Table of Contents Welcome . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Event Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Today’s Objective. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 New Perspectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Session 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 The Evolution of the Wholesale Channel: Innovation Driven by Demand
Article: 5 Questions Before Contacting Distributors. . . . . . . . . . . . . . . . . . 12 Session 2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Understanding the Distributor Mindset
Session 3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Win-Win Distributor Negotiations
Session 4. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 New Product Launch: Expanding Your Market
Session 5. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Getting Your Fair Share of Attention... and More!
Article: Winning Distributor Attention. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Session 6. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 The Changing Nature of Market Visits
Session 7. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Planning for the Future: Success Is Not an Accident
Action Planning Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Glossary of Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Exhibitor Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Participate and interact at the 3-Tier Wine Symposium with Sli.do. You can ask speakers questions from any device, and vote for the ones you like the most!
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Welcome to the 2019 3-Tier Wine Symposium Dear Attendees, Welcome to the first 3-Tier Wine Symposium. The idea of tackling, arguably, one of the most challenging components of the wine industry and finding ways to successfully execute in the wholesale channel is a continuing topic of conversation at the Wine Industry Network. However, it wasn’t until late last year when I read an article written by Laura Webb, today’s moderator, that we decided to commit to a day-long conference focused on the topic. In the article, Laura emphasized the importance of understanding the needs and mindset of the distributor as well as thinking of them more as a partner in order to achieve your goals. It really struck a chord and encouraged us to move forward with launching the 3-Tier Wine Symposium. Our goal today is to cover as much ground as we can, beginning with a discussion on how things have evolved in the channel, new innovations and finishing up with ideas on building a better wholesale plan. In between, we’ll have experts representing both the distributor and producer perspective share their thoughts and experiences in a number of sales related areas, all in an effort to leave attendees feeling better prepared for success going forward. Thank you for taking the time to be with us today! George Christie, President & CEO, Wine Industry Network
thank you to our 2019 sponsors!
wine donated by:
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Event Schedule Laura Webb Partner / Okos Partners 3-Tier Wine Symposium Moderator
8:00AM - 8:45AM
Check-In: Grab your name badge, mingle and enjoy coffee & breakfast pastries before the symposium.
8:45AM - 9:00AM
Welcome: Introduction + Opening Remarks
9:00AM - 10:00AM
Session 1: The Evolution of the Wholesale Channel: Innovation Driven by Demand
10:15AM - 11:00AM
Session 2: Understanding the Distributor Mindset
11:00AM - 11:45AM
Session 3: Win-Win Distributor Negotiations
11:45AM - 12:45PM
Lunch: Enjoy a beautiful outdoor lunch specially prepared by the Vintners Inn / John Ash & Co. Chef.
12:45PM - 1:30PM
Session 4: New Product Launch: Expanding Your Market
1:30PM - 2:15PM
Session 5: Getting Your Fair Share of Attention... and More!
2:30PM - 3:15PM
Session 6: The Changing Nature of Market Visits
3:15PM - 4:00PM
Session 7: Planning for the Future: Success is Not an Accident
4:00PM - 5:00PM
Networking Social: Finish the day visiting with exhibitors & attendees at a networking session featuring hors d’oeuvres and selected wines.
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3-Tier Wine Symposium
Today’s Objective
What are the challenges in 3-Tier today?
How can I solve these challenges more effectively?
How will I implement these ideas and change the way I address tthese challenges after today?
NEW PERSPECTIVES
NEW IDEAS
ACTION
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New Perspectives New Perspectives
Traditional bargaining between the distributor and supplier focuses on each party taking a firm POSITION and sticking to that POSITION. Traditional bargaining between the distributor and supplier focuses on each party taking a
Bargaining firm means “I win,and you lose,”toor “You win, I lose.” Two parties who bargain over POSITIONS POSITION sticking that POSITION. rarely get what they want. Bargaining means “I win, you lose,” or “You win, I lose.” Two parties who bargain over POSITIONS rarely get what they want.
