The Auswine Forum

A winemaker makes a wine, sells it to an exporter/importer who sells it on to a distributor who then sells it to a retailer who then offers you the wine at a competitive price. Or so the theory goes. But in reality many things influence the competitive pricing of wine. One of these is the inability to sell the wine for its recommended retail price, a not uncommon event in the USA with Aussie Shiraz these days. Another is when an importer/exporter is revising their portfolio. Combine the two and you get a fire sale.

Such seems to be the case with wines under The Grateful Palate umbrella. The Grateful Palate has recently reduced its portfolio to about 25 producers from a high of 70 a few years ago. Its not clear whether producers have been dropped or have left Grateful Palate but the result has been deep discounts on Australian wines. Take, for example the deals I was offered today. McLean’s Farm 2002 Shiraz (Barossa Valley) which sells retail (according to Wine Searcher) for $23.99 to $29.99USD, but offered to me for $8.99. Or the 2004 Gibson Old Vine Collection Barossa Valley Shiraz, $99.99USD retail on Wine Searcher, but I was able to purchase it for $44.99. The most recent vintage sells for $96AUD mail order from Gibson’s.

Some say that Australian wines in the US need to drop their prices to more reasonable levels after the big increases that have followed with the extravagance of high Parker points. This may be true, but there is another story that may be building behind this and it is that importers/exporters, distributors, and retailers are seeing significant losses in profits with the selling of Australian wines. When you lose money you tend not to want to expose yourself to the same position again. And so when a major importer/exporter has a fire sale on Aussie wines the question that needs to be answered is whether others want to build their portfolio of Australian wines when they see others having problems selling the wines unless they have dramatic reductions in their prices?

Mike

It's a pity that the greed of a few (and that includes some producers as well as importers/distributors) has led to this situation in the USA.

Combined with the current financial meltdown I guess there will be a lot of bargains for those who like good Aus wines and still have the money to take advantage of the situation. I'd love to be able to get the Gibson AOVC Shiraz 2004 for $44.99.

The current fall-back of the AUD will help a bit, but who knows how long it will stay this low?

Tough times for some of those that rely heavily on the US market, less of a problem for those with a more widespread market. Or maybe they can team up with Sparky & Sarah Marquis who now have their own import/distribution company, having learned the hard way about dealing with the greedy ones.

I have a long-held theory that good wines fairly priced for the quality will always sell (and at a profit). The "market" will decide whose wines are good enough and fairly priced, apart from those who have achieved lasting "cult" status, where anything goes. The caveat is that once a reputation is lost or prices increased too much and not reduced quickly enough, it may be too late when they are. Examples being Classic McLaren (defunct) and Viking (selling for less than half what was being asked a couple of years ago).

Unfortunately it is not just in the US. I am an Aust. wine importer to Singapore and see a lot of importers are putting so much fat margins...it is just unbelievable! Esp. those got high Parker poniters.
eg. torbreck steading selling price here is not far off on st. henri On top of this, big supermarket chains want A&P funds, listing fees...these can mount up to S$10k easily by the time trying to put 5 labels. All these are passed it onto the consumers!

Hey Brian, I noticed that you jumped on the $20 Viking Grand Shiraz 06 too! I'm expecting delivery of a case of the Nashwauk cleanskin shiraz this week

Cheers

daz

Daryl Douglas wrote:Hey Brian, I noticed that you jumped on the $20 Viking Grand Shiraz 06 too! I'm expecting delivery of a case of the Nashwauk cleanskin shiraz this week

Cheers

daz

Yeah, I like the Viking Grand Shiraz and have most vintages back to 2001. The 2006 is a very good wine for the price. Hope you enjoy the Nashwauk too.

Red Bigot wrote:

Daryl Douglas wrote:Hey Brian, I noticed that you jumped on the $20 Viking Grand Shiraz 06 too! I'm expecting delivery of a case of the Nashwauk cleanskin shiraz this week

Cheers

daz

Yeah, I like the Viking Grand Shiraz and have most vintages back to 2001. The 2006 is a very good wine for the price. Hope you enjoy the Nashwauk too.

