How the US Wine Industry Is Coping With COVID-19 Fallout

Matthew Spaccarelli and Casey Erdmann of Fjord Vineyards with their two kids Maggie and Leon

How different aspects of the wine community are adjusting and supporting each other during the global pandemic

The economic fallout of the pandemic has impacted every corner of the wine industry from growers, sommeliers, importers, consumers and everyone in between. This industry represents millions of people whose livelihoods around the world depend on the production and sale of wine. Each part of the community has been making adjustments to accommodate the changes in day-to-day operations caused by COVID-19. These tenacious and quick-thinking folks (along with their supporters) are finding ways to bust through this massive roadblocks, while also helping one another. It’s all for the love of wine—which has been deemed an essential product in these uncertain times.

All around world restaurants and bars have been forced to close, creating a ripple effect that has slaughtered the assembly line all the way back to the wineries. This has resulted in massive layoffs in every aspect of the business, and has winemakers and their distributors sitting on a lot more inventory than expected. Luckily, subscription services, retail shop demand, and staunch supporters of drink local campaigns have provided some flow of business. In fact, according to Nielsen’s COVID-19 data, off-premise alcohol sales are up 25%, with spirits and wine having the most success in growth—up 33% and 32%. 

A tale of two (of thousands) of wineries pivoting their businesses

Fjord Vineyards, a small, self-distributed winery in New York’s Hudson Valley,  like so many of their counterparts, saw their sales in New York City’s restaurants come to a halt with pandemic-related closures. However, a dedicated local fan base has rallied behind the husband and wife team, Matthew Spaccarelli and Casey Erdmann (who are parents to two adorable wine interns!), allowing them to confidently release their 2019 vintages. This support has kept Fjord’s wines stocked in local shops and homes. Despite the hardships, Spaccarelli says he believe’s “everyone is responsible for taking care of our society and its most vulnerable communities through social distancing even if an economic blow is the result. “

Iconic Napa Valley winery Heitz Cellar is also facing its own set of challenges in California, but is steadfastly committed to supporting the restaurant community that had shown so much of its own support for the winery in the past. As a Master Sommelier and former wine director, CEO Carlton McCoy is keeping the energy of hospitality alive and well with donations to the United Sommeliers Foundation as well as giving 10% of Heitz’s direct-to-consumer sales to the Restaurant Workers’ Community Foundation. Heitz has also joined forces with relief groups such as Abode Services Napa, The Table Napa, and The Salvation Army to donate 500 pounds of biodynamic Angus beef to people in need. 

Orange Glou wine subscription service

E-Commerce, delivery, and virtual happy hours are part of the new normal

In New York City and other cities around the country, liquor laws have been changed in response to social distancing measures to allow restaurants and bars to deliver wine and cocktails, and many retail shops have now offered local delivery. In Pennsylvania, however, wine and liquor stores are state-run, and have been closed since mid-March. The statewide closure, not shockingly, added to the skyrocketing sales of direct-to-consumer wine subscriptions. Countrywide, e-commerce sales at the beginning of April 2020 had increased by 441% compared to the first weeks of April 2019, according to Nielsen. 

MYSA Natural Wine, a sustainability-minded, direct-to-consumer importer (a first of its kind) has seen sales of their curated subscription packs increase 1,220% (that’s right) within the last 30 days. In Pennsylvania, MYSA has seen its most dramatic jump in subscriptions—up 400%. Co-founders Holly Berrigan and Nic Jansson’s goal was to introduce small European natural wine producers to the US Market. Recently they have had to adjust their selections to include more US producers because sourcing new imports was becoming quite difficult.

Orange Glou, a new business started in October 2019, saw founder Doreen Winkler having to adjust business plans due to COVID-19. Orange Glou is a monthly online subscription (one-time purchases are also available) service dedicated to highly sought after orange wines, which coincided with monthly bi-coastal pop-up bars.  However, since the age of social distancing, the energetic bars are on hold with focus shifted to virtual tastings on Instagram Live (@orange_glou). The lively tasting includes interviews with winemakers and importers while discussing and tasting wines from the subscription pack. Winkler says that the most important thing about the tastings is the community. If you’re a fan of orange wine styles, and all those options are not convincing enough to try, there’s also an adorable fluffy dog named Rouge that might make an appearance. The virtual experience takes place on Mondays for the rest of April and will be bi-weekly in May (check Instagram for details).

MYSA founders Nic Jansson and Holly Berrigan

Importers and distributors 

Broadbent Selections’ portfolio showcases some of the world’s most sought-after wines, including Chateau Musar and Tyrrell’s. The import company was founded by leading Port and Madeira expert Bartholomew Broadbent in 1996 and has distribution throughout the US.  Much like the rest of the industry, Broadbent also felt the effects of COVID. The company, which hosts anywhere from 10-15 winemakers per year had to cancel the visits when international travel restrictions were put in place. As COVID cases grew in the Southern Hemisphere, the importer was also faced with port closures resulting in an inability to get shipments through for weeks. 

Although restaurant sales have been non-existent for most importers and distributors, retail sales have been strong. However, hesitant retailers have not been purchasing new imports—instead they stick to re-stocking familiar wines. Broadbent continues to support their distribution teams around the US by sending out new information and samples when its possible to connect with intrepid buyers. Director of Education for Broadbent, Master Sommelier Maximillian Kast, helps the team stay connected and engaged virtually through product training, educational seminars, and online discussions with their producers from around the world.  

Eklektikon, importer of Greek wines, remains focused in combatting the challenges facing its base of artisanal winemakers represented in US markets. Efficiency and a passion for the community have allowed for supply to keep flowing, and contributions to those in need.  Eklektikon collaborated with local NYC retailers, including Foragers Market in Chelsea, to create a three-bottle “Greek Islands Wine Pack”, with each store having a different theme for its packs. The wines in the packs provide a wide range of Greek wine selections to showcase the talented winemakers behind them. In addition, 10%  of profits from the packs are being donated to the Off Their Plate charity initiative that benefits the health and restaurant industries. 

It’s important during these times to continue to be optimistic and contribute to awareness of health and communication. The availability of great wine is one of the few pleasures that help us stay sated, and connected. Cheers to all who keep the industry going! For more information on how to help the industry as a whole, or by region, please click here.