show for it.

However, every day is casual Friday and perfectly appropriate for blue jeans and a t-shirt. You can arrange your own schedule, hire and fire who you want (if you’re lucky enough to have employees), try new and different things every day, and generally have freedom you never dreamed of while sitting at your cubicle.

Most importantly, you’ll live a lifestyle rich with amazing food, great wine, and lots of like-minded “crazies.” You’ll work VERY hard, but you’ll play equally as hard, and that lifestyle factor, after all, is the allure of the wine business.

On 08/16, Jeff wrote:

Thanks for the comments, everyone.  I appreciate it.  First time commenter’s, please don’t be strangers.

Generally speaking, the point I was trying to convey is that the wine business is damn hard.  Subtly, I have incredible respect for people that come in and earn success because I know how difficult it can be.

Regardless of how you participate in wine, the respect goes to the people that make financial risks to follow their dreams.

Jeff

On 08/16, Marco Montez wrote:

Great post Jeff, once again.
I launched my small winery two years ago. I knew it was going to be difficult, still… I have been surprised by a few aspects of the winery ownership business. The sort of things that make me wonder if I made a mistake. Some nights it’s even hard to sleep and I get out of bed ready to give it up. That same day, something will happen and before I know it, I’m afraid that I won’t have enough wine to meet demand.  Launching my winery has been the most difficult project of my life…. at the same time it has been by far the most rewarding.

On 08/18, winka wrote:

Im not good in english, but this article is quite well.

On 08/19, Emily wrote:

I’m not sure I agree with Kristy on “if you’re lucky enough to have employees.”

Something to ponder at the kitchen table with that glass of wine:

If you’re thinking about starting a business—ANY business—then you are one of the people who are blessed (cursed?) with the ability to imagine things better than they are; i.e., a better role for you, bringing your fascinating wine to market.  Or a better way to express a particular vineyard region. 

WARNING:  You may assume that “employees” (or high-priced marketing and winemaking consultants) will also think that way, that they will try to optimize opportunity for your brand and look out for the hand that feeds them… Or you may think the wine community—the folks that have been here two years longer than you—will appreciate you joining them…

You may even go so far as to assume that a grower who desperately needs a buyer for his grapes will appreciate your offer to purchase them for the same price as the peak of the market…

You will be surprised.

On 08/28, Ed Thralls wrote:

Good post, Jeff as always.  Sorry so late to the party but want to jump in as I am one of those “chasing the dream” at the moment.  The phrase about the grass being greener can apply to anyone changing industries, jobs, cities, whatever.  The challenges and risks mentioned aren’t issues only for the wine industry… they are everywhere.  Do you think it’s easy to work with top tier global financial institutions developing software so they can manage billions of dollars in an ever-changing regulatory environment, not to mention recession?  That’s what I used to do until laid off 2 months ago and it was hard work, stressful, etc… all those things mentioned already.

Well, those things apply everywhere.  I do not have dilusions of grandeur that working in wine will be sitting around and drinking wine all day.  I don’t mind working and working hard - just let the job be interesting and fun.  The idea is that I have another goal in life and the only goal worth targeting is something that will challenge you.  If you sit idley by in a seemingly financially secure job (is thre such a thing these days?) but not reaching for the next thing in your life, you are not really living… only dying.

Jeff, during our recent conversations I have really appreciated your support in this new venture of mine and I’ll keep you updated on my progress.  I know it won’t be easy.  Sometimes, it’s more about the journey and less about the destination (sound familiar?)

Cheers!

Ed

On 01/17, Atlanta DUI Lawyer wrote:

You’d have to market your wine to a few restaurants. Make the wine to suit them and put their label on it. I think making wine should be a hobby at first. If it becomes lucrative then that’s just gravy.


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