Instead, approach discussions as a negotiation, where the focus is on the INTERESTS behind each position — the range of issues that are stake in the negotiation. Paying attentionbehind to interests help Instead, approach discussions as aatnegotiation, where the focus is on the INTERESTS uncover theeach “why” behind a range position. position — the of issues that are at stake in the negotiation. Paying attention to interests helps uncover the “why” behind a position.
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yourself in other person’s shoes • PutOpen, deeper dialogue
• Focused on what I get
• Put yourself in other person’s shoes
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3-Tier Wine Symposium
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SESSION 1
The Evolution of the Wholesale Channel: Innovation Driven by Demand Session Overview: Over the last 25 years, the number of distributors serving the US market is less than half of what it was while the number of wineries has increased more than five-fold during the same period. Additionally, the number of retailer mergers have limited options, making the wholesale channel one of the leading business issues facing the wine industry today. In the wake of all this, new route-to-market options are emerging, providing alternatives for smaller suppliers to get the attention and focus they need. How much of an impact are they making? What other trends are emerging to serve the wholesale needs of fine wine producers? This opening session will provide an overview of the evolution of the distribution network, what has changed and what we can expect the distributor landscape to look like in the near future.
Moderator:
Laura Webb Partner / Okos Partners
Speakers:
Philana Bouvier
SVP New Business Development / Young’s Market Company
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Cheryl Durzy
Founder & CEO / LibDib
Jake Hegeman
VP of Legal and Regulatory Affairs / WSWA
Throughout the day, use the included notes pages to capture your insights on distributors’ POSITIONS, INTERESTS, and any IDEAS that best address them.
NOTES
What did you hear in this section about…. Your distributors’ needs? (POSITIONS)
Why do these needs matter to them? (INTERESTS)
What ideas did you hear to address their interests? (IDEAS)
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5 Questions Before Contacting Distributors by Dave Moore, National Sales Director / Sojourn Cellars Over the last 20 years the number of U.S. wineries has more than quadrupled. There are now over 9,000 wineries across the country. California is home to around half of those, almost 4,500 wineries. During this same time the number of wine distributors in the U.S. has dropped from around 3,000 in the late 1990s down to roughly 1,100 today. Competition is fierce. Getting noticed is hard. New brands enter the market every day. But successful brands are built all the time. Weekly we hear stories of some start-up craft brand being sold for tens of millions of dollars. Maybe your goal isn’t to sell your brand but rather be offered in top restaurants across the country. Regardless, if you want to grow nationally then you’ll most definitely need the help of distributors to get you there. And if you’re just starting out and thinking about working with distributors, here are 5 questions to ask yourself before contacting them: 1. What is your long-term vision?
2. What markets are a good match for you? Determine in what states you’re most likely to find new customers. I started with California, Texas, Illinois, New York, and Massachusetts. There are plenty of wine consumers in these states that drink my style and price of wine. Plus, I had contacts in each of these states, so it was easier for me to get referrals and provide support. Find out where your brand is a good fit. Sometimes getting into new states can start by getting authorized by a regional/national chain. Once approved, you are free to contact distributors letting them know headquarters has authorized your wine. Having built-in sales when you contact a distributor is a great way to get noticed and set up a meeting. Ask the buyers which distributors they prefer to work with and if they can make an introduction.
3. What segment is your wine best suited for (on-premise, off-premise, or retail chains)?
2. What markets are a good match for you?
a. On-Premise: bars, restaurants, sports venues, concert halls, etc.
3. What segment is your wine best suited for (on-premise, off-premise, or retail chains)?
b. Off-Premise: fine wine shops, independent liquor stores, etc.
4. Can you increase production and maintain quality as sales grow?
c Retail Chains: Kroeger, Total Wine & More, BevMo, Whole Foods, etc.
5. Which distributor is the best fit for you?
It’s good to know where your wines fit on shelves or on wine lists at restaurants before meeting with distributors. If you’re just starting out, try visiting a variety of both on-premise and off-premise accounts. What brands do they currently carry that are similar to yours? Is the price the same, higher, or lower? Familiarize yourself with prices of wines in your same category. This is referred to as benchmarking. I do this when I work with distributors and I do it on my own. Research wine lists and survey retail accounts looking for benchmark brands. Ensure your wine’s shelf price is in line with benchmark brands you’ve identified. Confirm that distributors will earn a healthy profit margin if they were to carry your wine. The higher the profit margin for your distributors the better!
