The Business Press: Inland wineries continue growth trend

By Chris H. Sieroty 

Contributing Writer

Whether or not there is high demand for vintners’ products locally from retail outlets, the wine business in Inland Southern California has been growing rapidly over the past 10 years. Most of the local wines are produced in Temecula, but there are three major wineries — Joseph Filippi Winery and Vineyards, The Wine Tailor, and the Brandt Family Winery — located in San Bernardino County that are trying to capture a piece of a crowded market. A new winery, The Wine Down, opened in February in Chino Hills.

Of the 25 largest wineries located in the two-county region, 22 of them are located in Temecula, according to a list of wineries compiled by The Business Press. There are a total of 38 wineries in Temecula, according to the Temecula Valley Winegrowers Association (TVWA), a nonprofit organization that promotes the region’s wine industry.

“When I started here 20 years ago there were eight wineries in the area,” said Peggy Evans, TVWA’s interim executive director. “We have grown gradually over the years, but in the last five years we added 15 new wineries.”

She said local wineries are still attracting thousands of visitors during the recession, but those visitors are buying fewer bottles of wine on each visit. In 2008, the 22 largest wineries in southern Riverside County generated almost $48 million in revenue. Despite their relatively small size, wineries in San Bernardino County generated more than $4 million in revenue last year.

Ken Lineberger, owner of The Wine Tailor in Rancho Cucamonga, said 95 percent of the 5,000 cases produced annually are sold through his winery.

“We only distribute a few cases to local stores and restaurants,” Lineberger said. “Most of our business is generated through tour groups that visit our winery, our wine club and from sales that are generated through the distribution of our newsletter. Our market is the wine buyer in Rancho Cucamonga, Claremont, Upland, La Verne and Ontario.”

The Wine Tailor’s wine club, which began in 2006, has grown to 500 members and the monthly newsletter currently has 7,500 subscribers. He said along with offering tastings, his winery has created a niche among local wine buyers by offering them the opportunity to create their own vintages or purchase wines with their own custom labels.

“We let customers choose the wine they want and create their own label while they wait,” he said. “The wine costs between $12 to $20 a bottle plus $1 or $2 for the label. It’s been very successful, with the winery creating 10 cases or more per day. We also let guests make their own personal vintages. It starts by letting them sprinkle the yeast into the wine and then they come back in five to seven weeks and bottle it.”

Lineberger said the winery has created more than 1,500 personal vintages, which depending on the wine a customer chooses can cost between $140 for a half-batch, or 12 bottles, and more than $300 for a full batch, or 29 bottles.

Being located in San Bernardino County hasn’t hurt his business. Lineberger said The Wine Tailor generated $2 million in revenue last year.

“We are operating at 90 percent of capacity,” he said. “I would love to be able to distribute our wines through Pacific Wine Merchants, but we just don’t have the capacity to produce enough wine to increase our distribution to local shops and restaurants. We are actively looking for a larger facility in the area. We hope to make an announcement soon.”

Whether it’s in the Inland Empire or Napa Valley, the wine industry continues to be big business even in a recession, according to a survey recently released by the San Francisco-based Wine Institute. The survey found that 2008 California wines sales to the U.S. market edged up 2 percent in volume over the previous year to an estimated 467 million gallons (196.3 million 9-liter cases). The estimated retail value of these shipments totaled approximately $18.5 billion, down slightly from 2007.

“Consumers are enjoying California wines during these challenging economic times,” said Robert P. Koch, president and CEO of the Wine Institute, in a statement.

Koch added that the Wine Institute is currently lobbying against proposed tax and fee increases on wine nationwide at a time the industry is trying to preserve 875,000 wine-related jobs in the U.S., 309,000 of which are located in California.


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