2008年9月15日 星期一

When CEOs Become Winemakers


When CEOs Become Winemakers

Many successful CEOs love wine, and some choose to make their own. Then they find out just how difficult—and expensive—it can be

Frank Grace, an American based in London and group chairman of Team Relocations, a corporate relocations company, recently discovered one of the great secrets of the wine business: You make a lot more money selling 30,000 cases of $15 wine than you do selling 6,000 cases of $75 wine.

It is the reason that such high volume vineyards as Kendall-Jackson's Vintners Reserve and Yellow Tail have made fortunes for their owners. However it is a lesson that many CEOs, successful in other fields and financially secure, never learn. As often as not they are not so much concerned with making money from owning a winery as garnering prestige and enjoying the lifestyle of being a gentleman farmer in such salubrious spots as Napa or Tuscany.

Grace originally purchased Il Molino di Grace in the heart of Italy's Chianti region as a vacation home and, because the property contained vines, he began making high-end Chianti Classico and Super Tuscans.

It's the Money

Over time, though, he found his involvement in the winemaking aspects of Il Molino have assumed a far greater demand on his time than he anticipated. The winemaking started as a hobby but is now developing into a money-making operation, a viable business. He has learned that "you can't protect your quality unless you're making money and besides, it's against my religion to not make money. If something's not working financially, ultimately it's not going to survive."

This is the central dilemma faced by any CEO looking to make wine as a hobby: It's a very expensive hobby.

Last year, though, Il Molino di Grace began to make money on an operating basis, after 11 years, thanks to its new, lower-priced label, Il Volano, which retails for around $15 a bottle—about half the price of its Chianti Classico Riserva. But Grace is also learning what everybody who owns a winery learns: namely, that any profit has to be pumped right back into the business. As he puts it, "any money you make, you quickly find ways to spend."

Another aspect of owning a winery that surprises many executive amateurs is how you have to wear many different hats. Susan Hoff, former senior vice-president at Best Buy (BBY) recalls how she and her husband were so excited when they received the first order at their new winery, Fantesca Estate in Napa Valley, but then realized that neither of them knew how to process the credit-card payment. "You are so not used to that, having to take care of everything yourself, when you step off the corporate runway" she explains.

For fun or for business?

Bill Murphy of Clos LaChance in Santa Cruz, Calif., experienced the same thing when he left his senior-vice-president position at Hewlett-Packard (HP). His wife cautioned him that she wasn't going to book his plane tickets. "I had people to do things like that!" he exclaims in mock indignation. "Now I have to make my own travel arrangements."

On a more serious note, he advises any aspiring owner that there are important decisions that have to be made going in. "Do you want to be in it as fun thing, to go to the Napa Valley Wine Auction and try to make the world's best Bordeaux blend, where it's more of a hobby than a serious business? Or do you want to make a business out of it?"

He cautions that "if you want to do the former, that's fine, it can be a lot of fun, even though it will cost you a lot of money. But it's hard for people to take you seriously if that's all you are going to do."

Richard Parsons, chairman and recently retired CEO of Time Warner (TWX), finds the rewards of owning Il Palazzone in Montalcino, Italy, are twofold. "It is a personal experience and the very opposite of what I do in my day job…and the end product is something tangible and beautiful."

Immersed in Silence

The pleasure he takes his winery and its wine is summed up in its motto: "We drink all we can and sell the rest!"

He also finds great relaxation in being in Tuscany, telling an earlier interviewer that "for someone like me, who lives and works in the chaos of New York, spending a few days immersed in silence, surrounded by these splendid hills, it is a dream."

For Joe Anderson, chairman and CEO of health-care-management and consulting company Schaller Anderson, and now owner, along with his wife, Mary Dewane, of the Benovia Winery in California's Russian River Valley, the biggest reward of owning a winery is the ability to participate in a long-term project. "It really changes your whole approach to life understanding that you're only along for the ride. You can provide all the input that's necessary, but the whole thing will happen on the vines' schedule, not yours. You've got to sit back, sip some wine, watch the vines, and be happy."

Not an approach many CEO are in the habit of adopting in their professional life, but then perhaps that's the point.

Click here to see which CEOs divide their time between the board room and the vineyard.

Passmore is a writer and photographer living in New York City.

2008年9月9日 星期二

cork wine-stoppers are making a comeback

Putting a Cork in It

Cork, harvested primarily from the cork oak trees in Portugal, has long
been used to seal wine bottles against the ravages of time and air. After
a decline in use as wine-stoppers due to the increase in the use of
synthetic alternatives, cork wine-stoppers are making a comeback.