1. What is your long-term vision? You should have a clear picture of where you see your brand in the future. One year, three years, and 10 years down the road. Building a national brand takes commitment. Meet with your brand stakeholders and decide how much and how fast you want to grow. Determine how many cases you ultimately want to sell through distribution. Does this number make sense and is it achievable? An increase in sales takes an increase of capital. Bigger doesn’t always mean more profitable. Helping sell excess inventory is a poor reason to contact distributors. Ensure you have the resources time, and commitment from your team to achieve your long-term vision.
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4. Can you increase production and maintain quality as sales grow? Make the following promises to your distributor if they agree to work with you: #1 – that you won’t run out of inventory #2 – that you won’t raise price Distributors need to know that if your brand starts to grow that you’ll be able to keep up with demand; and you won’t raise your prices! I know it sounds crazy. The price of producing wine goes up every year. Labor prices increase. Raw material prices too. But unfortunately, the prices to consumers have stayed relatively the same over the years. It’s rare for a brand to increase price and for sales to stay the same. Keep in mind that a small $0.50 increase per bottle to the distributor can sometimes result in a $2.00 increase on the shelf. Commit to keeping prices consistent. Especially when you’re starting out. And don’t run out of wine. Ever. If your distributor is out of stock (OOS) on your wine, your wine will be replaced by another in an instant. Remember how hard it was to get the placement originally?
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5. Which distributor is the best fit for you? Once you decide your brand is best suited for the on-premise, off-premise, or retail chains, the next step is to visit accounts and meet with buyers. Ask them what distributors they prefer to work with and where your wine could potentially fit. For example, if your wine belongs in white tablecloth-type restaurants, then going with a boutique distributor with strong on-premise relationships may be a good fit for you. On the other hand, if your wine gets authorized across a multi-state chain of stores, contacting one of the large national distributors makes sense. Either way, do your homework, meet with accounts, and ask for referrals.
Final Thoughts Building a national brand is tough and you’ll need strong support and consistent effort from your distributors. Americans have a tremendous thirst for new brands. Especially ones with a unique and authentic story. Distributors are always eager to represent hot brands rising in popularity. They like working with supportive suppliers too. Finally, finding the right distributor to carry your wine isn’t the end game; it’s just the beginning. Be clear on your long-term goal, commit to consistency, and get ready to work!
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SESSION 2
Understanding the Distributor Mindset Session Overview: What are distributors looking for? What makes them select one new brand over another? Scores, accolades, pricing... what drives their decisions on who to represent vs. not? This session takes a deep dive into the distributor perspective and the business decisions that they face when deciding on who they work with. You will leave with a better grasp of your needs and expectations from a selling and sales management point of view. Understanding what your distributor wants is the first step in getting what you want.
Moderator:
Laura Webb Partner / Okos Partners
Speakers:
Dave Moore
National Sales Director / Sojourn Cellars
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Pete Przybylinski
Senior VP, Sales and Strategy / Duckhorn Wine Company
Jeff Roth
VP of Supplier Development / Breakthru Beverage Group
NOTES What did you hear in this section about…. Your distributors’ needs? (POSITIONS)
Why do these needs matter to them? (INTERESTS)
What ideas did you hear to address their interests? (IDEAS)
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SESSION 3
Win-Win Distributor Negotiations Session Overview: When the chips are on the table, do you know where to push and what to leverage so you get the most out of your distributor agreements? How do you balance your channel development so that your pricing in the market supports vs. conflicts with your DTC channel? In the fight for more distributor attention, it is easy to lose sight of the primary goals, building your brand reputation and increasing your profits. Before you program away all your margins, or price yourself out of the running, understand how to support the market with strategic pricing and planning that lead to long term, ongoing returns on your investment. Hear a new perspective on what it takes to keep negotiations fair and equitable, get your terms met and create a stronger, longer-lasting relationship with your distributor.
