Wine Business in 2009

Recession, credit crunch, global economic meltdown, sliding economies, negative growth, rising unemployment, job losses, plunging stock markets, closing businesses…………words that are reflective of the current economic climate. Nowadays it is almost impossible not to come across at least one of these (dreaded) words in your daily newspaper or news bulletins.

So what has been the impact of this economic downturn on the wine industry so far? Have you already noticed substantial turnarounds in your respective markets or expecting the same in coming months? What do you think wine businesses can do differently that will help them sail through this turmoil? How do you see the market dynamics shaping up in 2009? These are some of the questions that I raised in one of the discussions on LinkedIn a while ago with an aim to get some expert opinion on this raging but very relevant issue.

The replies I’ve posted below came from individuals representing three different sectors within the wine industry but are quite unique in their own ways. They also somehow reflect the diversity within the industry vis-à-vis their perception of the current economic situation.

A winery owner/Winemaker:

“I think we’re looking at a fairly flat 2009. You’ll see a lot more producers forming alliances with others in an effort to weather the storm…and you’ll see a lot of smaller producers selling out or closing their doors. The ones who have the cash reserves to stay in it will be forced to re-think/re-tool their product mix and distribution schemes.
Similar changes in the wholesale market will occur, and in some markets this will continue the trend of blowing out inventories at crazy low prices…resulting in an even more painful pinch placed on the small, artisan producer. The old saw of “worry about the cases and the money will follow” adage no longer applies.

The lack of cash will continue to stress all tiers of the business. On the producer/wholesale side, this will force leaner operations, and may put plans to expand/modernize on hold. It will also continue a ‘trickle up’ problem of cash flow…accounts not paying wholesalers in a timely manner will stress a wholesaler’s ability to pay suppliers. The folks who will ride this out will have (or at least have access to) cash reserves.

We’re at least a year away from a turnaround. I hope I’m wrong, but – from what I’ve seen around the U.S. and abroad – it looks likely.”

An independent wine consultant:

“In my business, I haven’t really noticed any impact. My business is a bit different in the wine industry though. I don’t have a wine store, so there isn’t the overhead that stores and restaurants would have. I don’t have employees, so I don’t also have those expenses.
My business is very client-focused and service-oriented. As an independent consultant working with a Napa Valley winery, we offer private wine tastings, personalized gifts and gift baskets. Being very focused on really getting to know my hosts and their guests, becoming knowledgeable on the wines served at the tasting, being entertaining and helping my host with setting up their tasting, inviting the guests, etc., puts us in a different type of niche. We go to the home or office, they don’t have to come to us. It’s kind of like a housecall for wine. Pretty cool. I expect my business in the next year to flourish and grow.”

A corporate wine manager of a chain of restaurants:

“Consolidation will occur at all three levels of the industry. Smaller family owned wineries will be purchased at a discount, large conglomerates especially from Australia will be forced to sell off pieces. Consolidation will continue at the wholesale level to stay competitive.
Wine consumption won’t wain, but consumption habits will be driven into the privacy of one’s home. Comfort food and comfort wines will be a staple for at least a year. I see wines from Argentina and Chile picking up steam due to quality and price (something the Aussie’s used to have), California cult wines will see a cooling off period at the restaurant level and at auction. French Bordeaux and Champagne continues to back itself into a corner with lack of vision or compassion towards price, however I believe the Rhone and Languedoc have done and continue to reach new consumers for the very reasons Bordeaux fails.
At the restaurants, I’m seeing a downtick in check averages, but not in volume, suggesting that my guests are consuming similiar amounts of wine during the dining experience, but, on lesser priced wines. Critter and cutesy wine labels are falling out of favor as the american consumer becomes more and more savvy in knowledge and tastes, these folks will return to classic, reputable producers with Icon names (hence comfort wines).”

The current crisis will no doubt cast its shadow but only time will tell the magnitude of its effect. History is witness that the wine industry has weathered many storms in the past including wars, diseases, recessions and so on. Let’s hope this time it’s no different.

Cheers,

Niladri

Understanding Wine Descriptors – Part 2

In this post I’ve listed some most common faults that one may come across occasionally in wine literature, although, being faults, they hardly appear in tasting notes. Once again, this is an attempt to present the flaws in as simple language as possible without venturing into the science and technicalities behind them:

• Appley/Sherry like – A common fault that is a result of heavy oxygen contact. Imagine smelling leftover cut apples.
• Cloudy – When wines (mostly whites) appear hazy because they were not properly clarified before bottling.
• Corked/Cork taint - A massive issue that is the basis of the New World efforts to popularize alternative wine closures, especially the screwcap. A musty smell masks all the basic aromas of the wine. Imagine smelling a wet cardboard.
• Brett – Short for Brettanomyces. There are many ways this fault is described based on the level of contamination the meaning of which are pretty self explanatory like horsey (imagine walking into a horse stable), mousy, band-aidy, cheesy, barnyardy etc.
• Buttery - Generally a positive outcome of ‘Malo’ (see previous post) but occasionally higher levels can interfere with varietal flavours.
• Oxidised - A result of extended contact of oxygen with the wine. In appearance, most distinct in white wines which turn brown. Smells appley or sherry like. Heavily oxidised wines will taste flat.
• Slimey – When the wine’s texture is particularly viscous or fatty. Sometimes can also be described as ropiness of the wine.
• Spritzy – Fizziness or effervescence noticed in wines that are expected to be absolutely still. A byproduct of micro-organisms feeding on nutrients in the wine after bottling.
• Sulphur taints - Sulphur acts as a preservative in wines but excess amounts can result in smells of spent matches (fireworks smoke on a Diwali night???). Another sulphur related fault often described as rotten eggs smell.
• Vinegary – Also referred to as VA (volatile acidity). In simple terms it means that the acid components are too obvious on the nose rather than on the palate.

These are the most common descriptors one is likely to encounter although there are numerous other flaws that can be observed in bottled wines which experts often relate to various intricacies of wine science. But the saying “you don’t have to know how an internal combustion engine works to drive a car”, is also applicable when it comes to enjoying wine!

Cheers,

Niladri

Understanding Wine Descriptors – Part 1

In one of my previous posts I discussed about the nature of wine tasting notes that are mostly visible on the web nowadays. Most of them can be encountered on on-line wine forums/communities/tasting groups – a virtual world of wine linguists where anyone who is not accustomed to the language may feel a bit out of place.

If you happen to be one of these rank outsiders, it is worthwhile to get a basic understanding of the most common descriptors that have become almost de rigueur and to a large extent indispensable in modern day wine language.

Following is a list of such words/jargons/phrases that I’ve come across the most. Please note that they are not in any particular sensory order (appearance, nose & palate) but are general words that are most likely to appear in tasting notes. This list does not include the wine faults which I’ll discuss in my next post:

• Astringent – A drying and often unpleasant sensation after swallowing. Mostly used to describe red wines with high tannin. Imagine a very strong black and unsweetened tea!
• Austere – Simply, a wine that is hard to enjoy mostly due to high acidity or lack of fruit characters.
• Autolytic characters – Used to describe Champagne and other sparkling wines made in the ‘traditional’ way. A character achieved by ageing these wines on dead and decomposing yeast cells. Synonymous with ‘yeasty’, ‘biscuity’, ‘briochy’ etc.
• Big – A wine so full and rich in flavour that it seems big in the mouth. Sometimes may also be used to indicate high alcohol and tannic (not harsh but well integrated with flavour components) wines.
• Body – Primarily indicates a combination of fruit, alcohol and sweetness but may also account for other factors.
• Buttery – A creamy, almost butter like sensation observed in oak matured Chardonnays. See Malo characters below.
• Chewy – Used for tannins that are so obvious that they need to be chewed before swallowing.
• Closed – A wine that does not express itself entirely because it hasn’t matured enough.
• Cloying – A negative term that indicates the sweetness of the wine which masks other characters.
• Complex – In wine language, a positive term. Used for wines that demonstrate a balanced and wide range of flavour and aroma components.
• Crisp – White wines that have high levels of but not necessarily unpleasant acidity.
• Dumb – More or less similar to closed but in a more negative sense as they may not express themselves with age.
• Depth – Suggests how long lasting the flavour profiles of a wine are.
• Extract/Extraction – A term used to indicate the overall concentration of colour and flavour as ‘extracted’ from the skins of the grapes.
• Flabby – A wine that lacks the required acidity to make it balanced.
• Finish – Simply, the sensation once the wine is swallowed. A big factor in deciding the quality.
• Firm – A wine which holds itself well with either acidity or tannin.
• Fleshy – A positive term to suggest body and extract.
• Hollow - A wine with initial burst of flavour and a lingering finish but not so obvious in between. Requires a trained palate to observe this.
• Hot - Indicates high alcohol. Heat observed on swallowing.
• Jammy – Red wines with jam like smells. May indicate over-ripe fruits but not necessarily in a negative sense.
• Lean – Somewhat watery. Lacking body and character.
• Legs/Tears – Refers to the droplets that cling to the glass and descend down slowly after swirling. A result of high alcohol or sugar content.
• Length – How long the flavour lingers in the mouth after being swallowed.
• Malo characters - Malo is the short form of ‘Malolactic Fermentation’ which not only softens the wine (of acidity) but also imparts ‘Malo’ characters which, in white wines are generally described as ‘creamy’ and ‘buttery’.
• Minerally - A wine that is perceived to have some distinct qualities that resembles mineral characters. For example, imagine striking two flint stones and smelling it! Top German Rieslings show plenty of minerally characters.
• Powerful – A wine’s ability to pack a punch. In other words how powerful is it in terms of flavours, tannin and alcohol.
• Robust - A wine with plenty of character in terms of body, flavour, length and overall profile.
• Structure – Indicates the overall balance and harmony of all the wine’s components.
• Supple – An easy drinking wine with a smooth texture. Often used to describe the balance of red wines.
• Vinous – A rather ambiguous tasting term. Simply speaking it just suggests a simple wine that just tastes of ‘wine’ (Vin=wine in French) without displaying the complexities of a truly good wine.
• Viscous – Mostly refers to the texture which is not thin. A combination of alcohol, sweetness fruit and oak extract.
• Vegetal/Herbaceous – Can be used in both positive and negative ways. When positive it refers to the distinct grassy/leafy aromas of grape varieties like Sauvignon Blanc. In negative terms it means unripe tannins and fruit flavours in red wines.
• Zesty – Often used to describe the acidity in a wine. Can also sometimes denote the citrus flavour profiles in grapes.

