Monday, June 11, 2012

Gallo Wines Buys Into Northwest Wines

Gosh!! I Love it when I’m right! I’ve been saying for years that E & J Gallo Company from Modesto, California was going to join the Northwest winemaking scene soon. It was only a matter of time until the Gallo family owned a piece of the Washington and Oregon wine biz.

Guess what got announced this week? You got it. The Gallo family purchased both Columbia Winery, and Covey Run from Ascentia Corporation. Ascentia, who also sold off their interest a couple of weeks ago of a couple of other northwest wineries to Precept Brands, must be doing some pretty stealthy capitalization because they are cutting loose some nice properties.

I’ve been a big fan of Gallo wines ever since I sold for them through Graybeal Distributing. Gallo is really a company that’s really got it together when it comes to making, marketing, and branding their wines.

The one thing that has always held the company back from true success in the northwest was that we are pretty proud of our own wines. In most cases it is nearly impossible to convince a person from this part of the world that a Californian wine would be superior to any rot gut from around here. Truly, wine in California or Europe is overall significantly better, and sometimes cheaper. But, we here in this region are proud of our own brands.

A couple of years ago Gallo started to really get it right. They looked at the success of brands like Ste. Michelle Wine Estates, and Precept Brands and realized that they needed to produce wines through other local labels like those companies do. Box and jug wines are way out of vogue and the Gallo numbers were dropping quickly.

Gallo started by picking up some big European brands like Gascon Malbec. Everything at Gascon stayed the same, but the ownership and money flow was different. Great wine at a great price.

Recently, before the big 1183 fiasco hit us here in Washington I picked up some booze to stock up. I picked up a bunch of New Amsterdam Gin. One of my favorites. The Lady at the store told me that they sold tons of the stuff. When I told her it was a Gallo product she just about passed out.

Now, with Gallo picking up stock in the northwest we are sure to see the lines get a lot more blurry. One thing I can tell you is that the Gallo distributors are going to see a huge increase in their numbers out of this.

Covey Run was founded in 1982 in Prosser, and was one of the benchmark wineries that kick started the Washington wine industry. Helen Willard, one of my good friends from the Prosser area started Covey Run as Quail Ridge with her late husband Leon. Helen still walks the vineyards of the winery every day with her dogs.
Columbia Winery started in the garage of Dr. Lloyd Woodburne in Laurelhurst, Washington in 1962. In 1979 they were joined by pioneer winemaker David Lake and the rest is history. Known as Washington’s first premium wine brand, the winery has grown exponentially through the years.

Congrats to all in this purchase. I know that both the winemaking staff, the founders, and the Gallo brand will be strengthened by this.


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