Moderator:
Laura Webb Partner / Okos Partners
Speakers:
Keith LaVine
Director of Sales & Marketing / Disruption Wine Company
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Erik Lawrence
Managing Partner / GVM Law, LLP
Gordon Palmateer
Founder / Palmateer Wine Group, Palmateer Consulting
NOTES What did you hear in this section about…. Your distributors’ needs? (POSITIONS)
Why do these needs matter to them? (INTERESTS)
What ideas did you hear to address their interests? (IDEAS)
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How will you manage your investments in growth?
© 2019 niromaks, istockphoto.com
Strategy Leadership Marketing Sales
We make companies smarter about their business.
Experienced consulting for startups, mid-sized, & Fortune 500 companies
707 252 8880 okospartners.com Okos: Formerly ELA Consulting Group and Webb Brand Consulting
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SESSION 4
New Product Launch: Expanding Your Market Session Overview Launching a new brand is a unique challenge that even the most established suppliers can underestimate. You have one shot to get it right and it isn’t simply about having a big budget. A poorly launched brand can do long-term damage to your distributor’s confidence and trust in you. This session walks you through the A-Z on successfully allocating your time and money, and gives you tools to get buy-in on your new idea from distributor, retailer and consumers.
Moderator:
Laura Webb Partner / Okos Partners
Speakers:
Michael De Loach
Owner & President / MD Wine Industry Consulting
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Chris Denny
Founder, President / The Engine is Red
Eric Guerra
Wine Executive / Napa, CA
CHECKLIST PRODUCT LAUNCH Top Ten Checklist: 1. Conduct research, verify, analyze a. Real-life tests: shelf, focus groups, key buyers 2. Lay out strategic launch and growth plan 3. Budget realistically 4. Assign team roles 5. Engage key stakeholders 6. Communicate consistently with all launch partners 7. Recruit brand champions, especially in the trade 8. Be prepared for on-the-ground adjustments 9. Measure results consistently 10. Promote in all channels and through all modes
#1 Mistake
Making too much of the product too fast Others: Falling in love with your first idea, being unrealistic about launch pricing, not having a plan for success
Spend
Minimum of $25 per case forever. 15-20% of GP first three years, then taper to 10-15%. Expect to invest for 5 to 7 years before reaching sustainable profitability.
How long in advance do you start talking to distributors?
It’s never too soon! Communicate to ALL of your launch partners consistently. Be prepared for a long haul. Some markets may adopt immediately, the majority of target markets take 6 to 12 months, tougher markets take at least two years.
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SESSION 5
Getting Your Fair Share of Attention... and More! Session Overview: Are you looking for more distributor attention? More placements? Do you incentivize reps? Management? Both? How do you find a brand champion who is thinking about your brand first? Understanding what motivates your distributor and their reps is critical to getting the extra attention all brands desire. Designing incentives that break through and yield long-term impacts is not easy and not the only answer. What else works to encourage the distributor to present your wines? This session brings a distributor and supplier perspective to incentive programs and structures that work, with tips on how to watch for hidden traps that cost valuable time and money for wineries with sub-par results.
Moderator:
Laura Webb Partner / Okos Partners
Speakers:
Michael De Loach
Owner & President / MD Wine Industry Consulting
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Dennis Kreps
Partner / Quintessential Wines
Charlie Plummer Director of Sales / Paul Hobbs Wines
NOTES What did you hear in this section about…. Your distributors’ needs? (POSITIONS)
Why do these needs matter to them? (INTERESTS)
What ideas did you hear to address their interests? (IDEAS)
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Winning Distributor Attention by Laura Webb, Partner / Okos Partners There are over nine thousand wineries in the US selling countless brands. Pushing this ocean of product through the chaos of a quickly changing and ever-consolidating distribution network poses monumental challenges for all suppliers and distributors alike, even the largest and most-disciplined. For large suppliers, like in other categories, scale offers a major advantage because they can command attention from and wield considerable control over their distributors. But what if you are a boutique winery? Or a small brand within a larger supplier’s portfolio? If you are one of these, you likely feel helpless and frustrated by your distributor’s complete lack of time and attention. This feeling of helplessness is akin to visiting a foreign country where you don’t speak the language – the signs are unfamiliar, and communication and understanding are a challenge at best. That’s because wineries sell products to consumers – intimately crafted wines and the experiences they conjure. Distributors sell services – B2B warehousing, logistics and credit services. The two couldn’t be more different. Accepting and addressing this difference in the following three ways could set you apart as a small player in that distributor’s big pond of products.
