Drops 'n Dregs
This site is now closed
and has been left here
for historical reference
only.
Sydney Time
Copyright © Ric Einstein 2009
As the name suggests, this section
is devoted to bits of information, comments and readers feedback that don't warrant a complete story on
their own. It will up updated whenever the need takes place.
Feedback to:
Loads of very short email about this topic with one common thread in all of them in relation to the Lindemans Global Brand Director Oliver Horn comment, "The research also revealed that the Lindemans brand was seen as a truly international brand – not Australian-specific – by consumers in the European and North American markets."
As an ex senior corporate marketing person myself, I know full well that surveys and research can prove any point the originator desires by framing the questions is a certain way. If the Lindemans Brand Director actually believes this statement, he is as deluded as the corporate hierarchy that accepted the statement and was insane enough to include it in a major announcement. The consensus of the feedback from readers is that it completely lacks credibility and makes the company look like they don't know what they are doing.
Kevin Beck, an experienced US retailer had more to say on the subject.
"I hope Foster's isn't silly enough to believe Lindeman's is a GLOBAL brand! As
a wine retailer, I have noticed in my market that Lindeman's is almost
considered a joke as far as quality is concerned. They market ONE product that
can be relied upon for consistent sales, but do not even have a foothold for
most of their products. I am willing to surrender more of their shelf space over
the next few months as other quality product becomes available from the
Australian mainland. And I see no reason for even bringing their other imports
into my store. As for Rosemount: This is a brand that used to account for over
40% of my Australian sales less than five years ago; now, I would be surprised
if this represents as much as 4%. Wow! How times change!
Feedback to:
Regular correspondent Bruce Routley had good feedback on this article.
"I just had to comment on your story about "Whats it all mean", and I could not
agree more. I probably get some of the the same weekly email specials as you do,
and some of them make the mind boggle. We know what stuff is worth, so can work
our way through all the bullshit fairly easily, but I still get stung paying too
much for wines.
It happened recently, with a well known etailer, and when I sent an email to
have a whinge, guess what, no reply. They keep on advertising the same fantastic
prices, which are not that fantastic at all. I suppose if people don't do their
homework, and pay too much, its their fault. But when regular buyers like me get
done, I think about the average wine buyer, and how easily they can get done.
Recently a winery was kind enough to send me samples of three of their wines
to review. The email exchange between myself and the winery tells the story.
"Hi Xyz, Thank you for sending the samples of your 2003 wines. Unfortunately the
news is not good and I need to get your opinion and possible further information
from you before I do anything with my tasting notes.
Three bottles and three dodgy corks! I was wondering what sort of response I
would get; shock, surprise or denial? Here is what it said.
"Hi Ric, Over twelve months ago we made a decision to abandon natural cork and
the closure we chose was the 47ml Sabate Diem. This is a TCA treated composite
cork, it is totally in round, it has no seams or capillaries and it satisfies
the premium end of the restaurant market here. Further to this we have spent a
considerable amount on a new corking machine so we will never have a cork
related issue again. I must say that I am very pleased with the result of this
move.
TORB's Comment: What a great honest response and it is for that reason I
will not name this small winery. There was no prevarication, denial or ducking
the issue. They have recognised it and have taken action to stop it happening
again. Some wineries (normally the mid to large players) test every batch
of corks and I have long wondered where the batches that were rejected ended up.
No wonder so many wineries are giving natural cork the flick and converting to
alternatives.
Feedback to
Damned if You Do - Screwed if You Don't
(23August)
This one generated lots of comments and questions. The first one came from
Sarah Walton who said:
Thanks for the article 'Damned if you do, Screwed if you don't" - It helps quite
a bit. I tried the 2004 Rosabrook Chardonnay late last year, and loved it, and
had been recommending it. Tried a bottle last night, and it has developed quite
a woof, and it had me baffled, as I found the wine very clean upon first trial.
I take it now, that the wine is "screwed", and we can expect no further change
for the good? What happens chemically after the process 'peaks' at about 18
months?
I hope the @#*$^@ at Foster's realize where they are taking the great companies
they digested these previous two years, and recognize that they are creating
more disasters for the next few years. At this time, I am very pleased to have a
great relationship with my primary Australian (and Southern Hemisphere) wine
suppliers, and will help my customers dicover that the Southern Hemisphere has
quality beyond just quantity."
Only last week one of these etailers offered a wine, that was at a genuine half
price, and I rang them 25 minutes after I got the email, to order. The website
said 500 dozen available, and guess what, they were all sold out. 500 dozen
wines sold in 25 minutes. Huh! I wish I had a business that could sell 500 dozen
of one wine in 25 minutes. Of course, I was offered a lesser vintage, which I
declined.
Another story, just last week, and expensive wine won a big tasting, and I
wanted some. The winery sent me an email bragging about the win and stating that
there was a little bit left, so I ordered a six pack. Three days later a well
know wine store had the same wine on special, at a price 20% lower than I just
paid. And this was an expensive wine.
Competition is good. But I have found its best not to order from the first
company that contacts you with a just released wine. Retailers this week are
flogging the 2005 Amon Ra. The prices I have been offered are.........$88,
$80, $78, $72, $71
and on the Godolphin $53, $50, $49, $47 and $43 and that's
just in 3 days. About 20% difference from dearest to cheapest.
The Cabernet Sauvignon wasn't at all bad; in fact it was a good result for the
vintage. However what concerned me about this wine when I opened it was the
condition of the cork. The cork looks like it had not sprung back properly
and there was staining on about 80 percent of the cork, right up to the top and
it looked like some drops had actually leaked through, staining the top
of the cork.
I then opened the Shiraz and it was also suffering from slight leakage,
but unfortunately the bottle was absolutely rank with cork taint; the
sort of level where even inexperienced wine drinkers would think there was a
problem with the wine.
I then opened up the Merlot. This cork also showed signs of leakage; the
bottom half of the cork was almost completely wet and it had leaked through to
the top on one side. It also looked like it had not sprung back as far as it
should have, but it was not as bad as the Cabernet cork. Unfortunately this wine
was not sound either. The aroma was rank and despite vicious swirling it
had not blown off after a couple of hours. I left the bottle for 24 hours by
which time the stench had dissipated and whilst there was a pretty good level of
fruit flavour, I doubt the bottle was sound. I'm not sure if it was TCA or some
other fault, but it was not a good look.
