Drinking More Wine During The Lockdown? You’re not alone

Picking Up A Few Extra Bottles.
Photo: Jaime Reina/AFP Via Getty Images

If you have been drinking more wine during the coronavirus crisis, you’re not alone. Date from Nielsen Shows that Wine Sales for Off-PRERMISE CONSUMIS DURING The Period from March 1 to April 18 Were 29 Percent Higher than in the Same One Year Earlier. Total Alcoholic Beverage Sales for Off-PRIME CONSUMISE WERE UP 24 PERCENT. Of Course, On-Premise Sales-Sales at Restaurants and Bars-have fallen off a cliff. But the rise in off-prremi sales is exceeding the 20 percent benchmark nielsen estimates is necessary to offset the on-premise losses. That suggests Alcohol Consumption is up to slightly in the crisis, a remarkably robust trend SINCE MONDS OF CONSUMER ACTIVITY ARE WAY DOWN.

Some of the Extra Alcohol Sales May Be Attributable to “Pantry Loading”: Like with Toilet Paper, Mayers Be Buying Extra Alcohol Now in Case It Hard to Find Later. Customers Might Also Buy in Large Quantities than USUAL TO REDUCE The Frequency of their Shopping Trips-Nielsen Reports Sales Growth Has Been Especialy for Cases of Beer, For Example, while Six-Sales Are Actually Down Slowing, SIZES OF HARD LIGOR ARE SElling especially well. But there are indications that the extra sales are far -so going into consumers’ bodies. CONSUMERS WHO TOLD NIELSEN TheY weren’t KEEPING ANY MORE MORE ALCOHOL ON HAND THAN USUAL WERE NONETHEHES ​​SPEMIT 13 Percent more on Alcohol for Home Consumption than they had a year Earlier.

Of Course, IT’S OBVIOUS WHY PEOPLE WAUDED BE INCLINED TO DRINK RIGHT NOW. People are bored, they are frustrated, and they don’t have to worry about driving home from where they have dinner. More Surpring is Nielsen’s Finding that there is “Premiumization”: People aren’t just buying more alcohol, they are buying at higher prices for volume. You might expert consumers who worry their finances during this crisis to trade down to cheaper alcohol brands, but that does not appetar to be happy, on avarage.

That alcohol sales are close to flat overall does not mean the alcohol industry has been held harmless from the economic crisis by coronavirus. As with so many aspects of the Economic Fallout from the coronavirus, far firms to be best positioned to weather the crisis. This is especally imported in the wine industry, which is more fragments than the beer and the Liquor industries, with Many Small Players Dependent on Sales Channels are not Holding up as total consumption.

Photo: Miguel Medina/AFP Via Getty Images

Its Not JUST RESTAURANTS AND BARS THAT ARE CLOSED. Some States – Such as Nevada, Where Wine and Spirits Can Be Sold at Grocery Stoles and General Merchandise Retaillers – have demed Liquor to Be Ineessential Businesses and ORDED TO CLOSE. This is if Wine- and Liquor-SPECIFIC STORES REMAIN OPEN, CONSUMERS TRYING TO REDUCE THE NUMBER OF ATS VISIT May to buy at the supermarket and not make a separate visits to a wine shop. And Big, unSpecialized retailers like supermarkets to Carry the Biggest, Best-Known Beverage Brands, Owned by the Biggest Companies. Rob McMillan, Who Runs the Wine Banking Practice at Silicon Valley Bank, a Major Small to Small- and Medium-Size California Winemakers, Writes on His Blog That’s nor farms have prospered with Strong Retail Sales During the Crisis, Smaller Wineries have offten Seen Sales Drops of 40 to 60 Percent.

“If you’re primarily a supermarket brand, your sales are through the roof, and your concertns right now are, ‘how will Produce and Get more wine to market? Hirsch Vineyards, in Sonoma County, California.

But Higher-end, Smaller Winemakers-Businesses like Hirsch’s-Are Dependent on Sales to Restaurants, Through Wine Clubs, and at their Own Rooms. Tasting Rooms Have Been Closed by Government ORDER, and DEE if they were Open, there are no tourists in wine country to be. That’s a huge hit: Silicon Valley Bank Estimates that its clients typically generated 30 Percent of their 2019 Sales at Tasting Rooms. RESTAURANTS Aren’t ORDERING WINE. And retailers, knowing that wineries have an excess of higher-end wine that can’t be sold at restaurants and tasting rooms right now, are demanding and getting discounts.