Flip Your Perspective When thinking about their products, suppliers have a tendency to believe, “If we just make our distributors understand how our products are unique/better/special, then they could optimize their business and help us achieve our goals of reaching many consumers.” Viewing the world in this way – what is best for us – is taking an Inside-Out approach. In order to sell their experience outside of direct-to-consumer programs, suppliers must first think of their distributor as a customer. They can’t just create value for their end-consumer. They must create value for powerful stakeholders in their supply chain. Rather than trying to find all the ways to more efficiently pull customers through to their own view of the world
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(Inside-Out), success is far easier to achieve when suppliers focus on how well business processes align to target the supply chain’s buying processes, using an Outside-In approach. Consider: Which of your goals, if any, are focused on understanding and meeting your distributor’s needs?
Check Your Assumptions It is worth repeating – in order to sell their experience outside of direct-to-consumer programs, suppliers must create value through a supply chain that includes that “all powerful” distributor. In order for the distributor to move that product to a market of hundreds of thousands of on and off premise accounts, the supplier must supply, in addition to a product, a RELEVANT reason for the distributor to engage fully in that effort. Otherwise the supplier fails to reach the market and the distributor is stuck with dead product. Mid-sized and small brands complain about the difficulty of getting distributor focus when the big brands and suppliers in a distributor’s portfolio are always hogging the spotlight. With a portfolio of thousands of SKUs, you will likely find competitors just like you offering a wine with the same price, variety, appellation, and case incentive. Yet some of these brands and suppliers still receive more of the distributor’s attention. Why? And have you ever asked them? Consider: How many brands your distributor is selling just like yours. Do you know which are getting distributor focus and why?
Open Your Mind Many suppliers view distributors as a necessary evil. After all, you’re likely paying your distributor upwards of 25% of your margin to sell your products. Shouldn’t that be enough to get a little attention? The challenge is, that despite the craft and the story that goes into wine, it is no different than every other product that goes through
a distributor – food products, industrial products, or electronics. There is almost always a long tail of products in the distributors portfolio made up of an endless list of goods they are paid to sell after they take care of their top 5-10 brands. Our challenge is when we view something as a necessary evil, or put another way, when we don’t particularly like someone or something, we have two reactions – we ignore them or we confront them. Neither makes for a particularly fruitful relationship of dialogue. Imagine you have a meeting scheduled with your distributor. You come to the meeting angry as you have been busy creating great wine and running a great tasting room, and yet the distributor’s performance has been lackluster. Your plan, naturally, is to grill them and get commitment on what they will do to turn performance around. And, naturally, you will get one of two responses – the shutdown or superficial appeasement. When we are jaded by disdain and frustration, building relationships becomes really hard.
The following three questions, perhaps uncomfortable, are a guide to help you break this cycle and change the tenor of your conversation. If you open your mind, you may just be surprised by what you hear and learn that could improve your relationship and the results you have with your distributor. Consider: • What distributor interests do you consider in your business decision-making? • What would you need to know or believe in order to trust your distributor’s perspective? • What would a mutually beneficial relationship with your distributor look like? By continually asking, and answering these questions, you both raise awareness and identify barriers between you and your distribution network. Furthermore, by raising your “Outside-In” awareness, you begin to discover possibilities that can differentiate your business and create demand through the distributor.
