3 Flashcards

Question

type of producer- Define Grower-Producers – what are the disadvantages?

Answer 1

**-smaller profit than finished wine** -**lose control of style of finished** **-merchant choose length & type of maturation and has opportunity to blend different producers**

Answer 2

**Traditional role- Negociant, buy immature wine, mature it and sell it** -often blend wines from different prior to bottling **-Burgundy’s micro-négociants** who specialize in small production wines can offer supper premium wines - **Grower merchant that own vineyards & produce wine alongside buying grapes** - advantage produce a range of wines at all price points **=keep the best fruit for own wine production**

Answer 3

**-little control over the grapes growing or winemaking process** -many provide technical support to their suppliers to ensure they are buying what quality required

Answer 4

**-working with many growers means protection & flexibility in bad vintage years – turn to spot market** - can either buy with or without contracts - there is protection against price fluctuations with long term contract w/ supplier to who they provide tec support/ advise - don’t have costs of buying /managing a vineyard - common in Burgundy and Champagne -high price of land

Answer 5

**-wine futures** - method of **selling wine before it has been bottled** - purchaser will receive wine at a later date, could be few years - wine (when bought) is still in barrel & remains in producer’s cellars until bottling and ready to drink

Answer 6

- most closely related **associated w/ Bordeaux** - **WWII when chateaux struggle to survive financially** - **long term mature** before able to sell -**tied up cash** - to **sell wine in barrel = generate cash flow** earlier than wait to sell -**covers the production costs to include bottling** - purchaser cheaper/ easier - more expensive after ageing but not guaranteed. - limited amount could cause price increase - also seen in Burgundy, Rhone, Super Tuscans, and Vintage Ports

Answer 7

- **owned by a group of growers and produce** and sell wine made from grapes grown by members. - benefit: **pool financial resources, afford more expensive equipment & expertise than could afford working individually** - members may also choose to access expert vinicultural & winemaking services to advise - Advise may also include topics of marketing, packaging, sales - some have created own marketed wine brands - produce large volumes of entry level wine or own label

Answer 8

- **owned by members & many have democratic control** - consult member before major decisions are made - could be slow process to agree on course of action

Answer 9

1. **Membership usually is paid a share of annual profit** ## Footnote - Spain & Italy common -member role to produce wine and wait for someone to buy it, get paid on weight - small producer that may or may not be focused on quality 2. **quality focused membership, invest some profits into technology, research, marketing, labeling** - dynamic wine producing business

Answer 10

-Variant on the co-operative model found in North Am. (mostly in CA) **-Winery facility to produce wine for growers for a fee** - Super-premium, small batch to inexpensive, large production - no down sides with co-operatives - grower doesn't need to invest in expensive equip, focus growing - get to benefit from professional winemaker - finished wine is returned to grower who can market it however

Answer 11

-\_\_\_\_ have been **successful in wine regions w/ a number of small volume wine producers** ## Footnote **-need to have clear understanding between grower and facility to ensure produce wine that grower intended.**

Answer 12

Used mainly in **North America -buy in grapes or juice and may rent facilities in another winery or employ the services of a custom crush facility** **Winemakers that do not own vineyard land or wine making facilities** - vary in scale small batch of super premium to high quality wine to organization which create a brand of wine - sourcing fruit or juice from large number of sources

Answer 13

- **very large companies** -interests across all alcoholic products - **often own many smaller businesses** across various stages of the supply chain producers (estate winery, merchant) to distribution - regional offices in markets important to sell their wines grater control and reduce intermediaries -increasing trend - size & influence have significant negotiating power - number of insurance cost has been investing in vineyards portfolio

Answer 14

Co % world production 1. E & J Gallo, USA 2.7% 2. Constellation Brands, USA 1.7% 3. The Wine Group, USA 1.5% 4. Treasury Wine Estate, Australia 1.12% 5. Viña Concha y Toro, Chile 1.03% 6. Castel Frères, France 1.02% 7. Accolade Wines, Australia 0.97% 8. Pernod Ricard, France 0.97% 9. Grupo Peñaflor, Argentina 0.9% 10. FeCoVitA, Argentina 0.7%

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