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NorCal Wine Blog

A Good Winery is Closing, Another Gets Back to Basics

There are roughly 3,400 bonded wineries in California. The vast majority of those are small businesses and family-run. Operating a winery is rarely a tremendously profitable venture. It is even harder to succeed now, given this economy. Consumers are spending less. Banks are lending less.

The winery business is very capital intensive, yet also low-margin. There’s usually at least a two-year gap from the outlay of cash for grapes and barrels to the release and sale of a red wine. That means you’re always two years from getting paid for one vintage and one year out on another while trying to sell bottled inventory from yet a different vintage. Those sales don't happen overnight. In the meantime, all the bills need to be paid.

For most small wineries, direct sales are the best shot at profitability because fewer middlemen means higher margins. But how do you get people in the door or to an online store? Advertising is expensive. Reviews are helpful, but not something to be relied upon. Social media has helped many wineries. But, once everyone is using social media, it’s no longer an advantage but just one more thing you must do to avoid losing ground.

Recently, Ortman Family Wines announced that their wine business, including the downtown Paso Robles tasting room are ceasing operations as of December 23. I profiled Ortman Wines here a few months ago. In their announcement regarding the closure, Matt and Lisa Ortman were frank, “We are unable to meet the demands of our lender during these tough economic times, and the lender has chosen to call in the loan and liquidate the assets.” The Ortmans worked very hard and made some really good wines. They just couldn’t generate enough revenue to cover the expenses that had mounted up. And, not only have they lost their investment, they are also out of work. If you’d like to buy some of their final vintage, it’s still available at the tasting room and the online store.

Much better news, though still highlighting the issues facing small, family businesses, Emtu Estate Wines is going to re-focus on their original business model. I covered John and Chris Mason’s small Forestville winery in one of NorCalWine’s first articles. At the time, their wines were sold almost exclusively in person during tastings at their backyard picnic table. The wines, in particular the Pinot Noir, are quite good. So, Emtu also sold to handful of fine restaurants and shops.

John_Mason_in_the_vineyardAs the winery built momentum, they were encouraged to do more outbound promotion, become active in social media, etc. That’s really hard for a two-person operation to maintain, along with an estate vineyard, winemaking and business operations. Especially when those two people also put a huge focus on charitable work which takes them out of the country for months at a time to places such as Haiti and Kyrgyzstan. And Russian hackers shut down your website with malware. And you need to take time off for surgery to donate a kidney to your sister. Seriously.

So, the Mason's are going back to their old way of selling. John puts it simply "one of [my] goals is to meet everyone who drinks our wine. Well that is what we want to do, to share wine with a small group of people who we can call friends." I asked their permission to share that opportunity with you. It's something I have enjoyed.

Gone are the multiple tiers of pricing necessitated by “the channel.” Gone too are wine pouring junkets. It’s back to personal selling, word-of-mouth, friends and friends of friends. In the short term, with the website down and holidays happening, the best way to get Emtu Pinot Noir is by This email address is being protected from spambots. You need JavaScript enabled to view it. . Emtu Estate Wines have a little bit of 2006 and 2007 available, plus about 80 cases of the current 2008 vintage. The latter is going fast.

The pricing is easy to remember. Before the holidays, buy a case or more and your price is just $20 per bottle plus shipping (but no tax). Make that about 79 cases of 2008. I just sent an email.

Follow NorCalWine on Twitter for breaking wine news, information on events and more. Become a fan and join the NorCal Wine community on FacebookAlso check out our comprehensive Northern California winery listings. They are very useful for planning a tasting trip or just getting in touch with a winery.

This article is original to NorCalWine.com. Copyright 2011 NorCal Wine. Photo of John Mason in the Emtu Estate vineyard courtesy of the winery. All rights reserved.

Comments   

 
Mitch Bakich
#1 Mitch Bakich 2011-12-07 19:29
It's upsetting to see that Ortman Family is having to close their doors due to the economic climate. With the amount of "flash and hype" type wineries out there, losing a producer who was genuine and authentic is very sad and a blow to the industry.
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Ron Rawlinson
#2 Ron Rawlinson 2011-12-08 02:43
As the now former NSM for Ortman, it truly is sad. Chuck Ortman is a CA wine industry icon and Matt was taking over the reins making better and better wines, while Lisa made sure that everyone got great service and was having a good time. Teresa runs the TR like the pro that she is and the wines were getting a lot of traction across the country. Too bad all that wasn't enough.
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