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SESSION 6
The Changing Nature of Market Visits Session Overview: Market visits are costly and require tremendous time on the part of the supplier and distributor reps. When not done right, they can often leave both sides feeling frustrated and disenfranchised. Yet, when executed properly, they can be the single most powerful investment for a supplier. To make matters more complicated, in many cases, market visits are limited or not encouraged at all. As a supplier, however, maintaining a presence in the market is essential to success... so what can you do? This session walks through your role as a supplier and how you can better prepare for market visits, and conduct ride-withs, differently than you have in the past, in a way that builds lasting advocacy for your brand within the distributor sales force. The session will also address other, innovative ways to leverage technology to maintain a market presence without the trip.
Moderator:
Laura Webb Partner / Okos Partners
Speakers:
Juliana Colangelo
West Coast Director / Colangelo & Partners
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Jim Sweeney
Director of Sales & Marketing / Humboldt Distillery
Jeff Roth
VP of Supplier Development / Breakthru Beverage Group
NOTES What did you hear in this section about…. Your distributors’ needs? (POSITIONS)
Why do these needs matter to them? (INTERESTS)
What ideas did you hear to address their interests? (IDEAS)
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SESSION 7
Planning for the Future: Success Is Not an Accident Session Overview: Distributor planning is a complex process wrought with challenges that can leave suppliers and distributors misaligned. This session walks through the ins and outs of distributor and market planning that is timely, meaningful and creates alignment with you and your distributor. Speakers will discuss timing, preparation, agreements and follow-up so you can approach the process more prepared and primed for success in the coming year.
Moderator:
Laura Webb Partner / Okos Partners
Speakers:
Dan Hoban
SVP Wine Sales & Strategy California / Young’s Market Company
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Keith LaVine
Director of Sales & Marketing / Disruption Wine Company
Chris Lynch
Senior Consultant / Palmateer Consulting
NOTES What did you hear in this section about…. Your distributors’ needs? (POSITIONS)
Why do these needs matter to them? (INTERESTS)
What ideas did you hear to address their interests? (IDEAS)
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Action Planning Worksheet 1. What outcome do you want to achieve to improve your supplier-distributor relationship? 2. How will you and your team achieve this? 3. What is the work that needs to be done? 4. What resources are required?
Desired Outcome:________________________________________________
Strategy #4
Strategy #3
Strategy #2
Strategy #1
Action Plans #1
Action Plans #2
Action Plans #3
Action Plans #4
Step 1 Step 2 Step 3 Resources ©The One Page Business Plan Company
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NOTES What did you hear in this section about…. Your distributors’ needs? (POSITIONS)
Why do these needs matter to them? (INTERESTS)
What ideas did you hear to address their interests? (IDEAS)
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GLOSSARY OF TERMS ABC. Alcohol Beverage Control or other name of a state agency that is responsible for regulating the production, sales and distribution of alcoholic beverages.
Counter card. Free-standing card advertising a brand or promotion, placed on a counter near the cash register at an off-premises account, typically measuring 8 ½ x 11 or 8 ½ x 14 inches.
ABV. Percent alcohol measured by volume.
Cross merchandise. Display of wine together with another, non-wine product. See also: cross promotion.
ABW. Percent alcohol measured by weight. At-rest law. State law that mandates wine be shipped and stored at a licensed wholesaler for a minimum amount of time prior to delivery to a retailer. Initiated to eliminate producers shipping directly to retailers while utilizing the wholesaler for billing function only. Bill backs. Items previously agreed to by the producer, which are billable to the winery by the distributor. Brand manager. Distributor employee who is responsible for a particular brand or winery. Broker. Agent who arranges distribution for a winery – Often is also responsible for sales and marketing function. CFR. Code of Federal Regulations. Book of federal laws. Volume 27 (27 CFR) covers alcoholic beverages. Call frequency. The frequency in which a distributor visits a retail account. Case equivalent. Unit of measure equal to a case of wine or 12- 750 ml. bottles. Control state. State where alcoholic beverages are sold by the state rather than by wholesalers. Cost of goods. To a food and beverage buyer at a hotel: Cost of item as a percent of total price charged to consumer.