I look forward to hearing your comments."
Prior to the 2004 vintage we had been paying top dollar for Reference 1 corks
and clearly not getting them. The quality has been more likely Ref 2 or worse.
Of course this was happening at a time when there was enormous demand for cork
and the cork industry was satisfying the demand with inferior product which it
pushed out to smaller wineries like ourselves. Not surprisingly these wineries
got pissed off and made choices on other closures. There is no doubt that if
I compare the level of cork taint we are getting today with the cork taint we
were getting in say vintage 2001 or 2002, cork taint today is more frequent.
However there are two issues here and it is my belief that neither are related.
The first is cork taint. The second is wine seeping down the sides of the cork.
It is our experience and I suppose we are opening about 2 dozen bottles per
week, that most of the corks which have seeped have not seeped the full way,
have not leaked externally and the bottles have not displayed ullage of any
kind. Whilst I agree this is not a great look we have found the wine to be
completely unspoiled and sound. The bottles which have taint would have had
taint anyway. We have not found a bottle which has leaked externally or where
the wine has become oxidised. We have also not had a complaint from anyone else
to date. It would appear to us that in the bad cases where wine has seeped a
lot, the particular corks in question appear softer and more spongy than the
better corks or have had wine running down a fault line in the cork. It is also
my belief that not every cork is like this."
To ensure I got the right answer, I asked Alan Limmer who emailed back this response. "The kinetics of what happens after the peaking of the sulfide bite (I assume this is the woof), are determined by the oxygen ingress rate and SO2. As the SO2 declines over time, so the rate of disulfide reduction will too. This in turn, means the rate of thiol production will also decline. But the oxygen ingress rate remains constant. Eventually, the rate of thiol production will decrease to match that of the oxygen ingress, and slowly the sulfide notes will dissipate. Long aged wines under screw cap do not usually show this sulfide note. This is why understanding the SO2 mechanism as a causal factor is so important. It explains why, under cork, if we do see any of these notes, they are more transient, that's because the SO2 drops quicker under cork, and the O2 ingress is an order of magnitude or so more than screw cap. So, the character dissipates so much quicker, if it ever appears. The downside is the wine under cork will show oxidative notes earlier .
By chance, Adair Durie then asked a question which turned out to be a great follow up to the above comments.
The reductive characters in screw-capped wines – I better now go put all my
faith in DIAM now! Seriously though, I wonder if aerating/decanting/letting sit
a reductive screw-capped wine would do the trick for most cases… although, after
4 or 5 days of being opened, there was no change in the sulphur fault of a
screw-capped 2004 Austin’s of Barrabool Riesling I had at home recently, which
was finally poured on my BBQ as a cleaning agent.
Although I thought I knew the answer to this one,
once
again I asked Alan for his thoughts.
"Decanting stinky wine is interesting. In my experience
this character is still in the wine the next day, but over a few days does
dissipate. So, I doubt decanting is going to do much. Decanting is likely to
remove some H2S - it is the most volatile sulfide in wine. But H2S is not formed
by this mechanism. If there is any H2S in the wine, it was left there at
bottling.
What does remove this character is a coin in the glass. Traditionally copper,
but in fact these sulfides react strongly with any metals. So, to see the
difference, you can try a coin in the wine for five minutes or so, and compare
the two. The one with the coin should have a cleaner fresher palate. This is a
slightly imprecise method to approach the problem, but it does work. I have seen
plenty of wine makers do it."
Hal Seow was next.
I initially thought that this issue was one of those "Spagetti grows on trees", an April Fools -"come in spinner"- joke, but wow it hits like a sledgehammer. Here I am fully besotted with buying all my wines with Stelvin seals to avoid the experienced cork adversities and now along comes this! What to do.??
Alan Limmer seems to have closed any door of escape in when he says even wines
bottled clean of sulphides (supposedly), all wines will contain disulphides and
thioacetates which can/will degrade over a relatively short period of time i.e.
months to produce particularly smelly sulphides aka THIOLS, and supports this
with evidence from AWRI closure trials and anaerobic experiments. This raises
many queries; some of these are-:
Firstly, are all type of wines so affected ? i.e. white, red ,sparkling,
fortified or does the quantity of alcohol, co2gas, and other preservatives
mitigate. Many bottles of port for instance sealed with wax do not display
obnoxious sulphide notes nor am I aware that sparkling wine (particularly
sparkling burgundy type sealed with crown seals initially) have any sulphide
notes. Is there a magic formulae? Is it coincidental that there have been many
wines produced and sealed under screw caps that show no detraction from
developed Thiols? Your tasting notes in the last newsletter on O'Leary Walker"s
2002 Reserve Shiraz (under stelvin) did not appear to suffer any
reductive/sulphide characters as you rated it Excellent ,so is it hit and miss.
Will you be more guarded in making recommendations in the future re wines under
stelvin than usual or will you be more searching for traces of sulphides in
wines than otherwise. Will these comments by Alan Limmer ignite the cork lobby
into escalated banter. And who will pick up the tab when a consumer complains
that a particular wine is unacceptable because of it's Thiols pong? The wine
producer or the Screw Cap maker for producing an item that under Mercantile law
is not fit for the purpose.???"
I should imagine that many comments will be provoked by this matter and you will
have some reading to digest so could you simply advise how I can avoid
avoid the adversities of Thiols pong in my future wine purchases.
Unfortunately all wine is potentially subject to the problem. Unfortunately just
like cork taint, it is a crap shoot. The AWRI trials showed the problem with
white wine initially. In terms of sparkling wine (especially red); when they are
under crown seal, most of the good stuff is on lees for some time. As the
reductive stink normally peaks around 18 months after bottling, it is quite
probable the smell is already dissipating but the time the wine is disgorged,
and then sealed with a cork. The disgorging process might also reduce the stink
and introduce a tiny amount of oxygen into the wine, which will overtime,
eliminates the smell.
