Education Improves the Bottom Line

Trumping whatever esthetic value a wine label may have, its main function is to impart information to the consumer. As such, the bottler (or producer, winery or winemaker), as well as the legal authority where the wine is sold, has an interest in shaping that consumer information.

For their part, the people who put the wine in the bottle want the consumer to buy it. Consequently, wine labels may contain visually attractive or eye-catching graphics or art; descriptions of how the wine tastes, how it was made, or what foods it best accompanies; technical information (pH or acidity level, for example, or wood aging regimen); or marketing terms such as “reserve” or “special selection.”

Neither any U.S. nor State government body regulates that body of information. For example, the word “reserve” has no legal standing and can mean anything from special treatment given to it by the winemaker, to something as thin as the ink with which the word is printed. (Contrariwise, foreign governments may prohibit such language on U.S. wines exported to their countries. The European Union, for example, forbids the word “reserve” on labels of American wines.)

U.S. Government requirements

However, wine labels also contain a substantial amount of legal content that is regulated by the U.S. Government, under the auspices of the Alcohol and Tobacco Trade & Tax Bureau (known as the TTB, an arm of the Treasury Department, known formerly as the Bureau of Alcohol, Tobacco & Firearms). The TTB not only oversees label language on wine produced in the U.S, but also those for wines imported into the U.S. and sold here. For example, the TTB requires that the so-called Government Warning (“(1) According to the Surgeon General …”) be affixed to all bottles of wine sold in the U.S. Consequently, French and Italian wine bottlers, for example, must add strip labels with the Government Warning to bottles of wine that they hope to sell in this country. Taken as a whole, though, the TTB regulations can provide helpful information to purchasers of wine. However, they do not describe the taste of the wine. TTB regulated statements may appear on the front or back labels of wine bottles.

The TTB requires the following information on all bottles of wine sold in the U.S. Parentheses contain one or two of several possible examples.

• Brand name: The wine’s identity, which may be a person’s name (Robert Mondavi) or a proprietary name (e.g., Big House Red).
• Wine type: The wine’s style (sparkling wine) or grape variety (Chardonnay, Merlot, etc.). If grape variety, the wine must be made of at least 75% of the grape named. Generic or proprietary names (Long Flat White) imply no specific blend of grapes, but the producer voluntarily may state a blend.
• Alcohol content: Any wine with more than 14% alcohol by volume must state the alcohol content (because the government taxes these wines at a rate four times higher than wines less than 14%).

For wines less than 14%, the label may state either the actual alcohol content or a designation such as “table wine” which implies an alcohol content between 7% and 14%. Many table wines are labeled simply “Alcohol 12.5% by Volume” because the TTB allows a leeway of 1.5% under or over the actual alcohol content for wines under 14%—for two reasons: evaporation during aging is not easily controllable, and the common measure of alcohol content, the Ebulliometer, is not entirely accurate (distillation is more accurate, but also more time-consuming).

• Name & address of bottler must appear, preceded by the words “Bottled by.” The address need not contain a street number

Either the term “Produced and bottled by” or “Made and bottled by” indicate that the bottler also fermented at least 75% of the wine. Terms such as “Cellared by,” “Vinted by,” “Prepared by” or “Blended by” indicate, by law, various treatments.

• Net contents of the wine, in metric measurement (750 ml).
• “Contains Sulfites” must be printed on labels of wines containing 10 parts per million of sulfur dioxide —or, another way said, most wines made.
• The Government Warning must appear on all wine labels. Optional information, also regulated
• Vintage date indicates the year in which the grapes that made the wine were harvested. If used, 95% of the wine must come from that year (the 5% leeway allows for “topping off,” especially of red wines as they age).
• Appellation of origin: California State law stipulates that the appellation “California” means that 100% of the wine comes from California. Federal and nearly all other State laws require that use of a State name means at least 75% of the wine come from the State so named. If a label states an officially designated viticultural area (AVA), the TTB requires that at least 85% of the wine come from the AVA so named (e.g., Napa Valley).
• “Estate bottled” is regulated to mean that the winery on the label grew 100% of the grapes on land that it owns or controls, and that it crushed, fermented, finished, aged and bottled the wine in a continuous process.

(Thanks Darryl for all the fantastic material!)

 Baseball Quotes – Business Lessons “Nice guys finish last” Leo Durocher The thought in baseball was that nice guys couldn’t win in baseball and for a long time this was the prevailing thinking in business. Not anymore! These days, companies routinely vie for the affections of their associates and customers. The winning companies understand this, which is why you routinely see the nation’s most successful companies on Fortune’s list every year. “Nobody wants to hear about the labor pains; they just want to see the baby” Lou Brock Your customers don’t care what you went through to have enough associates working or the right products on hand. They don’t care if one of your trucks broke down and now you’re late delivering stuff for their party. They just want to see results. Part of respecting that your customers have choices is meeting their tangible needs and getting these things right! “I know it is the fans that are responsible for me being here, which is why I try with each and every broadcast to serve them to the best of my ability” Harry Carey Words could not ring more true. The best companies understand that it is their customers (the fans) that pay their freight and help them meet payroll each week. Without your customers there is nothing; which is why you have to treat every customer like family. Just don’t ask them to borrow money   Key Principles for Retailing
Spend some time considering the following information this week: • Sweat the small stuff – What does your store look like?
Are you paying attention to the little details?
How about the restrooms?
If your customers (and employees – for that matter) use the restroom, you certainly want to make sure it is clean.
Are the windows clean?
The front door? The parking lot?
You know the story. Control what you can control. Handle what you can handle. Do your best.
When management takes care of the little things, it shows customers and employees that you care – and that’s a much better environment to build and maintain a thriving and healthy business that customers want to frequent regularly.
• Be dominant in at least one aspect of your strategy
Is it going to be price, service or selection? Is it more than one? It can be two attributes but no more than that.
Over the last several years (and certainly today) it has become imperative to be really good at one aspect of your strategy and not mediocre at all aspects of your strategy. Your goal is to win some category in your customers’ minds.
In other words, if you plan to have the most expansive selection of cabernets and the most talented team of people to sell that varietal, then it will most often spell disaster if you have the lowest prices.
Look at Costco as an example.
Yes, they have low prices but don’t have any salespeople to help select the perfect bottle of wine.
The reality is that having talented people and big selections are expensive to maintain. Therefore, having the right margin is imperative.
Do not try to be all things to all people and find some way to stand out.