Monday, April 15, 2013

Cabernets on a budget

With the cost of California Cabernets these days, I just can't afford to drink what I want on a daily basis. If you are like me, you need to be selective and find value for your dollar.   Let's look at why that bottle of wine costs so much.  Most states operate on what is called a three tier system: the winery, the wholesaler and the retailer. For the sake of discussion, let's take a bottle of wine selling for $50 in a restaurant. The winery sells it to a wholesaler; called a distributor for about $12.50.  The distributor then marks it up about a third and sells it to a retailer for about $16.50, plus freight and state taxes.  The retailer would then sell it for about $25 and the restaurant for double that charging you around $50.  The cost of that bottle for the winery to produce is about $10.50



For a $50 bottle of wine, within the three-tier system, here’s how it breaks down:
  • 7% – cost of grapes and/or growing ~ $3.50
  • 9% – cost of wine making ~ $4.50
  • 4% – bottles, corks, boxes, labels ~ $2.00
  • 2% – marketing ~ $1.00
  • 13% – sales people, distribution from the winery ~ $6.50
  • 3% – administrative costs ~ $1.50
  • 2% – interest ~ $1.00
  • 4% – taxes to government ~ $2.00
  • 5% – actual winery profit ~ $2.50
  • 20% – wholesaler markup ~ the people who get the wines to wine shops and/or restaurants ~ $10.00 (There are lots of overhead and payroll costs involved at this level)
  • 31% – wine shop markup ~ $15.50 (There are lots of overhead and payroll costs involved at this level)
The more often you buy a bottle of wine directly from a winery, the more profit there is for the wine company owners. Because there’s more profit, it allows for those with advanced social consciousness to take better care of their workers, and they do. This exists even more so if the wine company is also growing its own grapes.

Now that we know how the costs stack up, how did our selections of budget Cabernet Sauvignons fair?  Let's start with what we are looking for in a typical Cabernet Sauvignon  grape.  Cabernets are often called the "King" of wines.  They make big, powerful, age worthy wines; why?  Characteristically Cabernets produce high tannins, moderately high acids, and carry big pigments and phenolics.  This all adds up to big powerful wines with massive structure.  You should also be looking for aromas of:
                                       black cherry                              cedar
                                       vanilla                                       chocolate
                                       black and red  currants              pencil shavings
                                       herbs                                        tobacco
                                       blackberry                                black pepper
                                       mint                                          tea
                                       blueberry                                  eucalyptus
                                       toffee                                        coffee
                                       cocoa

When these wines are young, they tend to be deep purple in color, have more fruit components in their flavor profile and exhibit big dry mouth puckering tannins. This is often referred to as a "closed' style.  For those that have patience enough to store their wines for often a decade or more, the wines start to turn brick red in color.  The flavors become more delicate; coffee-toffee, fragrant cigar box, and the tannins soft and supple.  How you prefer tour wine is certainly a matter of taste.  For the sake of our tastings, this is why I will rate a wine drink now or hold for x years.  Sometimes we will even recommend a wine as a cellar selection.  It's all a matter of preference.  Check out our reviews on the Cabernets we tasted, taste them for yourself or even send us comments on what you thought of the wines.  May you have the good fortune of good wines and good friends to share them with!


... Tom Cook

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