Can't hep but wonder whether the Nashwauk offshoot of Kaesler had an export order cancelled, hence the cleanskin. I'm a bit of a fan of Stonehorse 05 but that's Barossan.

The last McLarenvale Vale wine I've had that impressed was Wolf Blass Grey Label Shiraz 04. Still have a couple of the bottles of it that I got for about $20. Not that it'd interest you but Ingoldby Chard 06 isn't a bad drop for the price either.

Cheers

Hey Dazza

Hows that Nashwauk shiraz 2006 performing?

Wondering whether to invest in a case as Red Bigot indicates theres still some available!

Cheers

Ronaldo

In the US its fashionable to bash Aussie wines. So fashionable that many retailers have discounted existing stocks heavily and don't plan on getting in the new vintages. My local bottlo now carries 4 Aussie labels, when 4 years ago he carried 50+. And he's not Robinson Crusoe...

Maroon&Blue wrote:Hey Dazza

Hows that Nashwauk shiraz 2006 performing?

Wondering whether to invest in a case as Red Bigot indicates theres still some available!

Cheers

Ronaldo

Already all gone - I usually drink the cheaper wines first. It's a big wine in body and alc with some warmth on the finish though not excessive - needs a good hour in the glass for the fruit to really come to the fore. It's a bit like a Seaview shiraz (of days past) on steroids, perhaps 89+/100 for me. At about $10.50/btl delivered it's very good value and I quite enjoyed it.

I'd get some more but I've already asked Judy Press to hold a couple of cases of Mike's cab 07 for me until I return from a couple of weeks holiday. I've already started on the third case of the cab 06 that arrived on Monday - it's become my favourite quaffer, very easy-drinking, very enjoyable, not quite full-bodied, varietal, some vanillin oak adding to the sweetish fruit. The finish has satisfying length with a touch of savouriness. I'd recommend it over the Nashwauk cleanskin.

Judy's asked me give my opinion of a comparison of the two vintages when I get the 07. That won't be for about a month - this time next week I'll be visiting friends in the country outside of Ipswich for her 50th b'day (have a bottle of BoF Arras 2001 for her - she likes Taltarni Brut) celebration on Saturday week then a couple of days or so later, spending about a week visiting other friends in Brisbane.

Cheers

daz

I think that it's more than just "greed" that accounts for the decline in sales of Australian premium wines. Sure there are many wines that are way overpriced but thats because its what the market will bear. However, things are changing.

Collectors like to believe that their high-priced wines will cellar. When they discover that many of the high alcohol "fruit bombs" from Australia don't last a few years in the cellar they start to turn to wines from other countries. I've seen that with some of my collector friends who have shifted their dollars to old world wines. At a local specialty wine store I was told that very little Australian wines were sold during the Thanksgiving period.

It is this shift in the premium wine market that accounts for the decline in sales. The next problem is that if the premium buyers, collectors and critics (and then the sales staff) move away from Australian wine then how long before the sentiment starts to filter to the general public?

Personally, I still think that a lot of premium quality wines are over-priced wherever they may come from but there are people willing to pay for them. I also think that there are many Australian wines that will cellar very well (the last bottle of '90 Eileen Hardy Shiraz that I drank last month was delightful). Hence, however critical I am of the over-extracted style of some Australian wines, I continue to put the better examples in my cellar.

Cheers..............Mahmoud.

Another part of the problem is that Australian wines are normally considered to be 'one region'. Badmarketing in hindsight. It doesn't help that Barossa and McLaren Vale wineries comprise about 90% of the wines available in many overseas markets. But when the 'typical' Australian wines lose their trendy status, ALL Australian wines suffer. The cheap versions are stil doing OK, but the $30+ wines seem to be in a freefall. My monopoly system hasn't really discounted a lot of wines yet, but Ozzie wines are sitting on the shelves for a LONG time now, where once they were snapped up almost immediately (e.g., Mollydooker, Two Hands, Greenock Creek, Penfolds, etc).

While I agree the greed of distributors and importers is a big issue, the wineries often went along with big price increases due to the lofty Parker scores - the chickens are coming home to roost now...