Sherry-Lehmann’s Adams Optimistic About High-End Wine Business

　　Sherry-Lehmann Wine & Spirits, the 77-year-old retailing powerhouse in New York City, has enjoyed steady growth in the wake of the recession and continued success of its Bordeaux business after Diageo pulled out in 2010. Led by CEO Chris Adams, who was also named chairman in November 2010, the Manhattan institution totaled $44.5 million last year, and Adams says sales were up 13% in the first half of 2011. Shanken News Daily recently spoke with Adams to discuss current retail trends and Sherry-Lehmann’s outlook for the future.

　　SND: What changes have you seen in sales this year?
Adams: There has been a perceptible trade-up happening for us. In 2008 and 2009, we saw customers trading down: buying sparkling wines instead of Champagne, buying petite chateau Bordeaux instead of cru classé. And the 2009 Bordeaux futures campaign in the summer of ’10 sort of marked a point at which the customers felt like they could spend more money. And then that was brought home even more so in the fall of 2010 and into the holidays when we saw great Champagne sales. So there’s reason to be optimistic. For a long time it was cautious optimism, but we’re feeling much better this year than we have for the last few.
SND: How do you feel about Bordeaux’s 2010 vintage?
Adams: I’m concerned with 2010 on two fronts. One is that there is higher international demand than there’s ever been. And then we’ve lost quite a bit on currency. Having said that, we’re seeing that there’s less wine being made available to the market, so that increases the demand for what is available. At many points it becomes for the consumer a chance at access. Price becomes not completely secondary but it’s two functions: 1) Can I even get the wine? And 2) If I am getting it, where is that price relative to the market? And our position is that we’ve been doing Bordeaux futures since the 1959 vintage so we have a track record of being able to offer these wines. We feel that America should still be an attractive market and that Sherry-Lehmann should be the place that customers go to get these wines.
SND: What other trends are you seeing in lower-tier wines or in general?
Adams: We’re seeing strength in New Zealand Sauvignon Blancs. Argentine Malbec for us is still a growth category. Our private label there is Miguel Mendoza Malbec made by Enrique Foster. And we’re still seeing a lot of people following these wines at the $15-to-$20 price point, especially in the warmer weather. We’ve had great success in the past year with the 2009 Beaujolais. There are some benchmark wines made there, and as soon as I bring a container in, I find myself ordering another a few weeks later. So it’s nice to see the focus on affordable fresh wines still there.
SND: What regions do you sell the most of?
Adams: Most of our sales are from France—Bordeaux, Burgundy, Champagne. Obviously, we follow the Rhône, Loire and Alsace as well. And then after that we sell a lot of wines from California. Even in the down economy, we were able to position our offerings from California to meet the right price points. And then of course Italy, Spain, Germany, Chile, plus South Africa is coming back a little bit.
SND: Spirits account for roughly 5% of your sales. Where are you seeing growth in that category?

　　Adams: We’re seeing a trade-up there as well. People are spending a little bit more on their vodkas and whiskies. When we moved into our current location (in 2007), spirits became a growth category for us but it’s leveled off. There’s still a little bit of growth, but it’s not astronomical like it was when we first moved here.
SND: How do you feel about wine being sold in grocery stores?
Adams: We don’t believe that it’s the right thing. And for me it’s a matter of, you can’t just suddenly change the rules and tell people that all the business models they’ve built for decades or years are no longer applicable. It just doesn’t seem that any proposal I’ve seen for wine in grocery stores deals effectively with the people who have existing businesses. Is it impossible? I’m not going to say that, but they haven’t shown anything (that seems fair).
SND: What are your plans for the future? Are you still considering opening new stores?
Adams: Now that the economy is getting brighter, there are a few things I’ve been thinking about. I can’t disclose too much, but yes, we’re interested in positioning this store outside of New York state the way it should be positioned. I’m taking it quite seriously. I hope that we can do something in the next 12 to 18 months. I’m optimistic that it can be fulfilled.

Tampa-based wine maker Paul Clear believes the best Florida wines come from … Spain.

A list of most improbable career choices in Tampa might include snowboard instructor. Mountain climbing guide should rank up there, too. Winemaker would definitely make my top five.

Yeah, yeah, I know there are locally made wines. But (how do I say this nicely?) — they suck.

Paul Clear's Tampa-based Terroir Wine Cellars wines certainly don't suck. That's because his wines are not made in the Sunshine State. Try Spain.
You see, Paul is what you'd call a negociant, a fancy French term for someone who typically owns no vineyard or winery but who arranges (negotiates) to have other folks make it for him. In Paul's case, those folks work for a very special winemaker in a tiny town in southeastern Spain called Albecete.

Now before you think Paul is some South Tampa dilettante who's dabbling in wine making, you should know that he's a guy who's been working around wine since before he could legally drink it. His first taste of the wine business was stocking shelves at a local wine shop just out of high school in Buffalo, New York. Hardly a glamorous gig. But the more Paul learned about what was in all those bottles, the more he wanted to learn.

A stint as a regional wine sales rep soon led to consulting jobs with high-end wine shops around the country. Tapped by wineries for his nose for business and wines, he found himself preferring to hang out with the winemakers instead of those in the front office. More than a decade later, Paul not only knew the wine biz — he knew what makes a great wine.

Which is just what he decided to do eight years ago. His goal: Make great, affordable, wines.

A lover of Spanish wines, Paul knew the only way to find the right winery was to walk the vineyards, talk with the winemaker and taste the wines. Three trips to Spain and visits to more than 120 wineries later, Paul drove up one day to a small winery in the town of Albecete in his ludicrously puny rental car.

As soon as he tried the wines, he knew he'd finally found what he was looking for.
"I fell in love with the winery right then," Paul said recently at South Tampa's CRU Cellars, where he shared some of his wines. He moved to Tampa five years ago, and since then the portfolio of wines he makes and imports through his Terroir Wine Cellars has grown from one to nearly a dozen, sold in more than 20 states.
His first, Palarea Tinto 2005, arrived in the U.S. last year. "This one's my baby," Paul said. "It's wonderful."

After tasting it myself, I'd agree. Made from a blend of hand-harvested cabernet sauvignon, merlot and syrah, it's a bold wine. One that'll stand up to anything your grill can throw at it. You'll also taste some smoke, lavender and rosemary it in. And like all of his wines, it's light on your wallet, at only $16 a bottle.
His Palarea Merlot 2006 ($15), spicy and jammy, will make you rethink long-maligned merlot.

A sparkler, Grand Pasion Brut Reserva, is fruity and light. Lovely. And at around $10 a bottle, it's criminally inexpensive. It's now his most popular wine.
He's also just begun importing Grandalla Gran Reserva 2004. He showed me one of only 30 bottles in country. As decorated with awards as a five-star general, this one carries a price tag to match ($125).

Paul's also begun importing Spanish wines made by a pal. Organic and biodynamic, Lobetia brand wines are, like his other wines, very good and affordable ($10 to $16). In other words, perfect for every day.

The Lobetia Chardonnay 2010 was zingy and fresh. The Lobetia Viognier 2010 was nicely floral, with tastes of nuts. The Lobetia Tempranillo 2010 was dry and tasted of strawberries. I also enjoyed the plums and bacon (honest) in the Lobetia Syrah 2010. I especially liked the Lobetia Tempranillo/Petit Verdot Roble 2010 blend, big and juicy.

I'm drooling just typing this.