Wayne Ahrens from
smallfry
wines also had a say about the article.
"I thought about commenting on your first comment, didn't get there but now am
compelled. I think the single biggest contributing factor to this problem is the
preparation for bottling phase. We are blessed with a completely professional
contract bottling business close by so I am spared the heart burn of bottling
ourselves. Having said that the first thing Ray asks when I turn up with my wine
is, What do you want?
Feedback to
"Drongo Wombat's" Importer Responds with Her Perspective (15August)
Martin Phillipson make a couple of quick comments and asks a good
question.
Is there a prize for spotting the real name of the winery in question? If
defamation laws etc prevent, so be it. I thought her reply was fascinating,
particularly in relation to not changing the price on the Schild 2004..good on
her!
TORB's Responds:
Most regular readers will know that
I am not afraid to name names, but in this case I deliberately chose to mask the
identity of the winery in question. The two reasons for this were very simple;
firstly I did not want to 'hurt' this winery for their actions as they sent
those emails out in an endeavour to try and expand business and there is nothing
wrong with that objective. The real issue is their thinking, or lack of
understanding of the business they are in, and that is the second reason I did
not name them; countless outer wineries are in the same boat and this was used
as an indicative example to illustrate a broad problem.
More Feedback to
Desperado and Drugs of Addiction
(15 August)
As far as port sealed in wax is concerned, as I understand it, the wax may slow
the rate of oxygen flow down, but it does not completely eliminate it, and in
most cases these wines are drunk many years after they have been bottled, which
means any stink has been dissipated by the oxygen.
I doubt the cork lobby will jump on this news; their spin doctors have proved to
be quite adept at coming up with stories that don’t let facts inhibit their
message. As far as who will pick up the cost for wine that has been returned
because it is undrinkable, the winery will have to pick up the cost, not the
screwcap manufacturer, because the balance of components of the wine have
combined with the lack of oxygen to cause the fault. Of course, it is worth
while noting the reductive characters are unlike he’d be found in white wine
that has just been bottled, or at the other extreme, red wine that has been
sealed for many years.
As to how you can avoid buying wines are that likely to suffer this problem,
there is no way of knowing, however wines with high Ph, high disulfide, high
thioacetate, and high SO2 are much more susceptible to the problem.
There is one bit of good news on the horizon. The science of screwcaps, in
reality, is in its infancy and new technical advances are being made all the
time. It won’t be long before producers will be able to order screwcaps that
will allow differing rates of oxygen transmission into the wine.
He will as a matter of course sparge most wines with nitrogen to get the
dissolved oxygen down to an acceptable level.
My argument is that having spent the past year getting my wines stable, why
would I fundamentally change one parameter immediately before bottling.
I am always interested to look at the trials that say " the same wine was
bottled under cork and Stelvin", I think wines should be prepared differently
depending the closure that will be utilised. Alan certainly knows far more about
this subject than me. I just feel that some of the problem is caused by cleaning
the wines up too much pre-bottling because that is what people are accustomed to
doing for corks.
We do maintain a minimal SO2 regime during cellaring to minimise the total
sulphur load on the wine. What I am saying here is we eliminate SO2 additions
prior to the end of malolactic ferment as these additions will contribute
eventually to the total SO2 when they don't help with the eventual free. We add
on average about 60 ppm of total SO2, 3 x 20 ppm adds. I am talking exclusively
of red wines in this context.
Up until now all of our wines have been bottled racked straight from the barrel
with no adverse affects, touchwood. I also read with interest your bit about
winemakers passing off as "perfectly sound" wines with obvious Brett."
Mark Dingham had a few well chosen words about this story.
I have just been reading the stories here - wombat dung is a good laugh - sad
its true. I'm a part-time marketing lecturer at the University of Western Sydney
I'm using Southcorp as a case study!! Yes, it is such a screw-up that even the
students laugh at it, yet there are heaps in other industries too.
And they had no idea of branding!! They moved the $$ from above the line to
trade discounting to try and gain market share, thus devalued the brand. I sold
my shares in SC after the take over. Good thing too.
Barry Silcock writes from the UK
And more feedback on a
Feedback
to a
news item - France becomes creative with wine labels
(9 August)
The article from the above link on your web site is quite right about French
wines breaking the mould of "old world" France and joining the 21st Century.
Here in the UK they are selling this Sandpiper named wine with a trendy label.
What is interesting in this one is that the French are now calling their beloved
Syrah grape, "Shiraz". This is quite a turn around for them I'm sure as they are
obviously looking to claw back some market share from you guys down there.
Enclose a couple of pics of the label. The wine was very tasty too and I'm sure
I'll go for another bottle from the UK supermarket.
I just read the article about Constellation Europe telling staff to buy wine. I
thought to myself, must tell Ric, then I saw it on your website! I reckon that
happens here all the time. Sometimes I think I'm getting paranoid. Over a period
of a week or two we'll get people at all our stores asking for wines that no one
ever asks for and I often suspect it's the wholesaler or winery sending sales
staff around.
Feedback to
Desperado and Drugs of Addiction
(9 August)
Ken Onish - a partner in
SouthernStarz who
imports wine from Australia (and other southern hemisphere wines) wrote in with
his excellent perspective:
This is one of your best articles. I support most of the points of views
expressed by our colleagues. However, we make a mistake to look at this as a
uniquely Australian wine marketing problem.
And one of Ken's customers, Tom Caufield, an excellent retailer in Iowa,
wrote to him with this comment.
I’m really seeing a lot of my customers that, even 2-3 years ago were
ga-ga for a lot of the “goo-monsters” from Australia come to me and say that
they’re sick of those wines and don’t like drinking them anymore. They may still
be buying Aussie wine but they are buying Memsie, Mitolo and others that
actually have some balance and structure, not just the overripe, oversweet, out
of balance stuff. Thanks also for the Buller table wines. Those I’m sure are
going to be way over the top but we do have some folks who still really dig that
style.
Gerald Weimax
a US wine retailer and
regular correspondent had a few words to say about the current topics on this
site.