The DW-WORLD Article

2008年9月7日 星期日

“Kvass”(‘bread drink’)

EuroVox | 08.09.2008 | 05:30

Tasting a Special Drink from the Streets of Eastern Europe

For centuries, people in many Eastern European countries, have been drinking “Kvass” -- which translates into English as ‘bread drink’.

Kvass is a mildly alcoholic drink made from fermented rye bread and it is often flavoured with herbs like mint or fruits like strawberries. During the hot summer months on streets in Russia, Belarus and Poland, vendors wheel around large yellow barrels, selling the brewed drink.

2008年9月6日 星期六

German Wine Producers Discover the Art of PR

Food and Drink | 06.09.2008

German Wine Producers Discover the Art of PR

After years of being thought of as cheap and sugary, German wine is enjoying huge international success. It owes its success to producers who are adapting to accommodate a new generation of consumers.

As the first grapes of this year's harvest are due to be picked in the coming weeks, wine producers are optimistic about the 2008 vintage. But Raimund Pruem, who has been producing wine in the Moselle Valley for over 30 years, remembers a time when Riesling was not so prosperous.

"The bad reputation of German wine really hurt us," he said. "I will never forget a blind tasting we did a while ago. The judges gave tremendous praise: Against South African and Australian wines, German Riesling did the best. But when they took off their blindfolds and saw the labels they started making excuses for their comments."

Since then, however, German wine has made a comeback, particularly in the US after some Moselle Valley vintners earned the attention of the hugely influential American wine critic Robert Parker.

A new generation of customers

Raimund Pruem stands by the Moselle River and fields of his vinesBildunterschrift: Großansicht des Bildes mit der Bildunterschrift: Pruem produces around one million bottles per year

As German vintners don't tend to produce very large quantities of any one style of wine due to the varying conditions in the vineyards, most of their wine sold abroad goes through specialist retailers or online.

Due to the steepness of the slopes virtually all Riesling in the Moselle Valley is hand-picked and despite being very labor intensive, high quality German wines remain relatively inexpensive -- a new reputation that is prized by vintners.

But while Germany's sweet Rieslings are by far the most popular in the US, the German market decidedly prefers the "trocken" variety, the dry wines. Ninety-five percent of the wine the S.A. Pruem winery sells in Germany is dry Riesling.

"There is a generational problem, young people in Germany today do not drink the same wine as their grandparents anymore -- they drink only drier, more expensive wines," Pruem said.

This is a relatively new development since a sudden change in German wine drinkers' pallets in 1976 switched the demand from very sweet Rieslings to bone dry. Such changes are not uncommon in the wine business as each generation of customers presents new demands.

Producers stepping up

A VDP label around the neck of a wine bottleBildunterschrift: Großansicht des Bildes mit der Bildunterschrift: Most top German producers are members of the VDP quality wines organization

Although Raimund Pruem's vineyards have been in his family since 1158 and his daughter is now sharing his marketing responsibilities, the art of winemaking is no longer something taught exclusively from one generation to the next. Virtually all top vintners around the Moselle have studied viticulture and vinification, gathering experience with many grape varieties and in some cases working in vineyards around the world.

While Pruem's ancestors' jobs mainly consisted of winemaking, today German wine producers are increasingly spending their time promoting and selling their wines too.

"When people come here they don't want to meet the sales staff, they want to meet the producer," Pruem explained. "Who else is a better promoter than the producer himself? That's something that has changed totally. My grandfather, my father and even myself when I was younger -- we saw how it doesn't work sitting here, waiting for customers, you have to be active."

There has to be a connection between the producer and his customers, he added: "Customers need communication."

As a result, more and more producers are taking it upon themselves to host large group tastings, wedding receptions and to participate in international tasting events, touring the world with their wines.

An artful business

Vines growing on steep slopes above the Moselle RiverBildunterschrift: Wine has been produced in the Moselle Valley since before the Romans

The change in approach is evident. Producers are experimenting and reaching out more and more: Bottles of other grape varieties such as Pinot Blanc and Chardonnay -- and even the occasional red wine -- are increasingly found on tasting lists around the Moselle Valley.

But the demands of marketing are hard to keep up with.

"I have to sell my wine twice: first to the customer (the retailer), then to my customer's customer," Pruem said. "You have to go with the retailer to ensure the wine is on the shelves and is being taken off the shelves and bought."

Like most other wine producers, Pruem is carrying on the centuries-old art of winemaking: "The art is to taste the juice from the grapes and produce a wine from it that shows the signals of the vineyard." But he is also introducing a new art -- that of public relations.