Although there are hundreds of other tasting terms used within the wine community, the list above are the ones that I’ve come across the most and in my view will assist a novice wine drinker in his/her quest to, well simply enjoy wine!

Part 2 on wine faults follows.

Cheers!

Niladri

India Wine Challenge

The India Wine Challenge concluded last month which showcased more than 500 wines from around the world making it by far the most comprehensive wine show in the country.

It was good to notice some positive comments from the judges on the future of the Indian wine industry. The fact that a red wine (Chateau d’Ori Cabernet-Merlot) other than the well known La Reserva (from Grover’s) made it to the top was also encouraging.

I am not surprised to see three Kiwi wines among the trophy winners considering the fact that many wines from this tiny country down under have featured highly in major wine competitions in recent years. I plan to share my thoughts about what makes New Zealand wines so special in one of my future posts.

These are the trophy winners for 2008. For more information on the event, visit the official page.

Cheers,

Niladri

Wine Language – Let’s Keep it Simple

There’s been much debate in the wine world surrounding the effect of modern wine language, both formal and colloquial, on the changing attitudes towards wine appreciation.  Nowhere this evolution is more vivid and evident than the tasting notes posted on various websites and blogs. This article only relates to the tasting notes that I believe are too complicated and are solely aimed at a reasonably highly knowledgeable segment.

But what about a place like India where  wine is still a very rudimentary subject? Naturally the level of technical knowledge is also limited. So, it is only logical to keep things at a level where people feel comfortable talking about it. No wonder there’s been numerous attempts to bring this issue to light. In fact I wrote the following article in response to a blog post which suggested finding new flavour profiles in wines so that people from these places can relate to them.

A time when ‘unconventional’ markets are increasingly embracing the ‘wine culture’, an argument towards a simplified and adaptable wine-tasting regime carries a lot of weight. An approach which recognises that wine is for enjoying and not something to get daunted or overwhelmed about. This is exactly how I felt when I first started taking interest in wine. Although nothing was thrust upon me but I found this scholarly fuss about describing characters of some wines (read: complicated tasting notes) highly intimidating. I probably should have realized that they were not meant for novices!

One reason, and the most important one for that matter, why most wine jargon intrigued me those days is because I came from a society that simply is not used to relating a wide range of flavour profiles (and descriptors in particular) to any beverage. Ask an average Indian about the most ‘complex’ and flavourful beverage he/she ever had, the chances are that the verdict will be split between ‘Masala Chai’ (tea infused with Indian spices) and ‘Bhang’ (a heady concoction of milk, nuts, spices and herbs drunk for euphoria/ecstasy)!!

On a more serious note, the modern day wine language has evolved over time and is a result of lot of research – the Aroma Wheel and Mouth feel Wheel for example. It would be audacious to think that these resources can be easily altered or substituted. The actual flavour profile of a grape variety (and hence the wine) is universal and is most likely to reflect that irrespective of terroir. A ripe Cabernet Sauvignon tastes of Blackcurrants and in my view is the perfect way to describe the grape but can we substitute this with an Indian version of blackcurrant? Well maybe, but so far I’m not aware of anything that is remotely similar. At least tasting a Cab Sauv will tell you what blackcurrant is all about! Always helps to think the glass is half full!

The need of the hour is a basic and simple but systematic approach aimed at these emerging markets. As mentioned, the primary flavour profiles of wines as they are mentioned in wine literature are likely to firmly hold their ground until relevant substitutes are agreed upon. In the meantime, more attention should be diverted towards heavy and technical descriptors like Malo, Rancio, fruit laced Autolytic characters, Hollow mid-palate, Horsey nose, chewy phenolics, toasty oak with leathery undertones etc, that tend to become too overbearing on novice and evolving palates. Clichés and stereotypes may have to be relinquished in favour of practicality and acceptance.

Any volunteers to bell the cat?

Cheers and happy 2009!

Niladri