June 30, 2007
A Blow to Wine SnobsBy Thomas Lifson
It isn't exactly David slaying Goliath, but an equally unexpected victory has stunned the California wine industry. The cheapest wine in California just won top honors in one of the top wine competitions. When the national media catches-up, you will see this news elsewhere.
"Two Buck Chuck" is the nickname for the extremely inexpensive wines sold exclusively in the Trader Joe's chain of grocery stores, which specialize in upscale foods at fairly downscale prices. Produced by Bronco Winery, part of the Franzia family's wine empire, Two Buck Chuck has roiled the domestic wine industry by putting out generally quite decent wines at a price everyone can afford. I have myself been a customer, by the case. Some I have used for cooking, some I have quaffed. I particularly have favored their Chardonnay. To me, a "good wine" is a wine that I enjoy.
But I never expected to read that Charles Shaw has won the California State Fair's Commercial Wine Competition as the best Chardonnay in California. Yet, that has just happened:
How is this possible? Several factors come into play here.
First, California has had a tremendous glut of Chardonnay grapes the past several harvests, with much excellent fruit simply rotting on the vines. Over-planting happened when Chardonnay became quite a fad some years ago, only to see consumers get somewhat tired of it and move on to other more interesting varietals, particularly Sauvignon Blanc and Pinot Grigio. So Charles Shaw was able to get an adequate supply of good Chardonnay grapes at a low price.
Second, way too much Chardonnay on the market has been subjected to too much aging in young oak barrels, imparting an oaky flavor. That was the fad, stoked by certain well-known wine critics. Additionally, too many winemakers have utilized too much malolactic fermentation, producing a buttery flavor. For some reason, this, too, has been quite a fad. I prefer to taste grapes more than oak, and like a cleaner flavor in my white wines. So I have not bought a lot of expensive Chardonnay.
Third, Bronco Winery has done a fantastic job driving the costs out of wine making, using its purchasing leverage to obtain the lowest costs, and operating on a huge scale. And I say, God bless ‘em. They must be awfully smart to be able to pull off this feat.
By comparison, Sunset Cellars, the tiny winery in which I am a partner (and which has won a number of top honors in this same wine competition) pays more than $2 a bottle for glass, corkage, and bottling costs, before we even begin to pay for the wine itself. Of course, we use top quality bottles and corks, and operate at such a small scale that we have no leverage at all on price. Our wines, which are hand-made, retail on average for about 10 times the cost of Two Buck Chuck. We also pay top dollar for the best grapes - no doubt at least ten times on average what Bronco pays for its Chardonnay grapes. (When we are able to get cheaper grapes of high quality, we charge less for our wine, by the way.)
Fourth, by selling directly to TJs, Bronco avoids the extra margin wholesale liquor distributors require. I am told that in states where Bronco is unable to get a liquor distribution license and has to use a wholesaler, the price goes to three dollars a bottle at retail. But this is based on industry gossip, and I can't cite any authority. I have only shopped for it in California, where the price is two bucks.
Fifth, the California State Fair Commercial Wine Competition is known for being one the less wine-snobby competitions.
Even considering all these factors, it is somewhat miraculous that Charles Shaw has won this award.
Incidentally, I fully agree with Bill Franzia of Bronco, who says:
Generally speaking, restaurants sell wine at double the retail price, which makes it a luxury item with dinner. In some countries, like Italy, where wine is expected to be part of the meal, markups are much lower. Of course, this means raising food prices a bit to supply the extra income lost from wine, since many restaurants break even on food and make their real profits on the liquor sales. So the approach only works where most poeple expect to drink wine with their meals, or where a restaurant is able to make money on its food.
I hope that restaurants start taking Bill Franzia's advice. It would do the wine industry a lot of good if people could sample wines with their meals without spending $10 a glass for the privilege.
In the meantime, if you are in one of the states where Trader Joe's operates, you might consider picking up a case of their Chard - it makes for terrific summertime drinking.
And once you start enjoying Two Buck Chuck Chardonnay, give a try to some of the other fine wines out there. You will discover that there's a lot of interesting differences among various wines. There's no one "best" wine, but rather lots of interesting approaches to making this ancient and honorable beverage, including the approach of Bill Franzia, whom I enthusiastically salute.
Hat tip: Jeff Weinress
Thomas Lifson is editor and publisher of American Thinker.