Friday, January 20, 2012

Richard Serrano of L’eft Bank: Selecting Domestic and Austrian Wines– Part II of III



MadisonWineScene (MWS) recently interviewed Richard Serrano, Wine Manager of spirits and domestic and Austrian wines with L’eft Bank Wine Company, 4918 Triangle Street, McFarland, WI about the wine business.

His bio on the L’eft Bank site (http://leftbankwine.com/FUN.aspx) states: Raised on beer and tequila since the age of 12, Richard had his first sip of White Zin at the age of 26, and declared it righteous. A bottle of cheap Chilean Merlot followed a week later, and there was no turning back. After a brief flirtation with high-alcohol fruit-bombs, two years in wine retail tempered and matured his palette. He now spends his time in the Sisyphusian pursuit of finding Domestic wines that emphasize balance, purity, and terroir. Known as the company hothead, he spends his off time listening to acoustic blues, reading Decanter, and trying to find old bottles of Roussanne on closeout.

A previous post discussed how Richard chooses wines.  This post discusses selection of wine producers.

MWS: How do you find wine producers for your portfolio?
Richard: Every time I go to California, or Oregon, or Washington (or Austria for that matter) I am looking for new things. A lot of times it is to shore up relationships but I am always on the lookout. I might see something in a store that attracts me, or I might be talking to a server in a wine bar. That’s how I was turned on to one wine, in particular, out of Washington state – I was in a wine bar and I started talking about Riesling with somebody and he said that you have to try this dry Riesling from this tiny little producer.

I am constantly reading all the wine publications and I am online a lot. I know of producers that have not been in this state for some time that I have always had my eye on, and so I might finally visit them or do a tasting of few of their wines and then approach them.

I also might steal wineries from other distributors. We have an exclusive thing in Wisconsin so, for instance, L’eft Bank represents Ridge out of Santa Cruz. No one else can sell Ridge in Wisconsin. Another distributor could steal Ridge from me. I have stolen suppliers from other distributors. It is difficult. You have got to make a pitch, maybe sales are weak with their current distributor and you have to show them why they should come to you.

And then with the recession, I am inundated all the time with people who just call me and email me out of the blue, maybe they have heard of L’eft Bank and our reputation or they have just done a Google search and they are looking for distribution in Wisconsin.

MWS: When you look at wineries, do you want a certain minimum level of production?
Richard: All the different sized wineries bring something unique to the table.

For instance, L’eft Bank represents. Bogle is a very large, and high-quality, producer; they make a million cases a year. Bogle is key to our business, because Bogle makes $9.99 wine and at the end of the day, that’s what people drink the most of. That keeps the lights on. That’s a very important brand to us.
[MWS: For the 52 week period ending June 13, 2011 Bogle was the 18th ranked brand in the US with retail sales of $53 million, an increase of 18% over the previous year, according to SymphonyIRI Group, a Chicago based market research firm.]

On the flip side, that Washington producer that I was referencing in regards to his Riesling, that’s a producer that nothing he makes is more than 100 cases of anything, and he was only in Washington and Oregon, and when I originally spoke to him he didn’t want any extra distribution in another state. Certainly Wisconsin is not one that someone like that looks to immediately. But I stayed on his case and when the economy was going south he said I would like to have any avenues that are available for me for sale and you are the guy who is calling me and wants my wine so sure – so now we represent him in Wisconsin.

He is still only in 3 states, so very tiny production but very cool wine, and very unique. He is pushing the envelope, for instance he makes a dry style Riesling that is really just piercing acid on the tongue, and it is not a wine for everybody so if he made buckets of wine I wouldn’t have hope for a lot of it because it is for a specific type of consumer. So the fact that he is small is beneficial.

It is very easy to make too much wine, and then end up with old juice collecting dust.

MWS: What’s the label?
Richard: Scarborough. (http://www.osheascarboroughwines.com/index.htm).

He does a dry style Riesling, he does a Semillon/Sauvignon Blanc blend, and then he makes some wonderful Syrah. Syrah is tough to sell so it’s a good thing that he is very small so I can just show it. There are only so many retailers and restaurants that hand-sell products, meaning that they will actually engage with the consumer and tell them why this new wine they found is special to them. A lot of other times it is just what the consumer grabs off the shelf.

