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WINE: Constellation cuts Beam staff; two conferences examine trends

The sale of Fortune Brands’ Healdsburg-based U.S. wine group last month to

Constellation Brands has quickly led to a personnel shakeup as Constellation reorganizes its U.S. wine operations into three product groups.

Constellation let go 93 of the 520 Beam Wine Estates employees in the North Coast last week as part of a phaseout of the Healdsburg office and blending of the two organizations’ sales, marketing and administrative teams. The Beam brands are Clos Du Bois, Geyser Peak, Buena Vista and Gary Farrell in Sonoma County; Wild Horse in the Central Coast; and Atlas Peak in Napa Valley.

Many of the remaining Beam employees will shift to the Constellation office in St. Helena, where the world’s largest wine producer has its Icon Estates fine wine division, according to a spokeswoman.

Wild Horse was put into the Icon Estates unit. The other Beam brands are going into the new Vintas unit.

Constellation will trim some staff at Constellation Wines U.S. to make room for the Beam employees it will keep on board.

These organization changes are set to be completed by March, but some outgoing employees will be staying on for six months to a year thereafter to help with the transition, according to the spokeswoman.

Connected to the reorganization, former Beam Wine Estates President Bill Newlands will rejoin Fortune as vice president of U.S. commercial production at the end of this month, and Chief Marketing Officer Chris Lynch left for other pursuits.

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Coincidentally coming the same week as Cal Tech research that suggests consumer perception of a wine can be influenced by the bottle price, Sonoma-based Don Sebastiani & Sons noted its intent to increase prices as it moves its brands upscale this year and hires more sales staff to handle rapid growth past 2 million cases of wine sold last year.

Sales growth for key brands Pepper-wood Grove and Smoking Loon are expected to level with the price increases as the company exchanges rapid growth for higher margins.

The Other Guys division of smaller-production brands will move to average prices of $15 to $50 a bottle and will be targeted toward upscale restaurants and wine shops.

The company also will be producing a line of limited-release brands and dismissed rumors that it would sell a key brand.

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As winegrape vines slumber, North Coast wine industry professionals will be active in late January at conferences in Sacramento and Santa Rosa.

More than 10,000 people are expected at the Unified Wine & Grape Symposium from Jan. 29 to 31 to hear prognostications on industry trends this year and beyond as well as learn about the latest viticultural and enological research and tips on 21st century marketing.

Presenters at the hall-packer State of the Industry report on Jan. 30 will have a reason to be happy with wine-sales results from last year.

“Wine consumption in the U.S. reached another record high in 2007 as growing numbers of adult drinkers consumed more wine than ever before,” said veteran panelist Jon Fredrikson of Gomberg Fredrikson & Associates. “In the growing but extremely competitive U.S. market, many wine businesses prospered.”

The symposium is outgrowing the Sacramento Convention Center. This year organizers will have another 40 exhibitor booths available in a third-floor tent, allowing 100 exhibitors to come off the waiting list. However, exhibitors, numbering nearly 550 as of last week, will have to make due with their existing show space because the organizers want to use remaining space for newcomers, according to a spokeswoman.

One waitlisted exhibitor isn’t waiting until 2009 to make a splash at the symposium. Krueger Winery Technology LLC, a developer and vendor of screwcapping and cellar equipment in St. Helena, has rented a hospitality suite in the Hyatt Regency hotel adjacent to the convention center to tout its joint venture with German beverage screw cap manufacturer Mala Verschluss-Systeme GmbH to build a production plant in south Napa.

In Santa Rosa, the Sonoma County Winegrape Commission expects several hundred to attend its 17th annual Dollars & Sense Seminar and Trade Show at Wells Fargo Center for the Arts on the morning of Jan. 24.

Part of the event will be the annual review of the previous harvest and the outlook for Sonoma County winegrape growers in 2008, provided this year by Turrentine Brokerage partners Brian Clements and Steve Fredricks.

Looking at the "spot" market for grapes and bulk wine last year and winery sales results, the two plan to talk about what looks like the best market for North Coast winegrapes overall in more than five years.

"We see the market correcting from an oversupply to somewhat of a shortage for chardonnay and Napa (cabernet sauvignon), and I think merlot will stabilize," Mr. Clements said. "The dark horse is what to do with syrah because not many people are beating on the door."

Other presenters will be E&J Gallo viticulturist Nick Dokoozlian on cost-

effective viticulture, agribanker “Corny” Gallagher on world trends and reflections of the dry 2007 season by Sonoma County Water Agency engineer Rem Scher-zinger and consulting viticulturist Mark Greenspan.

A brand security conference set for Jan. 16 in Sonoma was canceled because of a lackluster response, according to Dan Welty, digital print manager and marketing director of Petaluma-based MPSDigital, formerly John Henry Packaging. Only three wineries, a major food producer and a nutraceutical maker registered.

Lined up to speak were Mr. Welty, an expert on brand security from HP, which makes the Indigo digital presses MPSDigital uses; and another HP staffer who has researched the wine business.

“These companies will need to have an occurrence before they will buy into what amounts to an insurance policy,” Mr. Welty said, referring to digital wine label printing with the ability to include forgery-fouling features.

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At the end of 2007 Rene “Ren” Schlatter, co-owner and son of Merryvale Vineyards founder Jack Schlatter, replaced 11-year President and CEO Peter Huwiler as head of the 24-year-old St. Helena wine company.

Charles Krug brand vintner Peter Mondavi Jr. is set to serve as 2008 Honorary California Wine Ambassador for the Portland Classic Wines Auction on March 1.

Napa-based Ben Franklin Press &

Label Co. hired Tom Jacobs to open the firm’s sales office to serve Pacific Northwest customers. Since 2001, he had managed sales in the region for Kodak’s Creo group.

Hall Winery in St. Helena named Rachel Wesley as Midwest sales manager. She came to Hall from a similar position plus national account sales at fine wine importer Kysela Pere et Fils.

Ladera Vineyards in Napa County’s Howell Mountain appellation promoted Trester Goetting to associate winemaker and hired Sarah Taylor as regional sales manager in California and Nevada. Mr. Goetting came to Ladera in 2004 as assistant winemaker. Ms. Taylor previously was sales manager for West Coast Wines.

Joel Gott Wines in Napa hired Chuck Spelman, former Delicato Family Vineyards national sales senior vice president, as national sales manager. Joel Gott is the co-founder of the Taylor’s Refresher retro burger restaurants in St. Helena and San Francisco; another restaurant will open soon at Oxbow Public Market in Napa.

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Submit items for this column to Jeff Quackenbush at 707-579-2900 ext. 206, jquackenbush@busjrnl.com or fax 707-579-8475.

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