Thursday, April 24, 2014

Wine Fraud and Lessons for You...Yes, You!

Some big names have been involved in some high profile cases regarding fake wine lately: Bill Koch vs. Eric Greenberg, Rudy Kurniawan duped lots of people (including Bill Koch) and more recently, Julian LeCraw, Jr. filed suit against an auction company.

So what, those guys are buying bottles worth tens of thousands of dollars that are decades, or even centuries old. What does that have to do with me? 

The lesson these collectors learned was that if something looks to good to be true, it usually is. Anyone can fall victim to scams, the Koch brothers are worth so much they can afford to stick their nose into everyone's business. A member of the Forbes family bought a bottle reported to be part of Thomas Jefferson's collection (read about that story in The Billionaire's Vinegar).
Smart people, taken in by charlatans.

Okay, okay, I get it..but what does this have to do with me?

You and I are unlikely to be shopping for 100+ year old wine or bottles priced at five figures each but this is still relevant. Hucksters and weasels will always exist. You should be aware of them.

Everyone loves a bargain but beware of closeouts and blowout sales. The wine business operates on lean margins, 15% to 30% is the norm. Larger markups are found but no one doubles or triples their cost like you sometimes see in clothing, for example. In department stores you see half off sales all the time, not so in wine stores. So, when you see deep, deep discounts be wary. Don't avoid entirely but be careful.

The online market is full of wild prices, I have seen a New Zealand sauvignon blanc advertised as low as $8.99 and as high as $19.99. Be sure to check the vintage if you're shopping online, especially with white wines. A sauvignon blanc for $10 that you see in your market at $15+ may not turn out to be a good buy if the vintage is two or three behind the current release. And that's before considering the shipping and handling, which can easily go beyond three dollars a bottle, or any return shipping/restocking charges should you try, and be allowed to, send unsatisfactory product back.

Also, if you buy remotely you can not monitor the storage temperature or the conditions during delivery. My experiences with shipping wine have been mixed. On most occasions the bottles have arrived in excellent condition but I had one experience involving bottles hot to the touch - I happened to be home when the delivery company brought them, in a non-air-conditioned truck. I, of course, refused the product.

People shop for deals all the time, myself included, but there is a point where I am more than happy to pay an extra dollar or two in order to insure either correct handling or an easy, local place to return subpar merchandise. I am especially sensitive to the shipping concerns living in a city where sunny and 80 degrees is possible pretty much anytime and 90+ degrees is a guarantee for months at a time.
When wine is exposed to heat, it takes very little time to damage it. Even locally it is wise to pay attention to the shop and how they care for their inventory. I was in the business a long time and I know some wholesalers load their trucks the night before and leave them outside overnight, even in the summer. Those same trucks leave for the day and are sometimes still delivering after 5pm. They are also rarely air-conditioned. Ever been in a truck helping a friend move in the summer? Then you know how fast those temperatures rise.

For a few years a place I used to work bought distressed inventory, heat damaged, from some very big names in Burgundy. The wines would be offered at about 40-50% off of their usual retail price. People snatched them up faster than it seemed possible. We told as many people as we could that they should drink the wines soon because they would not age well, due to serious heat exposure, but I'm sure some cellared their bargain treasures too long. The wines were tasty in their youth but were unlikely to stay that way.

The company also bought huge truckloads of closeouts from time to time, these shipments rarely included anything worth drinking at any price. The sales staff disagreed with offering these wines for sale but were told it was happening anyway. We did our best to discourage purchases when we could but people clung stubbornly to their "deal" over a similarly priced wine that was in great condition and tasted good.

After Katrina, I heard rumors of wine being sold off in bulk to south of the border destinations despite having prolonged exposure to extreme temperatures. Who knows if any disclosures reached the end consumers for those bottles.

Wineries sometimes have an off vintage where the wine simply is not as good as usual. They will sometimes dump that product into a market when the next vintage is ready to ship. You might find a relative bargain but will you like the wine?

There is no guarantee of perfection in your glass but it is a step in the right direction. There is an old axiom in the business, "There is no good wine, only good bottles" - meaning even two bottles purchased from the same case and stored identically won't necessarily taste exactly the same. Increase your odds of finding good bottles by shopping locally with reputable merchants...you have heard me say this before and you will hear it again.

All right, now I understand what you're saying...

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