I just heard the giant Constellation Brands is moving its portfolio of
"Pacific Wine Partners" wines to the same California liquor distributor that's
run the Rosemount, Penfolds and Lindemans' ship aground.
Celebrated Brands
Blackstone Winery
Barossa Valley Estate
Banrock Station
Black Box
Four Emus
Hardys Wines
Knife & Fork
Nobilo
Rex Goliath
Twin Fin
Cellar Door
Brookland Valley
Chateau Reynella
Hayman & Hill
Leasingham
Starvedog Lane
The Jibe
Yarra Burn Please remember our previous
email, this distributor is "The Bermuda Triangle" of Wine Sales!
Well, we'll see about
Constipation's, uh, movement of wine. Since Penfolds has been with that liquor
firm, they don't bring by their wines. I guess we're supposed to buy them for
their fame and prestige. It's been years since we've been shown a range of
wines, of course. The other liquor distributor, Southern, is even worse. Both
companies add a $2 charge per delivery for "fuel expenses." As though they're
not making enough money as it is!
General
Gerald Weimax
again has a say, but this time on another matter.
I the suggested that he go out and go buy a bottle of this producer's wine to
taste for himself and see if the wine they sell is actually the wine he's
presented. A year after this suggestion, no response. This year, though, the
rating for this wine slipped from its "Grand Cru Burgundy" status and 95 point
rating down to 90 points. I'll bet you a sip of Shiraz that it's less than 90
next vintage.
Feedback to
Wine Australia 2006 - Overview
(2 August)
Bruce Routley wrote in with his thoughts on Plonk Oz.
It was good to catch up, all be it rather briefly. I thought I would give you my
comments of the day. Overall, I was disappointed, mainly due to the vast lack of
wineries. I remember a previous one, where Stephen Henschke was pouring Mt
Edelstone to everyone. There was not that many wineries there that had wines I
wanted to try. McLaren Vale was pathetic. At least Hardy's was there, and had
Reynell and Eileen on the table. Barossa was a bit better, but still pretty
poor. It was brilliant to see Torbreck dishing out all their top reds. I
did ask for some under the counter wines, and had some luck, but forgot to ask
O'Leary walker about the Clair Reserve. NSW was pathetic. I had trouble finding
it. I found McWilliams, and asked for a taste of Lovedale, but was told they had
none. The 04 Graveyard was disappointing. If I owned a winery, I would be there.
I spoke to the Scarpantoni boys, and they said it was really expensive to have a
stand, plus the wine they give away. Maybe the organisers should cut costs to
have cheaper stands. There must be a reason why so many smaller wineries
didn't come. It must be the cost. And Fosters, that's pretty slack.
Mike Pollard
I can’t let the comments of Martin Edwards (see below dated 26 July) on Open
Mouth and Extract Foot go without a reply. In terms of questioning Cam’s
background as a critic, one might ask what qualifications does Martin have that
certify him to judge Cam?
These Guys Couldn't Lie Straight in Bed
(27 July)
Thanks to David More for
sending me this one. The Australian cork spin witchdoctors are at it again. Have
a look at
the section "Cork the Perfect Fit" (follow the instructions on the linked
page to view the text). This cork mob states corks are "impenetrable to both
water and air". If that is the case, next time you have have a
bottle that leaks ask yourself how is it possible? Obviously its just good the
"good stuff" leaking and the water in the wine stays in the bottle!
And if you open up a bottle that has
oxidised, ask yourself how could it be so? It must be your imagination because
the cork people tell us corks are impenetrable to air.
The mind boggles! These guys couldn't lie in bed
straight! And naturally there is no mention of cork taint!
Readers Feedback on
Open Mouth and Extract Foot
(26 July)
Martin Edwards, once again has comments that are worth thinking about.
While I agree with the basic thrust of your article (ie.
that Graeme Miller Wines handled the criticism of their wines extremely poorly,
both at the Show and later by email), I can't help thinking that Cam was also a
tad out of line. His TNs could have been a little more circumspect and I
certainly don't believe he should have attached numerical ratings to wines he
believed were faulty.
Gary Walsh of
Wineorama on the other hand, had a different perspective.
I don't see much point in you directing level of
negativity to a small winery. One could almost say you are as much of a 'bully'
as the winery was in the first place. More importantly, publishing email
correspondence between two parties on the internet is a loathsome habit. Really
bad form.
TORB's Comment:
Whilst I am not trying to defend or justify my
comments, without quoting the emails, the story
would not have made any sense. As long as the topic is not of a personal
or private nature, (or correspondence between friends), I see no difference
between quoting what someone says in person, or quoting their comments from an
email. People have to take responsibility for their own actions.
More Readers Feedback on Foster's to
Unload a Crown Jewel
(Wednesday 18 July)
Andrew Sutherland-Smith of Warrabilla Wines had some interesting ideas
about the sale of Seppeltsfield. He wrote....
I have heard there is 14 million litres of inventory and the sale price quoted
at $35 million, which equates to $2.50 a litre, not including the 100 acres of
vines or the value of the fixed assets like buildings infrastructure etc.
TORB's Comment:
Unfortunately I have no way of verifying Smithy's numbers; they could
be accurate or they could be completely inaccurate. I did approach Fosters but
received the expected "no comment."
Readers Feedback on Foster's to
Unload a Crown Jewel
(Tuesday 11 July)
Mark Wickman
One of my original inspirations for wine
and my subsequent fascination for Australian wine and its history came from
doing a tour around Seppeltsfield while waiting for their computers to reboot (I
was working for IBM GSA at the time). What I found absolutely fascinating was
the story behind the planting of the palms. It is about a business being more
than just about profit and loss and about loyalty to ones employees and the
wider community. I thought it ironic that Fosters (an Australian iconic name
itself ) should happen to be selling something that is so unique to Australia.
Mekaal Hassan wrote in with some perspective comments and
questions.
It is with some distress that I read your article
about the proposed sale by Fosters of its Seppeltsfield operations. There are
clearly a few things that I don't understand about big business - maybe you can
sort me out on some of these.
Matt Schmidt states a couple of times that it
does not fit the business model. What does this mean exactly? He goes on to
explain that the company is looking for development of global brands. My take on
this is twofold. One - what if nobody knows that a particular brand is part of
the Fosters empire. I for one find it pretty hard to keep up with who owns what.
