Wine Industry Report for 2026

The Silicon Valley Bank's Wine Division puts out an annual report on the financial state of the American wine industry. The data comes from wineries returning a survey of their past year's performance. Their State of the US Wine Industry report is required reading for many in the wine business. Below are a few key points. Go here and click on Download Now to see the full report.

 

From Silicon Valley Bank's 2025 report

 

• There is an oversupply at the wineries, the wholesalers, and in retail. The excess inventory of high-quality wine will mean great deals for the consumer. 
  
  
• The rate of contraction of the market is slowing. That is, there is more decline in sales to come, but it's bottoming out. SVB predicts the low point will be reached in 2027 or 2028.
  
  
• The decline in tasting room foot traffic and sales has hit the smaller wineries the most.
  
  
• Wine prices have gone up substantially in the best five years and customers have inflation fatigue.
   
• For the past year, the top performing 25% wineries saw an 8% sales growth. The bottom 25% had a 10% decline. A worrisome 38% of wineries say their financial health is weak with 18% saying they are likely to sell their business within five years.
  
  
• Half of the wineries considered last year a bad year, 30% a good year, the rest were neutral.
  
  
• The under $12 wines took the biggest hit. Premium wines are doing okay. Premium is considered wines starting somewhere between $20 to $30. I'm not sure where SVB sets it.

 

Winery DTC Notes. (DTC is Direct to Consumer, not through wholesale). The bank talks about the following items. I don't agree with everything they said so some of this is my opinion.

Appointment-based tastings. 
This gives the sense of exclusivity, and that can work for smaller wineries. Many people seem weary of having to make appointments and stress out over getting to their next one on time. "Walk-ins welcomed if we have space" should be part of the message for most wineries that prefer appointments. Also, "Call us if you'll be more than 15 minutes late so we can save your spot."

Member exclusives. 
This can be for perks and for wine. Many wineries already do this. Just don't overdo it. One spot I visited last year had three county blend wines on their tasting list, with the other dozen "good ones" for members only. I decided to visit this winery because I'd read positive reviews of their wines. This isn't somewhere I want to visit again. Either their wine club is fully supporting their DTC sales, or they've made a mistake.

Food-pairing, and other experiences. 
SVB, along with others, say wineries need experiences like this to survive. Eventually we'll be oversaturated with everyone offering food parings? How do you make this different either in what's offered, how it's offered, or where it's offered. You can't just throw some salami and cheese on a board, set it up at the bar, and think you've created something that will draw people in. I'm not sure where this is going other than create another expense that will mostly affect smaller wineries.
A Cautionary Tale: When cruising Napa travel groups on social media, it's amazing how many future visitors ask for views and experiences, but never mention what varietal, style, or prices of wines they prefer. Do you want people coming in that have no intention of buying wine? If you charge $100 to taste, you can probably do this.

Investing in hospitality training.
Well, duh. It's just not sales, btw, it's customer service. Also, knowing about wine, local businesses, your POS, wine shipping and compliance, the laws concerning serving alcohol, etc. The first step is bringing in people who love to interact with other people. It shouldn't take a crisis to have this happen.
 

Items Directed at Owners, pricing and too many products.

Take a look at pricing for wines, tastings, merch, food. Then look at your customer base. Do they match? 

Does it make sense to offer sales all the time to reduce inventory, or would it be better to reduce the price of the two or three SKUs that aren't moving? Constant sales hurts perceived value. Use volume discounts to move wine. 

How many SKUs do you have? There are plenty of wineries where I get lost looking at all the offerings on their website. Three levels of wines with over a half-dozen in each with sometimes overlapping prices? It might be time to focus on what you do well and can sell. If you can focus, then the sales people can focus.

Before you go all in on the latest trends with food and entertainment, figure out how you are still going to keep the focus on the wine. Disneyland is about entertaining, tasting rooms are there to sell wine.