tag:blogger.com,1999:blog-941731830705031230.post4394150220619868213..comments2024-03-25T02:53:48.654-07:00Comments on SVB on Wine: Part I: The Long Term Future of US Wine SalesRob McMillan rmcmillan@svb.comhttp://www.blogger.com/profile/12396624790174552807noreply@blogger.comBlogger14125tag:blogger.com,1999:blog-941731830705031230.post-5614649461034372002012-10-11T19:13:14.737-07:002012-10-11T19:13:14.737-07:00We would gladly send you back the Dodgers, and you...We would gladly send you back the Dodgers, and you can keep the Mets. Go Giants!Suzann Russellnoreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-77569059385229849802012-10-11T16:51:21.520-07:002012-10-11T16:51:21.520-07:00Hey if your sick of the Dodgers, send them back! Y...Hey if your sick of the Dodgers, send them back! You can have the Mets now.McSnobbelierhttps://www.blogger.com/profile/13820928126030348910noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-51658119523248159042012-10-01T19:38:22.676-07:002012-10-01T19:38:22.676-07:00Thanks for contributing Nick. Thats a good and val...Thanks for contributing Nick. Thats a good and valid observation. California is an expensive state in which to live, has the highest State tax rate, and who wants to live in the smog and density in LA with the Dodgers? Not many since that MSA leads CA in the exodus. I don't quite know how to vailidate the conclusion though. If people have a hard time living here financially, they move leaving arguably thte more wealthy people who are better able to afford the wine produced here.<br /><br />That is by no means a happy conclusion. I suspect with the growth in the internet, wealthy people will more and more be able to work outside of the state ... maybe Nevada and pay no tax at all. Fiscally speaking, its a conundrum without question.Rob McMillan rmcmillan@svb.comhttps://www.blogger.com/profile/12396624790174552807noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-43832170963110566742012-10-01T17:11:59.883-07:002012-10-01T17:11:59.883-07:00I've been sharing links to the recent report f...I've been sharing links to the recent report from the Manhattan Institute about California's fiscal, demographic, population, and economic deterioration. I've noted in prior research that the popularity of CA wine is higher nowhere than in CA itself. <br /><br />Therefore, is it possible that using national stats in understanding demographic trends may result in understating the risks to CA producers as CA sheds productive citizens to neighboring states (at a decent clip)? http://www.manhattan-institute.org/html/cr_71.htm<br /><br />The gap between CA unemployment vs. national unemployment alone is material and probably has some effect. If things deteriorate worse in CA wine's best market, maybe we just have to start advertising in TX more?Nick Pnoreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-6284451298813887082012-10-01T13:00:10.593-07:002012-10-01T13:00:10.593-07:00Thanks for keeping me honest Rich. The forecast wa...Thanks for keeping me honest Rich. The forecast was for the fine wine side of the business since that is our main focus. We describe that as wines selling over $20 a bottle because we have several databases from which we can draw that information at that price. I haven't checked since May but last I checked, that segment was showing about 10% growth and the growth rate was dropping. I expect we will finish within that range.Rob McMillan rmcmillan@svb.comhttps://www.blogger.com/profile/12396624790174552807noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-50238788570115105292012-10-01T12:54:57.377-07:002012-10-01T12:54:57.377-07:00Sometime around March 2012 you forecast the U.S. W...Sometime around March 2012 you forecast the U.S. Wine consumption for 2012 would exceed 2011 by somewhere between 7 and 11 percent. Now that we are three-quarters of the way through 2012, how far off from that prognosis is the U.S. wine market?Rich Readerhttp://www.vinebuzz.biznoreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-79269005888229265122012-10-01T12:32:40.478-07:002012-10-01T12:32:40.478-07:00Thanks Chrissa