I would think that the success of a few mega-brands (eg Yellowtails and the
like) would be sufficient and the ownership of other less dominant (but
profit-making) brands would not detract from the corporation's goals. Two - what
if it is known to be a Fosters brand and not in line with company objectives? If
a brand is a little out of kilter with the overall objective of a company what
is the damage done (particularly in a case such as this where the product is so
good, has such history, and, one suspects, profit-making).
TORB's Comment: The proposed sale of Seppeltsfield is
about one thing and one thing only; money. It is unlikely the operation is
making money in its own right; it's more probable that it is losing money, and
Foster's wants to get out with as little cost as possible. As for Foster's
selling an icon, according to their web site
profile
page, "Foster's Group is a premium global multi-beverage company delivering
a total portfolio of beer, wine, spirits, cider and non-alcohol beverages. Our
products inspire global enjoyment and are enjoyed by consumers all over the
world." They are not interested in Australia, they are interested in the world.
Still More Readers Feedback on A Heritage
Wine Investor Tells His Story
(Tuesday 11 July)
Julian Gutierrez emailed in these comments.
I'm sorry, but your unsatisfactory article
"A Heritage Wine Investor Tells His Story" does nothing to convince me that
those (your "Maxwell Smart" included) "burnt" in the downfall of Heritage were
not "greedy bastards" nor "idiots".
TORB's Comment: I am sorry
you found the article unsatisfactory Julian. For the record, and I have
stated this countless times over the years, I agree with your final comment that
wine was made to be drunk and unfortunately for wine lovers, investors do
drive the prices up on many wines. The intention of the article was not to
convince you that wine investors were "not greedy bastards" - the intention was
to explain one persons experiences. In regard to your crystal ball
comment, you make an excellent point; when Max told me his story it was a couple
of years after his initial purchase, and after all that time, it is quite
feasible that he got one consideration/reason wrong in telling me why he
picked the Balnaves; that aside, Peter Bissell was and is still a respected
winemaker.
Readers Feedback on
Reporting or
Advertising? (a parody)
(Sunday 9 July)
Campbell Mattinson of
Wine Front recently
wrote in with the following, and as usual, it displays a well balanced and
thoughtful perspective.
I just saw your piece on "magazine journalism" where you
queried whether or not Nick Ryan's feature on the Southern Highlands was
influenced by advertising. While I had nothing to do with that article and
haven't discussed it with Nick, I have written many similar features and so feel
fairly well versed with how it all works. Basically I think (in the case of
Gourmet Traveller Wine) it goes like this:
Readers Feedback on It Was
Entirely Predictable
Andrew Sutherland-Smith of
“The recent comment regarding grapes never being a viable source of ethanol for
cars worries me.
Never is a long time! They did a trial on growing grapes at 100t/ha which would
have been a success if they reached 10Be and they got it to 12.0~!!!!!
Now if those grapes were beside the still so that freight wasn’t an issue, and
we could get an extraction of 800 L/t that equals 9,408 litres ethanol per
hectare.
Stills are very bloody efficient in removing alcohol for a low price (they
recover the heat used against the feed to the still) and can use crap fuel (we
used unrefined black heavy oil {$hit} at McWilliams Robinvale;) though if you
could use LPG near the main pipeline it would cost very little.
The mistake made is to say that wine made for human consumption at current
cropping levels doesn’t equate to viable fuel; there is no argument there: but
could a bio-fuel industry at big cropping levels near stills be a different and
possibly viable alternative to growers stuck in this government made shemozzle?
Bloody good question that deserves a better answer than a “never viable ever
ever ever” response.
More Readers Feedback on Trouble at the
Top End
(Monday 3 July)
Bob Foster has been in the wine business for a long time and is Chairman
of Judges of a major wine show in the US, so he knows which side is up. He had
this to say.
“In the area of lost opportunities-how about giving up on
market dominance? Ten years ago Seppelt was a major player in the US market.
Now, they basically import an occasional old muscat or other dessert wine.
Today gems like St Peters are unavailable and thus unknown in the US market. If
you go to the Seppelt web site, they list a US importer. I called them and was
told, sorry no. I sent Seppelt an email asking why they had given up. They
forwarded the email to their US (non)importer for a response. It's been a
fortnight and I've heard zero. From dominance to oblivion! Sigh.”
More Readers Feedback on A Heritage
Wine Investor Tells His Story
(Monday 3 July)
Graham Wright of
“Nice article on Max the Heritage investor. Needless to say,
we are starting to see the first signs of the Heritage stock coming onto the
secondary market. Some investors are realistic in their expectations but alas
many are not, with some trying to do the hard sell on us. It still amazes me how
intelligent and prudent members of the big end of town got involved in this
scheme.”
Adam Catford has a background in the investment
business so his comments are most interesting.
“In reference to ‘wine speculation’. Wine was never truly
and investment at all…… Various definitions exist for investment – however,
after 20 years in the Financial Planning and Investment industry, the following
is, in my opinion, factual.
An investment is the purchase of an asset in which one
intends to participate in the income (profit – as opposed to capital gain)
generated by the asset. (If the asset manages to increase profit/income over
time, the asset may also rise in value). Perhaps unoccupied land is an
exception, but few would argue that land with a property which also generates
rent is a better investment than holding the land alone.
Speculation is the purchase of an asset (whether or not it
produces income) in the hope that the value will rise and a capital gain will be
achieved. Wine is not and never will fall under the definition of investment to
me; nor does art, collectibles or antiques.
The best caveat investor to me is this: Does this
‘investment’ produce a relatively (compared to bonds/stocks or reasonable other
benchmark) acceptable income and/or profit (some companies produce great profits
but due to their capital intensive nature reinvest these profits to expand the
business – but still create profit without a dividend), and is it possible this
income/profit could/will rise over time?
Maybe if we all used these guidelines we wouldn’t buy IT
stocks with big ideas and no assets, wine, art or other scams we seemed to be
sucked into so easily.