MWS: How much of your domestic wine portfolio is from California?
Richard: About 75% would be from California.

The next biggest chunk would be Oregon, followed by Washington. Washington is coming on strong, but Oregon has been established for a little bit longer and Pinot Noir being what it is, I have a lot more from Oregon.

MWS: Are Oregon wines too expensive?
Richard: Yes and no.

You can find, especially now, more and more Oregon Pinot Noirs, which are even selling for below $15, which was not the case for a long time. I just brought in a new Oregon Pinot that you can see on the shelf for $13.99.

But yes -- there are couple of reasons for why Oregon wines are more expensive.  There is much less land planted with grapes in Oregon, it’s tiny. Also, unlike California where you can grow a sea of wine grapes on very low, flat land, in Oregon they have problems with ripeness, and you really can’t start growing wine grapes until you get to about 250 feet above sea level. And a lot of Oregonians will say that from about 300 feet to about 800 feet is the sweet spot so right away you are planting on tougher land to farm. In contrast the Central valley of California is a vast expanse of flat vineyard land, very easily farmed with heavy machinery, and it is going to produce tons of grapes. It is much easier to make a cheaper wine there as opposed to Oregon. People have been overplanting in Oregon in the last few years, due to the success of Pinot Noir, and people have planted in poorer areas, and you will see cheaper wines, and maybe not as good. But in the end if you want a drinkable $9.99 Pinot Noir, go to California. It is just not what Oregon is going to be able to do.

MWS: When you are making your decisions about which wines to carry in your portfolio do you think about whether it will be sold to a retailer or a restaurant?
Richard: Yeah. I am thinking about what types of retailers and what types of restaurateurs are going to be interested in that wine.

Some wineries say to me I am happy if you sell to whichever.

Some wineries come in and say I really need you to sell 300 cases and then I have got to think do I have enough avenues for that.

Some wineries will have specific demands that they want to see 80% restaurants, 20% retail. Since the recession, less and less people say that.

I am always thinking of where will this wine work? So thinking about that lower-end Oregon Pinot that I just brought in, that’s a perfectly priced Oregon Pinot for a glass pour. And there are only so many Oregon glass-pourable Pinots. So right away I thought this will be very easy to hit a lot of restaurants and get a lot of glass-pour action. Boom. The retailer will want it because there isn’t much from Oregon at that price.

On the other hand, coming to Austria, where most of the sales are going to be in white wine, Grüner Veltliner and dry Riesling specifically, but I love Austrian red wine coming from native Austrian grape varieties. So if I bring in a Blaufränkisch, and I was just out sampling a Heinrich Blaufränkisch the other day. This is a wine that will retail for $29.99. No restaurant is going to pour it because of the price. And if a restaurant puts a Heinrich Blaufränkisch on their bottle list it is never going to move. I need very geeky and active retailers who are going to taste it, love it, and then when that person walks in the door who usually buys a $30 Cabernet, they can say, hey check this out, I have got a Blaufränkisch from Austria that you should really try. So that’s a wine, if I get any restaurant action it will be lucky.

MWS: Do ratings affect any of your decisions?
Richard: Not particularly.

There are some wineries that I have gone after to sell, because one they make great wine, and I also know in the back of my head that they get great press. I know that will help the sell-through, but it is not the defining factor for me.

I have been approached by wineries that have a 90+ from Spectator for instance, and it is a palate that I usually disagree with in Pinot Noir in particular. I remember one Pinot Noir producer who had multiple Pinot Noirs, they were all scoring between 90 and 94 points, but to me they just tasted like they were doctored up with Syrah, they didn’t have what I think Pinot Noir should be, it didn’t have purity of fruit, they were over the top, and I said no. And the guy was very insulted and put off and the main thing that upset him was that he had good press.

Now I use press to sell-through wine, I don’t try to use it to sell wine, and what I mean by that is, if I take a wine to a retailer, I want that retailer to like the wine itself, and the story and the typicity of it, and buy it for that matter alone. Some buyers only care about points and then I will be more than happy to say, well, yes it did happen to get 92 points from Spectator. And then we put the scores on the shelf to help with the sell-through.

I am always uncomfortable about it, I don’t like the numbering system, I wish it would go away, but I am afraid it is here to stay.

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