Price/Quality is what consumers loo...Thanks Chrissa<br />Price/Quality is what consumers look for (value). Small very high-end producers will continue to do well because there will alwauys be someone willing to pay a high price for a limited bottling. But I do agree, its hard to see how a higher production wine can attract a $45 price in the present revovering economic conditions.Rob McMillan rmcmillan@svb.comhttps://www.blogger.com/profile/12396624790174552807noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-40675312047952759182012-10-01T12:23:46.637-07:002012-10-01T12:23:46.637-07:00I know several producers in California that contin...I know several producers in California that continue to raise their prices incrementally each year. What used to be a wonderful bottle of wine for $28 btl is now retailing at $40-45. When I asked how they can continue to do that in a down economy the overall response is, "I'm not worried about it, they'll buy it in China". I myself have shifted my buying habits to different varietals like Ribolla and Cab Franc. I simply think a $45 price tag is insane for something whose quality is consistent rather than noteworthy.Chrissa Chasehttp://traipsingaroundterrior.comnoreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-74068360168944573422012-10-01T12:19:09.334-07:002012-10-01T12:19:09.334-07:00Thanks for weighing in Mark. It would be great as ...Thanks for weighing in Mark. It would be great as an industry if we could actually quantify 'premium, super-premium, mid-premium' etc. It would lead to more complete discussions but - I doubt we see that happen.<br /><br />I agree foreign sources - bottled and bulk - will change the dynamic of the business. Its a little harder for today with the world wide balance/shortages that are beginning to emerge. Argentina which I just came back from last Monday has one of the larger supplies and man can they produce beautiful wines. But their Government is so fickle in their decision making it makes it hard to predict anything for them. That said, there is a need and the large wine producers here are bringing out the wines and filling their domestic brands.<br /><br />Next week in Part II of this two part series, I'll discuss some of the wine specific changes I expect, given these observations. Rob McMillan rmcmillan@svb.comhttps://www.blogger.com/profile/12396624790174552807noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-87929524475172978952012-10-01T12:06:46.624-07:002012-10-01T12:06:46.624-07:00I agree with Anonymous. You can already see Austra...I agree with Anonymous. You can already see Australia and Argentina Bulking out much of their grapes that can't be sold at the high prices they used to command. I think that value wines will increase in volume with wineries going farther a field in sourcing. Perhaps you will even see Australian Juice in the American market and sold under, who knows what designation. There is a shortage of grapes, but there is also a shortage of buyers in the mid-premium line, i.e. $35 to $60. Unless you are an established brand with a reputation, I believe many will struggle and have to be willing to either lower their price or cut production.Mark Buckleyhttps://www.blogger.com/profile/09064352575409422346noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-70963116907217066472012-10-01T11:37:00.442-07:002012-10-01T11:37:00.442-07:00Interesting perspective .... perhaps. Why do you b...Interesting perspective .... perhaps. Why do you believe that? Where will those grapes come from?Rob McMillan rmcmillan@svb.comhttps://www.blogger.com/profile/12396624790174552807noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-42922261540658306962012-10-01T11:34:24.258-07:002012-10-01T11:34:24.258-07:00From the supply side of the equation, I see the th...From the supply side of the equation, I see the the US winery business model adapting to support a higher volume/lower price wine. Think less "Chateau's" and more custom crush production methods, ala Cameron Hughes business model, etc. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-32189035452186745162012-10-01T10:56:55.665-07:002012-10-01T10:56:55.665-07:00The clown with a knife syndrome in action. The goo...The clown with a knife syndrome in action. The good news in an alternate future view is that the US$ can depreciate more than the major wine producing regions making US wine competitive here and in the growing export countries..... then again, that will raise the costs of all our imports and drive inflation up. There is no perfect outcome that I can see, but optimistically I do believe we as an industry will fare better than most in the US.Rob McMillan rmcmillan@svb.comhttps://www.blogger.com/profile/12396624790174552807noreply@blogger.comtag:blogger.com,1999:blog-941731830705031230.post-40545947969933021682012-10-01T10:25:50.273-07:002012-10-01T10:25:50.273-07:00I'm not sure whether to laugh or cry. So, I th...I'm not sure whether to laugh or cry. So, I think I'll go home and have a glass of wine.Anonymousnoreply@blogger.com