Watch – in 3 years we will be in undersupply. Every industry
has a cycle and almost predictably, every industry has a 20 year or so ‘crisis’
– everyone needs to calm down.
Other than the few unfortunate established growers who will
go broke, along with 80% of all start up businesses (that is a true stat,) so
let the folk who screwed up live and learn. Who bails those 80% of startups that
go broke? Answer – No one!!!! Did you hear the Government bail out all those
stock brokers who started up in the 5 years before the 1987 stock market crash?
No?? That’s because they didn’t….get the idea. Victims there always will be;
and that is life, or part of it.”
Finally this one was from Neil Charles (and was
written up in a previous Irregular Update) who is wine retailer in the US.
“I just finished reading your story about the Heritage
fiasco, and found it most interesting, especially when I saw that Balnaves was
one of the wineries whose product was involved. I have a long history with
Balnaves' (former?) importer here in the U.S., and can reliably inform you that
their wines, however wonderful, never caught on in this country. It's a real
shame, but I recall as recently as last year trying to sell the 99 Cabernet in
Boston and several other markets to almost no avail. We finally knocked it down
to around $25US (retail), and moved a few cases. I think the rest of the vintage
has since been closed out by the importer for almost nothing.
Had Heritage ever succeeded in getting their wines to the US,
I fear that the combination of shipping, taxes and intermediate costs would have
pushed the prices well beyond the realm of the reasonable. As you correctly
mention, the demand in the US for Australian Cabernet, however good it may be,
is virtually non-existent. We have way too much of our own (overpriced) juice to
sell. All I can say is Caveat Investor!" As an aside, last week Canterbury Wines
in Melbourne advertised a "museum release" of the 99 Balnaves Cabernet for
$29.50 a bottle, much the same price as it was on release a few years ago.”
There was a large amount of feedback to this story, most of it short and in
agreement but some of the comments are worth posting in detail.
Gerald Weimax
a US wine retailer
emailed his perspective and experiences in trying to sell Australian wine
in the Californian market place. He makes some an excellent points and they help
to further explain what is happening in this important market place.
I had a few thoughts on the state of Australian wines here in our little corner
of the planet.
Mark Gifford of
Blue Poles
Vineyard had this to say.
Mike McGuigan (no relation to the Aussie Brian) said,
"I found your article most interesting. I live in the US, but come to OZ
annually on business. For the past 4 years I've made the sacrifice and headed to
the Barossa for fun and education. A couple of the locals, including Steve
Norman, took me under their wing three years ago while I was getting my six pack
allocation of Basket Press at Rockford and introduced me to some of the smaller
quality producers there. I'll never be the same. To make matters worse, Steve
introduced me to Gavin Trott in Adelaide last November, and two cases
later......
If you would like to see independent, US wine lovers reaction to this story, it
can be found on the
WCWN Forum and its worth reading.
Once a winemaker came in trying to sell his wine, and then 20 minutes later a
lady came in asking for the same wine - a wine that no one would ever asks for.
A quick visit to the winery website showed the lady was the winemakers wife!!
That happened 2 weeks ago! Desperate times call for desperate measures I guess.
Americans know at best the geography of California's wine regions and the basic
regions of France Germany and Italy. Few know that Australia has wine regions
and there is little knowledge of the major cities or states.
And yet we are most like you and visa versa. So let's try to get to know one
another. We never even had a "blind date" and now you propose marriage. We don't
know why you should be attractive to us. Your wine history is unknown to us.
What you are trying to achieve is misunderstood. You appear to be copy-cats and
yet you are great innovators.
Why should we switch or experiment from what we currently consume? It's a zoo
out there and you are the keepers. Not a great image.
What we need out here is more point of purchase information for the consumer.
More differentiation in wine regions and their wine styles. A tour of the U.S.
organized by the major wine regions every 90 days until the story is understood.
I'm not sure that the small grower/winery needs to know about wine by the glass
programs as much as he has to understand the international competition with whom
he or she competes. Packaging is relevant, style important, and consistency
essential.
These brands are listed below:
I'm much bemused/amused by the winery threatening that fellow whose tasting
assessments are posted on his web blog. I received nasty calls from vintners,
periodically, when we post the results of our blind-tastings.
One fellow asks $75 a bottle for Pinot Noir which tasted like a wine made from
raisins. It was dark in color and reminiscent of a late-picked Zinfandel. It was
a terrible Pinot Noir. The guy took me to task for collecting the tasting
assessments of some of our tasting participants and assembling, as we routinely
do, a paragraph of tasting notes and adjectives. I posted my own notes, too.
This winemaker castigated me since "Robert Parker rates my wines highly and gave
this 95 points. Further, my wines are served in the finest restaurants in the
country!" Curiously, this guy makes 300 cases of this and 90 cases of that and
can supply restaurants from California to Texas to New York.
After a second vintage of tasting this guy's wine, I sent Parker a letter saying
he's either got it wrong and cannot taste Pinot Noir or, more likely, they have
submitted a wine different from the wine they sell. Parker responded suggesting
my bottle had been "cooked" and I wrote back to say, "Listen, Buster...I'm a
hundred miles from the winery and paying for these bottles with
cash...hard-earned money. You are 3,000 miles away and being given 'samples'".
At least Constellation was there.
The top wines I wrote down are:
Kilikanoon Covenent - best wine on the day
Kilakanoon Oracle
04 Reynell Cab
03 Wirra RSW
04 Heritage Rosscos
04 Torbreck Struie
04 Torbreck Factor
03 Jim Barry Mcrae Wood Shiraz
04 Jim Barry Armagh
04 Fox Creek Reserve
I am unaware that there is a qualification requirement for wine critics? Robert
Parker Jr had none when he started; I believe he had no formal training in wine
appreciation at all. He is a partner with family members in a winery, but that
occurred well after he achieved success as a critic. What qualifications did
Campbell Mattinson have before he started? I believe he was a journalist. James
Halliday? Like Parker, a lawyer. Its true that Halliday was a partner in
Brokenwood by 1970, some 7 years before he became a wine show judge, and while
his biography lists tremendous experience I don’t see any formal qualification
as a Wine Critic. Len Evans? Among his multitude of achievements, Evans was the
first regular wine columnist in Australia, but again his bio does not list any
formal qualification as a wine critic. Quite possibly, like many of us, these
individuals started out with some serious formal (and informal) wine
appreciation at various levels, and coupled with their innate abilities as well
as good old fashioned hard work, and no doubt the odd bit of luck, have achieved
well deserved success.
