Opportunities for Wineries Post-Lockdown

During the lockdown we've seen wine sales via shipping go up by triple digit amounts and retail sales, mostly in grocery stores, go up by double digits. Counteracting that is sales via the tasting room is near zero other than wine clubs.

As wineries open under new rules how can they maintain the good while gaining back where they've lost? Well, ain't that the million dollar question.

Shipping direct to consumers

Many think this huge spike in sales is a very temporary thing like people stocking up on toilet paper. The key question may be, how much will people continue to eat dinner at home after restaurants open up? The dining establishments won't be operating at their previous capacity and even at half-capacity it's conceivable that many people will not risk going out very often. So what could be the restaurants' loss may be the wineries' gains because if you're eating at home you'll continue to buy wine for home consumption.

Wine through retail outlets

This channel may also continue to grow if people keep eating at home. Grocery store wines could be in for continued sales gains. Unfortunately, not many wineries can play in this area and it's mostly the big ones like Gallo and Constellation Brands. Constellation could be in great shape as they own a hundred alcohol brands including Mondavi and Kim Crawford wines, Corona and Pacifico beers, and Svedka vodka. Yeah, a lot of stuff you see in your local Safeway or Kroger.

Winery tasting rooms

Like restaurants wineries will be operating at less capacity. One of the things about having fewer people with seated tastings is the dollars spent per person is higher than with drop in visitors standing at a bar. For now at least tasting will be seated and by appointment so it seems there will be more money spent per visitor though there will be maybe half as many. The new visitor capacities will vary widely by winery. Some have always done seated tasting so not much will change. Other wineries used to bring in busloads of tourists.

A question with wineries as with restaurants is, will people flock back to the tasting rooms or will they not want to chance it? There won't be many out-of-state tourists so wineries with a large nearby population like Sonoma and Napa should be should be better off than some other areas.

Wineries should be looking at expanding outdoor seating areas to allow more folks. Hopefully, the agencies that regulate alcohol consumption will ease up and let this happen. In the Bay Area restaurants and being allowed to use sidewalks and even street parking spots for tables to expand their business. I think this is a very good idea as one concern I have with reopening the country is that when you put unmasked eaters and drinkers indoors with circulated air you may find the perfect opportunity to spread the virus. Having outdoor seating, as long as the weather is good, is likely to be the safer option.