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Cross promotion. Promotion of a brand together with another, non-wine product. See also: cross merchandise. DI. Days inventory. The number of days worth of inventory available in a distributor’s warehouse based on its average sales. Depletion allowance. Sales incentive program based on depletions. Program crediting distributors by a set amount for depletions during a set period of time. Depletion report. Report generated by distributors on a monthly basis that tracks sales and inventory depletions. Generally contains the beginning inventory, purchases, ending inventory, and depletions. Depletions. Total number of cases sold by a distributor to retailers. Reported depletions excludes product loss due to breakage, products given away as samples, or any other non-income generating movement of product. Distributor incentive. Incentive provided to distributor in return for achieving predetermined sales goals. Dock sales. Sales of wine directly from a winery to a retailer, allowed only in certain states. Door talker. Promotional signage, mounted on door of cooler or refrigerator,
often used by retailers of wine, wine, and other alcoholic beverages. Drop charge. Fee charged by trucking company or trucker for each stop to unload. Dry shelf. Non-refrigerated shelf. End cap. Display of wine, usually stacked by the case, at end of retail aisle. Generally, highly valued retail placement. End display. Display of wine, usually stacked by the case, at end of retail aisle. Generally, highly valued retail placement. FET. U.S. Federal Excise Tax. FOB. Freight-on-board, i.e., the price with shipping charges not included. Flagship brand. Largest-quantityselling brand. Floorstack. Cases stacked on a retailer’s floor, numbering anywhere between 5 to 60 or more cases. Franchise state. State in which a franchise law in place that specifically protects beverage wholesalers from producers arbitrarily terminating a contract or working relationship. Gross profit. Absolute dollar profit; difference of sales price and total laid-in cost. Hand sell. Face-to-face selling. This can include a winery representative talking with a wholesaler, or a winery or wholesaler representative promoting a brand by personally visiting retailers and/ or talking directly to the consumer.
Kick-off meeting. Meeting usually held at wholesaler’s office during which the proucer discusses a new product, incentive program, or promotion with the wholesaler’s sales team.
POP. Point-of-purchase materials.
Laid-in cost. Sum total of cost of wine to distributor, including (1) FOB price at winery dock, (2) freight charge, (3) tax, and if applicable, (4) state redemption charges.
Placement. Sale of wine to a new account.
Less than load (LTD) shipping. Long haul shipping of less than a full truckload. More expensive method of shipping (about twice as much, per unit) compared to a full truckload. Line extension. A new brand introduced by a winery that represents a variation of differently flavored version of one of its existing brands. Major brand house. Distributor whose largest supplier is one of the top three major U.S. Producers. Margin. Profit percentage based on the sales price. See also: cost of goods, markup. Markup. Profit based on cost. Sometimes confused with margin. See also: cost of goods, margin. Master distributor. Distributor that buys wine from a winery and then resells it to one or more licensed wholesalers who then sell to retailers outside the master distributor’s territory. Merchandising (retail). The combination of cooler placement, stock rotation, and placement of point-ofpurchase materials. Mind share. Degree of focus upon or attention devoted to a wine or group of wines by a distributor. Off-premises account. A grocery store, liquor store, package store or other retail establishment selling packaged wine. On-premises account. A bar, restaurant, or other establishment that sells wine for on-site consumption.
PTC. Price to consumer. PTR. Price to retailer.
Point-of-purchase. Refers to promotional items such as cards, posters, coasters, stickers, etc. placed in a retail environment. Syn: point-of-sale. Point-of-sale. Refers to promotional items such as cards, posters, coasters, stickers, etc. placed in a retail environment. Syn: point-of-purchase. Post-down, post-off. Temporary price reduction for one or more brands in which a posted price, paid by the retailer, is “posted down” or “posted off.” Price card. A cardboard point-of-sale item featuring the winery’s (or brand’s) logo and a large white space for writing in the price or sale price by retailer. Price posting. Notification to the state liquor control agency, in writing, of the selling price to the wholesaler and/or to the retailer as required by some states. Price posting regulations also require advance notification of price changes. Price sheet. Sheet listing the brands in a distributor’s portfolio and the corresponding prices.