The other attribute these individuals have in common is passion for their
subject. Having shared a few bottles with Cam its pretty obvious that he is
passionate about wine as well. And taking the time to run a wine blog certainly
shows commitment. Does he have to tell everyone that he may write about their
wine? Do journalists do this? It may well be that one of the reasons that we see
so little commentary on wines that fall into the not recommended category is
because critics don’t wish to deal with wineries complaining about the bad
press. But wine blogging will very likely change this as the numbers of
individuals critiquing wine grows. It is true that there will be/are wine
bloggers of dubious talent and intention on the internet. And so the potential
for abuse is great but from Cam’s experience it seems that (some) wineries
already have their response to that worked out.
It would have been much better to email the winery and ask them whether they
wished to provide alternative samples before he wrote up the wines as he thought
the samples he had tasted were faulty. If the winery said they stood by the
samples he tasted, then he is entitled to bucket them on his blog if he is so
inclined. As you said, most wine writers would not write the wines up at all if
they thought the sample may not be representative.
I don't know what Cam's background to qualify as a critic is and his site
doesn't really provide any information on that but I can't help seeing this as
part of a wider concern relating to the way the internet allows one person's
opinion to become attached to a commercial product without any real
control...It's all very well to stand on the principle of free speech but there
is a inferred requirement for anyone holding themselves out as a critic, as you
do when you create a site and publish your opinions, to give a commercial
operator the opportunity to redress a problem before you publish.
I have no doubt the wine tasted like
crap and I understand that he did question the soundness at the time, but I
doubt he told them he was going to publish. That's the "ethics" issue. With
publishing freedom goes responsibility to ensure the "story" is correct.
I think a lot of people are still coming to grips
with the responsibilities which go with the power of internet publishing.
Now if that’s 14 million litres of old stuff, the price is a bargain!
If there’s 13.85 million litres of two year old gear, with the really good stuff
(or even a large part of the old gear) shived off to Penfolds etc, it’s a lot
less of a bargain.
The big question is how much damage has been done to stock by Fosters. How much
old stock (like Grand) has been pumped quietly into the marketplace?
The sale of Seppeltsfield could be done really well if the stock is intact and
the incoming owner could
A) Park it for a period to remove the Seppelts labelled stock from the
marketplace
B) Relaunch a new label with wines being made to much lower volume
requirements...i.e. instead of 5000 cases of Grand Muscat a year make 1,000
cases and make the Rare really rare. It would be sustainable and you could make
these already world class wines Stellar! The new owners could take on Chambers/
Morris Antiques head on.
Imagine what the company would be worth in five years time with a world class
reputation and lots of 98+ scores from RPJ, especially a leaner finer
organisation! Double/ Triple/ More?
It would cost naff all if they released trickles of stock to the bulk market to
fund new wines (effectively swapping inventory.)
The All Saints fiasco fifteen years ago (with only one million litres) of
fortified wine effectively depressed the fortified market for 5-6 years. What’s
the effect of 14 million badly handled?
If AMP or the big Superfunds aren't looking at this in a big way, I'll write to
them myself!
To sell 20,000 cases at $500 average a case still equals $10 million per anum.
If I was sitting on 14 million litres of fortified that would be a piece of
cake! 180,000 litres per year sold with 14 million litres in stock........ Hmm
that’s 78 years supply if you don't make another drop.
Oh what the heck….. I'll just borrow the $35 million myself..... in for a penny,
in for a pound!
Firstly, the motivation to sell is not clear to me. "It does not fit in with
our business model; we are about building consumer relevant brands and
continuing to promote our wines globally, and it is not inline with our global
business direction." "In terms of fortifieds not being profitable, that's
not the reason we are selling; it's about a site that does not fit into our core
business model."
"It is a beautiful, magnificent facility, and clearly THE jewel in the
Barossa wine industry, and possibly the Australian wine industry; but we are
unable to provide the attention it deserves. It needs a prestige tourism
operator, who is prepared to invest heavily, so that they are able to do the
site the justice it deserves." It is far from clear to me - having been to
the cellars in the not too distant past - what investment he refers to. What
would you change and what would be the result? Is he really suggesting that a
tourism operator run a wine-making business? Why wouldn't a wine-making business
engage some tourism consultancy if there was any perceived requirement in that
regard?
"When I asked Matt if Seppeltsfield was profitable, as expected, he declined
to answer the question; but he did state the sale of fortified wines was
dropping by 10 percent per annum and that as sales drop, businesses need to
reassess their operations." This is a pretty high level demographic
statement. He could have made a statement that the sales of alcoholic beverages
is going up and legitimately applied that. Sales of multi litre flagons of
fortified wines may be going through the floor and driving fortified sales down
overall, but the top end may be holding firm. Furthermore trends are trends, and
we have seen how wildly they have fluctuated in the Australian wine market over
the last thirty years.
Any chance of forming a syndicate to get our mitts on this jewel? You can count
me in for my share.............
When did Maxwell make his initial purchase with Heritage? Your article states
that Max "didn't rush in, doing his research and homework". This "research and
homework" must have included the procurement of a crystal ball, as Balnaves'
winemaker Pete Bissell was not named as Wine Winemaker of the Year until
June/July 2005. Heritage had moved to voluntary administration on March 2 2005.
The fools seduced by the notion of "wine investment" do nothing but make wine
more expensive for those who simply wish to enjoy drinking it.
* magazine commissions freelance writer to pen a feature on *insert winery
region here*.
* freelance writer pens feature article with complete independence
* freelance writer submits article to magazine, and that is that last the writer
sees of the article until it appears on newsstands. The writer does not view the
edited article, and not the way it is laid out, and certainly not the list of
advertisers at any stage of the writing process
* magazine lets the region know that an article has been written on it, and
tries to sell ads off it. This does not influence the article itself in any way.