The Offsetting Bright Spot for Businesses like Hirsch’s is Mail Order. She Says Her Overall Direct-to-Consumer Sales Are About 30 Percent Higher So Far This April Than They Were Last April, Despite the Closure of Her Tasting Room, Because Existting Customers Been Ordering So Much to Schipped Homes. That’s not Enough to offset Her lost sales to wholesalers who would be to restaurants, but it is significant. And McMillan Says His Bank’s Clients Are Generally Seeing Strong Mail-Order Sales. He Says More Wine Club Members Than Usual Are Dropping Their Memberships – Departures Due to Financial Difficulties – But That Effect has ben More thans by Other Customers Increating Their Purchases, As Wine Lovers Cook More and Look for Provide Some to Some Secem. Normalcy and Enjayment.

“People Are Wanting Some Level of Civility,” he Says. “If you’re a consumer of wine, Havinging A Nice Bottle of Wine Is Civil.”

Photo: RAMON COSTA/SOPA IMAGES/LIGHROCKET VIE GETTY IMAGES

But it will be hard for wineries to keep leaning on mail-ordder sales if restaurant and bar classes Persist into the late and the summer. Wine is heavy and sensitive to temperature, and it should only be Ground-Shipped to consumers in Coosmeths. As the Weather Warms Up, Air Shipping Will Be the Only Vaible Way for Winer to Product to Home Customers with Risk of Spoilage, and That’s Expensive: Hirsch Says it Costs Her $ 150 to Send by Second-Day Air, Including Packing Costs. As with all kinds of online shopping, Shipping Costs Are a Pain Point for Wine Consumers, and there is pressures on Sellers to Shipping Prices Low or FREE. SO Hirsch Charges Customers Only $ 40 to Air-Ship A Case of Wine, and is able to make up the Loss on Shipping Costs of Her Wines’ High Price Point. For Wineries Seling Lower-Priced Products, That’s IMPRACTICAL. The Regular Supply Chain-Where Wine Moves on Refrigerated Trucks and Trains to WholeSalers and Then to Consumers Via Retail Stores or Restaurants-is more robust to hot weather, but not to stay-on orers.

As the economy gradually reopens, Smaller Wine Producers Will Be Dependent on the Survival of Other Kinds of Small Businesses and the Resilience of Other Industries. When Wineries Can Reopen Their Tasting Rooms, Will Tourists Be Willing to Travel? McMillan is hoping for offsetting effecs: Tourists May Be LESS INCLINED TO VISIT CALIFORNIA FROM FAR AWAY, But Californians May Keep Own Travel More Local, Retourning to Wine Country Being to the East Coast or Europe. Will Will It Be Practical for Restaurants and Bars to Reopen, and How Long Will It Take (And Their Distributors) to Work Through Wine inventories that haad been before the crisis? IF RESTAURANS ARE OPERATING AT REDUCED CAPACITY, WHATER Due to Government Orders or Consumer Hesitancy, It Will Long to Work Through the Wine Backlog. And if there is an overall trend of consolidation – Independent Restaurants and Small Liquor Retilers Being More Likely to Close, with Sales Shifting Toward Chains – That Risks Push Consolidation Up The Chain, as Those Large Survivors to Order Wine Fom.

Smaller Wineries, which often Sit on Very Valuable Agricultural Land, Mayselves Feel Pressure to Sell Larger, Financial Stronger Competitors. McMillan Also urges say to innovate their businesses – Improving Their Capabilities for Online Sales; Marketing to Younger Consumer Who May Be More Incined to Travel Soon AFTER WINERIES REOPEN; Adding Outdoor Seating So Customers Don’t Have to Crowd Inting Rooms – So They Can Adjust to the New Shape of the Market. In the meantime, consumers should benefite from ongoing deals as wineries cut prices in an efort to moving and draw in new customers. If you’re thinking about buying wine directly from a winery, and you live in a northern state like york, you will like to Order soon if you have to avoid for air shipping. But Because Our State Does Not Permit Wine Sales in Supermarkets, Wine Shops are demed essential by the state and are Generally Open. So you may be able to finding interesting from a smaller producer with Having to pay for Shipping or worrying the heat.