Sunday, February 13, 2011

Sagelands - the End of the Story

Put a fork in it, it's done. Friday, the new owners of Sagelands and Canoe Ridge called the winemaking staff together and told them to pack. As Arnold said, "You're terminated." All of the bulk wine will go to Precept Brands. There are no plans to reopen what was once the most successful tasting room in the state.

According to Yakima County records, the property still belongs to DIAGE   DIAGEO CHATEAU & ESTATE WINES and the land and building are valued at $860,250. I think this property is listed for sale, but I have been unable to verify the listing.

While I am at it, add another one to the list. An unnamed Benton County winery with vineyards in the Horse Heaven Hills is for sale for $1.5 million. Their annual sales are 5000 cases (sound familiar?) and their bulk inventory is over 16,000 cases dating from 2007. Judging from bulk wines offered in the Wine Country Classified, I would guess they have a leased tasting room in Prosser - not far from Olsen Estates. Their wines range in price from $26 to $38 per bottle. At $30 per bottle, their inventory is worth about a $5.76 million. It sounds like another case of easy money in the wine biz. But wait, that's not all. They have accolades "from Robert Parker, Wine Spectator and regional ratings, awards and accolades." Don't we all.

Following other bloggers - especially ones who secretly read this blog (More on this guy later.) - no one realizes the problems facing the Washington Wine industry - least of all the Washington Wine Commission. Yes, there are three new wineries in Zillah. If I were looking for tasting room sales, I would say these wineries are ideally situated. Getting distribution is another matter. Getting accolades, that's easy; just give away a lot of free wine plus shipping.

I'll say it again. The Easter Bunny isn't real and the goose that laid golden eggs is dead. The glory days of the wine industry are over. The American wine drinker has matured. He/she no longer needs Bobby Parker and the likes to tell them what is overpriced, unavailable and good to drink. Well-crafted wines under $20 sold through the tasting room have a chance if you are in real wine country with real vineyards around your tasting room. Don't make 40,000 gallons and hope distributors in 9 states can sell it for $30 per bottle just because Bobby Parker said it was good. If you are entering the wine business, you better have a solid business plan and know how to keep costs low - especially grape costs. Growth to 1000 cases is probably reasonable, but beyond that, you need to take market share away from someone else and that someone else might just have Napa Valley on the label. Remember, I can buy $35 cabs from the Napa Valley for $12 at Grocery Outlet.

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