During this sales process it is possible that individual wineries ask whether or
not they have been mentioned in the article - but this does not influence the
article, as it is after the fact of it being written.
* the magazine is then published.
I've been writing for newspapers and magazines for 20 years, and I've seen many
instances where the editorial process is "tainted" by advertising. I do not,
however, think that the above process is. The writers of these "regional guides"
work independently and never see nor hear anything from anyone on the
advertising side of things.
1. Having the giant conglomerate of Southmont or Rosecorp is a total mess from
my little perspective. Those firms used to offer decent entry level wines and
were competitive in the market for floor-stack space/shelf space. Now that
they're lumped together, you have the same company vying for limited
space...they're not really doing much of a job of competing. They would probably
be better off if they were split up and actually actively competing....
2. The high-priced "carrots" have become so costly there's not much interest in
them. That means the "sticks" that are paired with the carrots don't warrant a
place in the shop unless the wines are top notch, good values and will bring
repeat business.
3. The marketing people here have made some critical mistakes. Within the
Southcorp realm, for example, they have Seppelts wine. We can find customers for
Seppelts' Tokay, for example. But they've discontinued this wine since it's
"work" to sell it. Okay...so now we are not selling Seppelts Tokay, nor other
Aussie wines. We can sell Spanish Sherry to our customers instead. I hope the
Seppelts people are thrilled. They had a line of "jug" wine which worked nicely
for us. It was a basic, bare-bones little Chardonnay and it was not
well-distributed, so it worked nicely for an independent shop such as ours.
Unfortunately, the marketing folks decided this was, again, "too much work" and
so they eliminated the brand in our market. They were hoping to focus on their
main labels. But you can't penetrate each market segment with the same labels
because they cannibalize the marketing of a brand...if you're going to sell some
labels for $5 a bottle at the Trader's Joe's chain, please don't expect
independent stores to handle these wines. We cannot possibly expect to pay the
$7.15 wholesale price I see in their distributor's catalogue for wines that
Trader Joe's is offering to the public at $4.99 or $5.99 a bottle.
When they have "unpublished" pricing and lazy sales reps, how can you possibly
expect to get your wines in distribution?
I had asked the sales rep for some bottles of things such as Penfolds' Grange.
One day two "suits" came into the shop to see if I was really interested in such
a wine. (Penfolds had changed distributors shortly before and the new folks have
been a disaster, near as I can tell.) They were trying to point out the Grange
was a "reward" for selling their other wines. "Your sales are down." they told
me.
"No kidding! Really?" I asked. Then I pointed out that we had to discontinue
wines such as Penfolds Sem-Chard because the vintage they were selling at that
point in time was three or four years old and the bottles were oxidized and
spoiled. The firm had stopped bringing in that little jug Chardonnay we were
selling at the rate of 5 cases a week. One other white wine they had was also in
a borderline state of spoilage and so we stopped selling that. "No kidding,
sales are down?" I asked these rocket scientists. Wow.
I just looked on the web sites of some competitors...one company offers but one
Penfolds item and the other major shop has three Penfold items. One of them has
Rosemount Shiraz (best wholesale price listed is $6.75) for $7.99 a bottle.
Neither of these companies carry anything from Lindemans. A few years ago, these
brands were sold in these stores, but when there's no incentive to carry them,
well, too bad.
4. Another big player, Jacobs Creek, announced it was selling its wines through
Wal-Mart. If that's your idea of marketing, knock yourself out. This sort of
sales outlet really diminishes whatever shred of luster you had. We discontinued
the stack of Cab/Shiraz we'd been selling for $6.99. My larger wine shop
competitors don't handle any Jacobs Creek wines either.
5. All the huge red wines from Australia which have residual sugar have been
detrimental to the market. We don't see customers coming in and looking for
"Australian wines" as they did a few years ago. It was, perhaps, a bit of a
novelty to start. But if you have good wines, fair prices and sensible
marketing, you'll find success. But when people taste these huge, monster wines
(not that California doesn't also make this sort of stuff) and find they're
undrinkable with food and are only good in a blind-tasting, they start looking
elsewhere for wine.
6. We've done tastings with wines that have been "highly rated" by various
critics. Parker, The Wine Spectator...if these are the best Australia can offer,
well, then we can only conclude "Australian wines are not to my taste."
Now Australia is known for "cute" wines. Wines for people who don't drink wine.
(That's not my customer...sorry.)
Do wines such as Feral Fox and Lucky Lizard sell in your part of the world?
(They're supposed to fetch $30 a bottle here). How about "Shoo Fly" Buzz Cut
White??
Well, the whole market for Aussie wines seems to be quite a mess. The big
statewide distributor for D'Arenberg, who also has Southcorp to sell, has 2001
Sauvignon Blanc from D'Arenberg in the catalogue. Laughing Magpie Viognier is
2003 vintage presently. They have 2003 Wynns Chardonnay and 2003 Riesling.
There's a lot of old wine to be sold.
I've been writing this as we're closing, so it's not the most well-thought out
missive I've sent you, but you get the idea.
While the US market is now flooded with Yellow Tail and others of the same ilk,
I won't touch the low end stuff. There are so many really good drops from that
area that it seems silly to waste one's time with ordinary wine. Some of my
prizes are from Rockford, Kaesler, Kalleske, Glaymond, Torbreck, and even one
Greenock Creek Roennfeldt Road Shiraz. My hope is that I'll live long enough to
enjoy them after these babies grow up.
I get great satisfaction out of going to a restaurant with friends and choosing
wines they've never heard of. Most of the time I'll choose an Aussie, and most
of the time it's a real success. Just recently I found an '02 E&E Black Pepper,
and thanks to the generous expense account, that was the choice. Now I hope I
can find more at the retail level.
I'm always on the lookout for good Aussie wines, although as your article
rightfully points out, they are becoming harder to find over here. Not many
local retailers have the better ones OZ has to offer, so I'm forced to search
online for the gems. Not meaning to be greedy, but the misfortune of the
importers/retailers could be a real opportunity for those of us that appreciate
the better wines, and I'll be on the prowl."