By Cheryl Durzy
I was lucky enough to be invited to speak at the recent Wine Industry Network’s 3-Tier Wine Symposium. This was the first event of its kind, which to us further indicates the real need in the marketplace for more 3-tier options and support.
At the event, I participated in a keynote panel with Jake Hegmann, VP of Legal and Regulatory Affairs at WSWA, and Philana Bouvier, Senior VP of New Business at Young’s Market (she fields 90 requests per DAY for new distribution).
The overall theme of the event: How do small and mid-sized wineries navigate the 3-tier system and their relationship with wholesalers.
Our kick off panel really set the stage. Jake talked about the current state of distribution. He spoke about how people talk about consolidation but in some states the number of wholesalers has actually grown. Because of the large player consolidation, a number of newer smaller wholesalers have started up, offering new opportunities for Makers of all sizes. With that comes different challenges. However it’s great to see that the industry is continues to evolve based on changing market conditions.
It was interesting for me to hear from other suppliers and wholesalers who spoke about their relationships. My biggest take-away was that to be successful in 3-tier distribution, wineries need to work. They need to be out in the marketplace, building their own buyer relationships and selling wine. That takes time, resources, money, and sales prowess. Believe me, I know, I’ve been there and used to do this for my family winery.
To simplify and make it really clear: Whether a Maker is with a big distributor or a small distributor, Makers need to be out there building their own buyer relationships.
An interesting quote from a distributor: “You are not selling to your wholesaler, you are selling through your wholesaler (to accounts).” Think about that. Who is ultimately your customer? In the end it’s the Reseller.
Another interesting take away was the discussion in regards to “Work Withs.” For those new to the work-with/market visit/ride-withs, read here for a good summary and be sure to continue on to the comments section to read the reps POV. I am paraphrasing here, but one distributor panelist said “Remember those days when you would get picked up at 9am, have a coffee and review your day with the rep? You would hit 8-10 accounts, end the day at Happy Hour and it was a great day. Those days are over.”
The best way to work a market with a rep these days? Review their account list, research the accounts and ask to get appointments with the top 3 your brand would do well in. Better yet, make those appointments yourself and then call an order into the rep. Times...they are a-changing!
There was also a lot of talk about meetings with distributors and how relationships matter.
Something else that was super interesting and is a paraphrased quote: “If you, the Maker, can’t sell it into an account, how is my sales team supposed to do it? We are not magicians.” You need to have a product that people want, is priced appropriately and has a story that, well, ultimately sells.
What is your differentiator? Are you unique, do you stand out from the crowd, or are you trying to be like everyone else with just one more gimmick.