Honestly, is there anything redeeming about 2020? Yes, obviously there are one-off instances of positivity: babies, engagements, promotions, etc. But I think most people would agree that this year has been a doozy, THANKS COVID, and no one would be shocked if swarms of locusts were next on the list of fun surprises. (We already had murder hornets, Tiger King, a "Godzilla" Saharan dust cloud, and a "presidential" "debate," so it's really not that much of a stretch.)
I sincerely hope that there are very few people out there who have been affected by ALL of these challenges (if you have, go buy a lottery ticket right now), but certainly we're all struggling with various combinations from the 2020 buffet. And of course, there are also the predictable challenges that crop up annually, such as hurricanes, wildfires, the Jets... none of which decided to ease up so that we could handle the weirdness that is this hell-spawned year (other than I guess the Jets). Depending on the hand you got dealt, this year might be ready to crush you like... a grape, perhaps?
Pardon my punny segue, but it seemed like an effective way to get to the point of this blog post, which is: small wineries are really struggling right now, for several big reasons that we'll dive into momentarily. But first, let me cushion the negativity with a preview of the silver lining: If you read our first blog post, you already know that part of why Sip Wines came into existence was to help the small wineries. (If you didn't know, well, now you know, according to the Notorious B.I.G.) And by buying wine from them through us, you're helping too. Good feelz!
COVID DOES NOT SUPPORT SMALL BUSINESSES
Or as I like to call it, the "Cove." It irritates my husband almost as much as when I say "obvi" or "totes," because as he reminds me, I'm approaching 38 and it makes me seem like I'm trying too hard. <shrug> We got all of two good months in 2020 before the pandemic huffed and puffed and shut down our lives. Of course, the economy didn't like that one bit (except for manufacturers of toilet paper, disinfecting wipes, dumbbells, bread flour, and now outdoor propane heaters, apparently), and small businesses took the brunt of the devastation. But why, you ask? I shall tell you, in generalized, bullet point form for the sake of brevity.
- May have smaller profit margins, which means less ability to absorb unexpected costs.
- Often have much smaller online sales capacities, because they:
- lack the resources to devote to full-time website management staff,
- lose out on bulk shipping discounts with major shipping companies because they move smaller quantities, and/or
- may not produce on a scale that would support online sales.
- May operate on a much more tightly controlled cash flow, which means if money stops coming in, they start hurting very quickly.
- Similarly, may rely more heavily on bank loans, which are harder to come by when the economy contracts.
That's not the whole list, but you get the idea.
COVID IS ACTIVELY HATING ON SMALL WINERIES
Now, let's add in the realities of being a small business WINERY in a devastating pandemic scenario:
- Wine is typically viewed as a "luxury good," which is one of the first things consumers may eliminate from budgets when a recession strikes.
- Wine can be more complicated to sell online due to varying alcohol shipping restrictions by state.
- Wineries typically rely on distributors to get their wines into more mass market sales avenues like grocery stores and major wine outlets, but (as noted above) small wineries don't produce and sell on a scale that would attract distributors to take them on.
- Many small wineries rely heavily on partnerships with local hospitality businesses (restaurants, hotels) for their sales, and this pandemic has taken an enormous toll on the hospitality industry as well.
If you want to get real with the numbers, here's what a survey of wineries from spring 2020 revealed from just the first two months of the pandemic. Importantly, almost 3/4 of the respondents were small wineries (meaning they produce under 5,000 cases per year).
- Wineries received less than 10% of their anticipated visitors.
- Tasting room sales (which are how most small wineries make the bulk of their money) declined by almost 75%.
- Wholesale sales (for example, to local restaurants) declined by almost 30%.
Ouch. Clearly, COVID alone has been enough to make 2020 really suck for small wineries. But wait, there's more.
THEN 2020 TURNED INTO A LITERAL [DUMPSTER] FIRE
Figuratively, we were already there, and then the West Coast started actually burning. Wildfires are nothing new in California, so I can't entirely blame 2020 for that (EXCEPT I DO BECAUSE THIS YEAR IS THE WORST). What IS fairly new is the sheer scale and scope of the fires, and their impact on an industry that didn't need more pain.
FACT: Wildfires in California over the last 10 years have completely obliterated all past records in size and intensity.
FACT: This is largely due to climate change, global warming, whatever you want to call it. We know this because average temperatures in California have been steadily and significantly rising, contributing to greater periods of drought that dries out vegetation.
FACT: DRY VEGETATION BURNS REALLY EASILY AND REALLY FAST.
ERGO: 2020 wildfires are the worst ever. How appropriate.
These fires have brought even greater tragedy, destroying thousands of homes and businesses, taking lives, and overall making life suck even more--and not just in California. Oregon and Washington are burning too, and the smoke from all these fires has stretched across the US.
So yes, it's bad for everyone. But there are at least three ways that the wildfires have been particularly challenging for many small wineries:
- Many wineries have been mostly or completely destroyed by fire. Millions of dollars of wine, equipment, and land have been lost.
- Other wineries in proximity to the fires have decided to reduce or eliminate their 2020 vintage due to smoke damage to the grapes. According to an article from the LA Times: "Smoke contains compounds that bind to the skin of grapes and get absorbed into the fruit. The aroma releases throughout the fermentation and aging process, making a seemingly unaffected wine taste more ashy over time." (Fortunately, many wineries have been able to recover some grapes, and others were not seriously affected, so we don't lose a 2020 vintage across the board.)
- Losses transcend economics. As we hope you're discovering from our site, wine and the winemaking process is DEEPLY personal for many of these wineries. Many have been owned by families for generations, others represent a life's work. A New York Times article said it beautifully:
"The wine itself is the product of vineyards, living entities that have been nurtured from cuttings, sustained and protected through natural threats and maladies until, finally, the grapes are harvested. The French word for fermenting and aging the wine is élevage, which means raising or rearing, as you would a child.
What’s bottled is not just a beverage, but a legacy of the people who grew the grapes and made the wine, a snapshot of their thoughts, their emotions and their labor as they seek to convey the character and personality of a place through the wine.
To lose a vintage, much less a vineyard, is devastating."
AND YET THERE'S HOPE, AND THAT'S WHY SIP EXISTS
All wit and snark aside, this year has wreaked havoc on all our lives in one way or another, and there hasn't been much that any of us can do about it. But I'd like to wrap up this admittedly Debbie Downer of a blog post with a small ray of hope.
Little things matter.
Look, I know cynicism is trendy and idealism can seem childish, but I'm proud to say that I'm still an optimist. Maybe we can't cure COVID, we can't stop the wildfires, we can't save the polar bears by ourselves or determine the outcome of the election. But maybe you were going to replenish your wine supply by ordering a case, and maybe you order that case from one of the small wineries featured at Sip Wines. And maybe a few people do that too, and maybe that small winery doesn't have to lay off an employee to make ends meet before their bank loan comes in. It's not so hard to believe that your case of wine could change someone's life, is it?