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© 2009 ACMEFINEWINES.
Suddenly, those rare wines aren't so rare
February 01, 2009
by Jon Bonne, Chronicle Wine Editor
I come from a long line of bearish investors, so in this grim time for selling expensive wines, it's my genetic duty to note that now is also the best time in years to buy 'em.
The economy has forced nearly everyone to take their drinking budget down a peg or four. But that hardly means wine sales are plummeting, although many retailers say liquor sales are taking a larger slice of business. Hard times favor the hard stuff.
Somewhat. Jon Fredrikson of research firm Gomberg, Fredrikson & Associates estimates most of us are shrinking what we'll spend on a bottle of wine by 20 to 50 percent for anything more than $10, with the occasional splurge. The thirst for $25 has dwindled to $15; $8 is the new $12.
That perilous midrange above $30 and below, say, $100? That's where the real fear lies if you make wine.
Christmas shoppers thought small - the $100 gift became a $50 bottle. And though the well-heeled clientele at Acme Fine Wines in St. Helena still seek out the impossible-to-find $150 bottles that owner David Stevens specializes in obtaining, he says his regular $50 shoppers have downshifted to around $30.
Wine auctions struggled through the latter half of 2008, slashing their projected hammer figures. Paul Hart, president and CEO of Chicago wine firm Hart Davis Hart, says lot prices have dropped between 10 and 30 percent since last summer, in part a correction of a runaway bull (wine) market in the past three years.
San Francisco's Vinfolio, which specializes in locating high-end wines, has a different worry. Its average bottle price remains around $170, according to CEO Steve Bachmann, but with fewer sales. Bachmann suspects some customers are drinking their collections instead of adding bottles: "It's like tapping the oil reserves in Louisiana," he says.
In other words, it's a buyer's market. If you have the money, now is the best time in perhaps a decade to start a collection or taste the unattainable. It's like finding Berkshire Hathaway at a three-year low.
For that matter, to you shoppers in the closeout aisle: Keep a keen eye out as the Great Inventory Dump of '09 commences.
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