Crain’s New York ran a piece over the weekend pointing to a 14% rise in wine shops in NYC since 2010. Will the proliferation of shops “bottle up profit” they wondered?
The short answer is: no.
There’s a huge thirst for wine in America right now and especially in New York City. The city has some terrific shops and, throwing in the knowledge and offerings at the city’s restaurants and wine bars, it is today the best wine destination on the planet (here’s looking at you, Paris). Sure, the existing 1,368 wine shops can serve the city’s residents and tourists. But a growing market that’s relatively protected (grocery stores can’t sell wine) will probably mean more stores in the coming years.
Today, there are discounters and full-service shops. There are ones focusing in small estate wines and others with lots of well-known brands. There are shops with particular slants such as selling wines made by women, wines from California or Chile, wines from a single importer, shops that sell wine by occasion or food pairing rather than region, or shops that have tastings every day of the week.
Not all of them will succeed. But the more the merrier. While some of the unsuccessful approaches may be reoriented in another four years, I’d venture to say that, barring economic collapse or a shift to allow chains or wine in grocery stores, the number of wine shops will be higher still, by a similar measure as over the last four years.
One thing that could improve the finances of these small shops (chains are not allowed in NY), is if they could also sell craft beer. That happens in Connecticut and levels of social unrest are not higher as a result. In places like Illinois or New Jersey, wine shops can even sell gourmet comestibles, such as cheese. Imagine!
Registration for my fall wine class at NYU is open. It starts on 10/16 and runs six consecutive Wednesdays.
In the class, we survey the wine landscape, discussing they story of wine in several key countries and covering hot-button issues. Each class includes a tasting to highlight points from the discussion. It’s a non-credit course without grades, so you don’t have to worry about failing a wine class appearing on your transcript!
It’s always great to meet site readers in the class–so check it out!
Consolidation strikes the Empire State: The Vintner Group, the Virginia-based distributor, is acquiring Martin Scott Wines, a distributor based in Lake Success, NY.
Founded in 1990 by Martin Gold and Scott Gerber, Martin Scott Wines has grown to have a thick “book,” distributing wines from about 450 wineries, ranging from Domaine de la Romanée Conti, Bonneau du Martray, and Jacques-Frédéric Mugnier in Burgundy to Ponzi Vineyards and Chateau Montelena from the US.
The Vintner Group, formerly known as The Country Vintner, is an importer and wholesaler of fine wine and spirits. CEO David Townsend has led the company on an acquisition spree of late and the company now has operations in nine states in the mid-Atlantic and southeast. They now add New York, New Jersey, and Connecticut to that list. According to Shanken Daily News, the company recapitalized in the mid-2000s and now have Brockway Moran as a private equity partner.
What does this mean for the New York City wine market? If you’re in the trade, share your thoughts in the comments. Here’s a link to the press release.
Both UC San Diego and San Diego State announced this week that they are offering craft beer classes–for credit, not in dorm rooms. Much to their credit, the press release actually had a beer pong joke. Then it pointed to the commercial opportunities in the $300 million a year craft beer industry.
On a related note, I’m thrilled to be teaching my first-ever wine class for credit later next month. I know, what if a student gets an F in “Fundamentals of Wine” on their transcript?
The class is offered at the New School in the Continuing Education school. Starting on a Wednesday evening, we will have a three-hour lecture/seminar about some of the macro-historical, economic, political and critical aspects of wine. Then on Thursday, we will head to wineries in Long Island to kick the dirt, talk with winemakers, and sample wines. The next three days will offer tastings at the International Culinary Center. On Sunday evening, we will conclude by meeting in a wine shop to discuss the business of wine and retail.
I haven’t finalized the syllabus yet but each part will count toward the final grade and there will be a final essay/writing project.
As far as I know, this is the first for-credit wine course offered at a university in NYC. Should be a pretty fun two credits.
Fundamentals of Wine NFDS2830
A 5 session(s). Wed. thru Sun., 6:00 PM-9:00 PM, beg. June 26.
Michael Skurnik, Polaner, Winebow, David Bowler, Verity, Wildman, Martin Scott and others are each pouring their fifty best wines at a public tasting to benefit Sandy recovery. So that’s 600 wines–yikes! The $50 entry goes to the Mayor’s fund to advance NYC – Hurricane Sandy relief. May 1 – 6:00 PM
In a surprising setback for selling wine online, the New York State State Liquor Authority ruled yesterday that the sale of wine by third-party “advertisers” violates its code. Some online sales and marketing companies, such as wine clubs and Lot 18, sell or market wine online without a New York retail license, instead rely on a licensee to process or fulfill the orders. Read more…
In a surprising move, Amazon did a volte face a while back: instead of fighting collecting sales taxes, which was creating an image problem, the online retailer decided to collect taxes and move its previously isolated warehousing closer to metropolitan areas. So, in 2014, Amazon will open a mammoth fulfillment center (one million sq.ft.) in New Jersey as a staging ground for fulfilling orders both to the Garden State and NYC.
Will anyone in NYC who orders books, breakfast cereal, or basketballs from Amazon care that they first touched down in New Jersey? No, it makes no difference. Would New York authorities prohibit those products from being delivered to NY residents? No, they would have no cause to discriminate against those products that started the last leg of their journey to consumers in NJ; Amazon surveyed the competitive landscape and chose to build its warehouse in Jersey.
The New York Post had a story yesterday about a scary bill that has reappeared in Albany that has parallels for wine enthusiasts to the amazon warehouse. The story reports that Empire Merchants LLC, a large wine and spirits distributor, is trying to grease the wheels to pass a state law mandating that all wine delivered to NYC must stay “at rest” in an NY warehouse for 24 hours prior to delivery.
Clearly, this is absurd, and it serves no-one’s purpose other than a large distributor such as Empire. As with Amazon, most of the small and mid-sized wine distributors have chosen to warehouse in New Jersey. To force that warehousing to NY would create jobs–always appealing to politicians–but it would doubtless raise the cost of business to the small and mid-sized distributors, likely raising prices for consumers or forcing distributors to trim their portfolios. The worst case scenario is that they would go out of business. Ironically, the 2005 Granholm decision on direct wine shipping could be invoked since this law discriminates against out-of-state products, violating interstate commerce.
New York City is currently the greatest wine city on the planet. And it’s not the big distributors who make it that way. So go make some noise, write your state senator (here’s text from last year) and tell them you are opposed to S3849-2013, known as “at rest.” The bill’s sponsor is Senator Jeff Klein who, the Post points out, received $33,000 in contributions from Empire over the past four years.
Related: “Wine company ‘buys’ NY bill – that could cost you $7 a bottle!” NY Post
“Put “at rest” to rest in NY” DrVino.com
Thanks for the interest and comments in our survey results posted last week. I was on a family vacation so having those preloaded provided me a brief respite–especially when I discovered I inadvertently left my laptop at home!
Channeling my inner Nate Silver, the results of the survey were pretty interesting, so I thought I’d provide a bit more detail. The 29 participants were asked to name the top five most influential people in the NYC wine world today as they see it from their perch (the email stated that the top five could include people living or dead or who resided outside of NYC as long as their influence today was strong). Measuring influence is an amorphous thing so I asked them to define it as they saw fit from their perch, whether that was moving cases or shaping minds, or a bit of both. The reason I asked for the top five was to make respondents focus on submitting five names of people who really matter. Here were the top five, again: Read more…