SKU. Shelf- or space-keeping unit. Each different package of the same brand constitutes a separate SKU. Sales program. An individual effort aimed at adding new accounts or increasing sales in existing accounts. A focus on a new product introduction A calendar of all efforts organized by the winery or by the distributor for increasing placement of both existing and newly launched brands. Sales support. Generally promotional items such as table tents, posters, coasters, cards, or signage. Sample allowance. Allowance for distributor to give away samples of a new brand or line extension. Set. Grouping of wine brands or chart of facing by SKU together in a cooler or retail display. Shelf placement. Specific location of wine on retailer’s shelf. Shelf strip. Promotional item designed to fit exactly within the width of a standard grocery, liquor store, or package store shelf, with a lip on the top and bottom, and space for the retailer to add information. Shelf talker. Shelf-mounted promotional signage often used by retailers of wine, beer, and other alcoholic beverages.
Primary source law. Law that mandates a winery ship to a licensed wholesaler.
Slotting fee. Fee paid to retailer in exchange for shelf space. Currently illegal in the alcohol beverage industry, although permitted in the retail food industry.
Promotion schedule. Schedule for promotional events and/or discounting for a winery’s brands.
Static stickers. Non-adhesive point-ofsale item that sticks (or clings) to window of a wine set.
Ride-along, ride-with, rider. The activity of a winery representative spending a day with a distributor’s salesperson on the daily delivery route in order to visit accounts and assist in promoting the winery’s brands directly to retailers.
Territorial agreement. Written agreement, required by the State Liquor Control Agency in some states, defining territory in which an assigned distributor can sell a wine brand. Well position. On retailer’s shelf: Lowest shelf in an open cold set.
Route book. The distributor’s call list of customers, organized by days and weeks.
3-Tier Wine Symposium
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EXHIBITOR RESOURCES MANAGEMENT George Christie - President & CEO Tami Christie - Vice President OPERATIONS Nick Young - Senior Director of Operations Samantha Stephey - Project & Events Coordinator MARKETING Buffy Schaezlein - Director of Marketing MEDIA - EDITORIAL Kim Badenfort - Editor, Wine Industry Advisor SALES Adrian Tamblin - Director of Business Development MEMBER SERVICES Kim Badenfort - Director of Marketing Services & Membership Stephanie Lozinto - Membership Coordinator Kimberly Pascale - Membership Coordinator WIN CORPORATE OFFICE 155 Foss Creek Circle, Healdsburg, CA 95448 Phone (707) 433-2557 • Fax (707) 433-2551 COMPANY WEBSITES Wine Industry Network www.WineIndustryNetwork.com WIN Advisor www.WineIndustryAdvisor.com WIN Expo www.WineIndustryExpo.com Wine & Weed Symposium www.wine-weed.com 3-Tier Wine Symposium www.3tierwine.com WIN Jobs www.WineIndustry.jobs WIN Data www.WineIndustryData.com
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3-Tier Wine Symposium
ASE Wine Foundations Burbank, CA 91506 215-240-6020 www.AmericanSpiritsLtd.com Cintas Santa Rosa, CA 95407 707-636-4966 www.cintas.com Concierge Alliance.com Yountville, CA 94599 707 287-2268 www.conciergealliance.com LibDib San Jose, CA 95119 (408)769-2129 www.libdib.com Linked MSP Santa Rosa, CA 95406 833-546-5336 www.linkedmsp.com Okos Partners Napa, CA 707.252.8880 www.okospartners.com Tradeparency Napa, CA 94558 305-394-3275 www.tradeparency.com
Exploring the Collaborative & Educational Opportunities that Exist Between the Wine & Cannabis Industries.
AUGUST 8 TH, 2019
REGISTRATION OPENS IN MAY
SANTA ROSA, CA
V IS IT : W IN E-WEED.COM
3 Educational Tracks that will cover Winemaking & Production, Sales & Marketing, and Winery Management & Operations To Get Updates on Registration, Conference Sessions, & Special Events at the Show, visit wineindustryexpo.com
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