An Icon looses it gloss

For years I have been saying that Icon wines with no long term record that came out of nowhere and shot to stratospheric heights (and prices to match) based on a few reviews by certain well known writers with cult followers “should be regarded as a fashion statement.”

Like all fashions, they are subject to rapid change and as anyone who has been in the fashion business will know, it’s an industry with a huge business mortality rate. This week, Torbreck Vintners went into receivership.

David Powell started Torbreck in the Barossa in 1994 and the first vintage (1995) of the famous Run Rig was released in 1997. Initially quantities produced were very small and the wines sold at modest prices, about $40 from cellar door.

After some glowing reviews and (high points) by Robert Parker, the winery became an icon and prices for the Run Rig rocketed fetching up to about A$1,800 on the US auction markets. Not bad for a $40 wine but one must ask why was it so important for people to have this wine and pay those sort of prices?

Yes the wine was unquestionably good, some may even possibly say great, but the prices were fueled by the “I must have this trophy wine to show off syndrome.” It became a fashion statement for the wealthy to serve this wine.

As soon as the price rocketed on the secondary market, the retail price of Run Rig in Australia also rocketed to about $180, assuming you could even get it. At the same time, over a period of a number of vintages, David Powell, now a superstar expanded his product range so people who wanted to drink Torbreck wines but who were not prepared to pay $180 for Run Rig or even $125 a bottle for The Factor (Shiraz) or Descendants (Shiraz Viognier) could afford to do so.

Some of the wines Torbreck released were The Steading (a Grenache Shiraz blend $32.50), Juveniles (an unoaked Grenache/Mourvedre/Shiraz $27.50), and finally The Woodcutter Red at about $19. A quick search of WineRobot shows multiple vintages of some of these wines are still available so one can only speculate how quickly and how well they were selling in Australia.

One also has to wonder about the US situation too. About twelve months ago, the winery parted company with their US distributor and set up their own direct US sales organisation.

The Receivership is still early days and on one knows if the winery will survive. It may also take some time for the reasons for the business failure to become known. But one thing is for certain; a rocket ride to stardom on the back of some high ratings by Robert Parker is not a guarantee for long-term business success.

In fact, it’s possible that a “high points” blessing from Robert Parker that turns a wine into a fashion icon causing unrealistic expectations by the winery and short term growth problems may also result in long term issues if not managed properly. To all those who are hoping for a high score by Parker and rise to instant stardom, be careful what you wish for, you may get it.

Fashions come and fashions go, but a but a business that has foundations that are built on a track record of making high quality wine at reasonable prices with a well managed fiscally responsible business and a loyal customer base is a solid business and one that’s hard to beat.

Cheers

Ric