"My wines need to show character, if they don't show character then forget it." -- Pruem's statement reveals the bottom line for vintners like himself: If their wine fails to meet standards, then not only is their livelihood, passion and reputation at stake, but also their legacy.

Antony Herrmann

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2008年9月2日 星期二

Viva Vivanno


('və, -vä') interj.

Used to express acclamation, salute, or applause.

[Italian and Spanish, (long) live, both from Latin vīvat, third person sing. present subjunctive of vīvere, to live.]


Viva Vivanno

Sep 2nd 2008
From Economist.com

Innovative things to do with a banana

“BEHOLD, the atheist’s nightmare,” declares Ray Comfort, an Australian evangelist, as he holds up a banana in a hugely popular video on YouTube. The fruit, he says, testifies to God’s creative genius. It comes with a colour-coding system that shows when it is ready to eat (green is too early, black too late); an easily gripped, biodegradable wrapper; and a “tab at the top” which, unlike that on a can of soda, works so well that when you pull it “the contents don’t squirt in your face.”

Not everyone is convinced. One video response points out that the banana only achieved its user-friendly qualities through evolution over many centuries of farming.

Jupiter Images Saviour of Starbucks?

But Howard Schultz certainly seems to regard the banana as the answer to his prayers for the recovery of his ailing drinks company, Starbucks. Since July 15th, the firm has been selling two new smoothie-style drinks called Vivanno, both of which are based on an entire banana—one blended with chocolate, the other with a mixture of mango and orange juices.

Mr Schultz, who earlier this year returned to the helm of the company he built into a global giant, deserves credit for trying to return Starbucks to its old approach to innovation, which was all about incremental product variation around a central platform. Just as three drink sizes and various types of coffees, milks and syrups became the core ingredients that people could customise to suit their own tastes, so Vivanno is aiming to take Starbucks into the smoothie trade (popularised by Jamba Juice) without greatly altering its production methods.

Go into a Jamba Juice store, and a team of people frantically peels and mixes fruits and powders. With a Vivanno, a barista must simply peel a banana (the simplest of tasks, thanks to God or several centuries of farmers), which is placed into a blender already in stores for producing iced frappuccino drinks. Happily, there have been no reports of baristas—let alone customers—slipping on stray banana skins.

Already, baristas and customers are suggesting new combinations involving Vivanno ingredients and traditional Starbucks products on the firms social networking website, Mystarbucksidea.com. Ideas include mixing the orange-mango juice with cream to produce something that tastes “just like an Orange Creamsicle” (sic) or mixing the smoothies with the firm’s Tazo teas. And customers are being invited to add a shot of espresso to the banana-chocolate Vivanno.

Certainly, the simple addition of bananas to the Starbucks mix seems to be working more, er, smoothly than the previous big innovation, the hot breakfast sandwich, which required bulky additional equipment and confused customers and baristas alike as to where the sandwich should change hands after heating.

Yet the Vivanno’s taste has received a mixed reception: some customers find it chalky and artificial. Certainly, Mr Schultz was getting carried away when he said to Portfolio magazine recently, “Tell me this isn’t, like, over-the-top! Is that fantastic?”

Your correspondent suspects that many of the grumbling customers have grown so accustomed to the sugar and other fattening ingredients in Starbucks’ drinks that the Vivanno’s natural taste (the fruit provides all the sugar) took them by surprise. Other customers may welcome a healthier option.

Clearly, the Vivanno alone will not revive Starbucks, which expanded too fast and diluted its quality and culture in the process. Getting the store closures right and finding other new products will be crucial.

But the banana beverage may be the turning point. It seems to be catching on with the many Starbucks customers who have complained over the years about the company’s descent into the obesity business. One of the many Starbucks outlets near The Economist’s New York office is selling the Vivanno at four times its target volumes. The firm’s share price, which hit a five-year low the day before the Vivanno was introduced, has since risen by around 10%. If not exactly proof of the existence of God, this does at least suggest that even fallen companies can have some hope of resurrection.

Spanish Wine Industry Suffers From Climate Change

Money Talks | 03.09.2008 | 04:30

Spanish Wine Industry Suffers From Climate Change

Ten years ago, most Spanish vineyards would start gathering their grapes during September, but temperatures have been rising, resulting in many grape varieties ripening up to a month earlier.

Until now, the changes to the grapes caused by higher temperatures, such as faster maturation, have generally had a positive impact on the wine's taste. But with temperatures expected to continue going up, climate change poses a threat to Spain's wine industry and a challenge for winemakers worldwide.

Report: Danny Wood