Early Results / Last Chance: SVB Survey Closes Sunday Night

This year will be remembered as the year when we actually discovered the answer to the question: "What else can go wrong?" 

I can safely speak for humanity and say that nobody wants to repeat this year. There is so much we had no control over, and what we experienced wasn't always the result of our action or inaction. Still ... here we are; moving into 2021 with increasing and record numbers of  COVID cases in the US and more solutions needed for the pandemic and for our wine business. We clearly need to look for more solutions to our problems.

But I have no doubt we will survive and rebound as an industry - maybe even thrive if we make some adaptations that I will discuss again in the Annual State of the Industry Report. But all of that starts by understanding where we are. That is the beginning point. For me, understanding the business starts with the Annual Winery Conditions Survey. 

    Last Chance

The 2020 Wine Industry Survey will close Sunday night, and as of this moment we have almost 550 wineries responding versus our typical 800. For us to understand and get to the beginning point we need good tesponse rates. With weaker response rates, your 15 minutes investment in the survey has never been more critical. 

For you that have yet to respond, there is still time. We will leave the survey open until late Sunday night. Here is a link to the questions in PDF, QUESTIONS, and here is a link to the actual survey, SURVEY. 

If you are curious, here is what the regional participation looks like weighted by the number of wineries in the given region

(Click To Enlarge)

Special thanks to all the AVA's for participating and sending out encouragement to their constituents to participate. In particular, Washington, Oregon and Paso Robles each sent stand-alone emails from their Executive Directors in the past 36 hours and the numbers in those regions have come up. I've seen some movement from other areas particularly in San Luis Obispo, Napa, Sonoma, and Santa Barbara but don't always see what's happening in the background.

Thank you all for your efforts in this partnership without which, there can be no SVB State of the Industry Report - so thank you!!

What is the Industry Reporting for 2020 Results? The SVB Survey Has Early Returns [Still Open]

While the unprecedented impacts of the Pandemic and wildfires have rightfully absorbed the attention of the media and industry participants, the basic marketplace challenges I've reported in the 2020 State of the Industry Report are still alive and confronting the industry.

Data and information has never been more important than today. Changes to consumer behavior emanating from shelter in place orders, a recession, and the ruination of restaurants in America among other factors, are creating new changes for wineries, and yes - new opportunities as well if you listen and plan.

The Twentieth Silicon Valley Bank Winery Conditions Survey presents a view of business conditions sorted by region, average bottle price, time in business, and other filters, all to give participants an accurate read of the current industry, and all gratis to participants. The Survey is drawing to a close next week. If you haven't yet participated in this study, I encourage you to do so. Only participants get the complete set of anonymized data and analysis back, at no cost to participants for an investment of 15 minutes of your time. 

PLEASE - will you personally support the wine industry by committing to participate this year? 

Here is a link to a PDF file of the questions to prepare, and here is a link to the survey itself.

OPEN: SVB Annual State of the Industry Survey

Spring, Summer, Fall, Planning 

Winter is a time for planning - and do we ever need to plan! But where do we start? 

Are we oversupplied still? Do we even know if wine sales are higher or lower? How should we position next year when we put our business plans together? Should we forecast for higher or lower sales? What do we know now? 

BW166 has concluded wine volume entering the wholesale channel is up 4% as of August 2020. SipSource, a database using wholesale depletions has wine volume combining both on and off premise down 1.3% year over year though June. Wines & Vines Analytics concluded that Direct Shipments through June were 29% higher in volume. 

Where is the consumer in all of this? What is driving demand? Are we up or down? The reality is - the future is not yet clear, but I hope to change that. 

The Real Threat to Wine Sales is Being Ignored

 

While we've been fighting the Pandemic, another public policy battle surrounding health has been quietly fought in the shadows, the goal of which is to reduce or eliminate wine consumption by painting it as cancerous and unhealthy. This battle has been going on for a very long time, but the wine business hasn't responded or pushed back on the subject for 20 years.

You Are at the Bottom and Looking for Inspiration

Inspiration is the substance of undiscovered strategies. It can come from almost anywhere if we stay positive and are open to it, but it's the fuel that ignites change.

This pandemic has put many people in the wine, travel, restaurant, and hospitality business on their heals or flat on their backs. 

Being in the cruise business might come to mind as being the worst place to be today, but at least cruise lines can raise money to survive. 

Perhaps the most difficult job today is owning a small travel agency as does my friend Michael Mastrocola at MillenniuM Travel, who many will know because he arranges annual cruises for a host of wineries. 

Signup: SVB State of the Industry - Special Edition

  

On March 23rd, eight days after we closed tasting rooms in California, I posted a blog about crisis management where I suggested for scenario planning, June 1st would be a good guess for reopening. So I was really excited to hear that this past week that we've started the conversation about reopening tasting rooms in California and along the west coast. Perhaps my educated guess might turn out closer to correct than I deserve?

Post Lock-Down Opportunity for Wineries

The above chart from the USDA is a little cluttered, but the dotted lines show how US consumers have been moving from eating at home, and somewhere around 2011 shifted to eating away from home. Not earth-shattering observations that two-income families with complex schedules moved away from traditional family meals. But why should we care? We should care because an interesting thing has happened with wine demand in the last 7 weeks.