Interview: Milbrandt Vineyards

Posted by dp
August 11, 2008

Winery Link: www.milbrandtvineyards.com
Winery Phone #: 509-788-0030

If you’ve been reading my reviews of wine for awhile, you’ll know that I gave a pass to the Milbrandt wines I’ve reviewed so far but - as always - encourage you to try them yourself and ultimatley embrace your own palate.

Their marketing guru, Dan Bachilla, first contacted Winefoot by leaving a comment regarding his disagreement with my reviews but turned out to be an upstanding guy. Thru several emails back and forth I got a sense of his passion and commitment to ensuring a good customer experience and he agreed to this interview.

These are the kinds of people we should all be supporting - passionate, open to discourse regarding wine and fans of helping folks to embrace their own palates.

WF: Tell us a bit about the Milbrandt brother’s (Butch and Jerry) story.

Dan: Butch and Jerry are part of a legacy of farming families who found their way to the NW over 50 years ago. Their family history is a story of opportunity and perseverance through 2 World Wars. In 1997, Butch and Jerry were once again afforded an opportunity and planted their first vineyards in the Ancient Lakes area (Evergreen) and Wahluke Slope (Sundance). Today we are among the largest Estate vineyard owners in the state with 1600 acres and growing. In 2005 we began construction on a winery which was based on demand for custom crush capacity. What began as a “small” 100K case winery is today an 800K case and expanding facility. In 2006, under the talented direction of Gordy Hill, we began crafting our first wines in small lots from the very finest selections from our vineyards and cellars.

WF: Some of our readers may not know about how many wineries purchase their grapes from Milbrandt Vineyards – how many wineries do you guys source now?

Dan: Approx. 50 wineries source fruit from our vineyards. Some of those (Ch. St Michelle and others) are under various terms of contract. Approx. 60% of our fruit is sold outright at this time. We continue to fine tune these arrangements as the price and demand for our fruit increases. As you might imagine Riesling from Evergreen Vineyard is a very hot item and we are seeing a surge in Chardonnay sales as well.

WF: You and I have had emails about the pricing game at retail – what steps does Milbrandt take to ensure it’s putting out a wine at a good QPR (Quality-price-ratio)?

Dan: This is really two distinct questions.

Your first question is how do we arrive at a “retail” price for our wines?

Obviously we have to look at the overall costs that go into the finished product. These include the “cost” of the fruit (vineyard, personnel, etc…), winery, storage, wood treatments, handling, transportation, and time (plus other tangibles and intangibles). Just to give an example. A top-of-the-line new French oak barrel now costs more than $1300. Each barrel equals about 25 cases of wine. Once those cost have been established we arrive at an “FOB” price that has a margin that is profitable. “FOB” is simply the price any wholesaler purchases the wine at from a “dock” In our case we have our wine docked in the Seattle area and in Napa, CA.

The second question is…

What do we do to ensure outstanding QPR?

This question is difficult to answer in a brief manner as there are so many things that impact the quality and ultimate price of a wine. From sanitation to methodology to product and marketing; everything we do has to be focused achieving the goal; profitability. The x-factor is how a winery achieves that. Milbrandt has chosen to develop two distinct tiers of wine at aggressive price points that deliver tremendous quality. There are other models; limited production of high-priced wines or low-price, large production wines for instance. Every business model demands a different approach to what goes into the bottle.

As with all wineries, the end product begins in the vineyards. Milbrandt Vineyards employs several of the top Vineyard Mangers in the NW who work with one of the largest teams in the state. Winemaker Gordon Hill is very involved in the vineyard process with Head Vineyard Manager Jim McFerran. Between them they have over 50 years experience working with vineyards across WA and that experience includes working with Milbrandt Vineyards fruit from the inception of the vineyards. Both Gordy and Jim gravitated to Milbrandt after years of working with the vineyards and fruit, so they had a very good understanding of what they were getting into and ideas about where they wanted to focus into the future.

Once the fruit is harvested and into Gordy’s very capable hands in the winery, it is handled throughout its winery lifecycle in small lots until we grade and make blending decisions. I have heard Gordy comment more than once; “We work so hard to get the best fruit from the vines into the winery, I don’t want to screw it up with a heavy hand here in the winery.” This is the approach we focus on; making well balanced wines of exceptional quality. Milbrandt Vineyards wines are somewhat restrained, more elegant than the majority of the same varietals from WA.

In our case, we actually established price points that we wanted to sell wine in before we ever bottled the finished product. Those points were between $12 & $15 for our Traditions line, and between $20 & $25 for our Legacy wines. At both price points we over-deliver on quality because of the nature of our operation. Owning the vineyard and winery offers scales of economy that allow us to be very aggressive with our pricing structure.

WF: While you don’t have final say in what a retailer charges for your wine, what are some suggestions you may have for folks to help make sure they’re paying a fair price for your wines or anyone’s wine for that matter?

Dan: Today, most people have access to the internet. You can search online by name or go to a wine focused search engine like winesearcher.com to find pricing on wines. However, many online resalers are in the habit of pricing wines like Milbrandt Vineyards at ridiculously low markups; some even hold “1 cent” sales to get consumers to purchase in the hopes of generating consumer loyalty. You can actually find some Milbrandt Vineyards Legacy red wines online for $18.99.

This wont include shipping so ultimately the cost is significanly higher. I would say a good tool is to find the high and low price and average them - then add $2 or $3. Milbrandt Vineyard Legacy Wines should be fairly priced at retail for $25. At this price point the wholesaler and the reatiler are making an acceptable margin and the customer is paying a fair price.

WF: Can you tell us anything about the other wine labels your company makes wine for?

Dan: Its not an secret that we make wine for other labels. Our winery is named Wahluke Wine Co. and our capacity is over 800K cases per year. We only made 22K cases of Milbrandt Vineyards in the first vintage. There are some very significant brands that include the Milbrandt name or vineyard name on their labels (front or back) and we have strong relationships with all our fruit and wine customers.

WF: What is Gordon Hill’s approach to making wines for the Milbrandt label and how have those wines been received so far by the greater wine-drinking world?

Dan: Gordon Hill has spent many hours explaining his approach to making wine for Milbrandt Vineyards. Gordy talks animatedly and with pride about being a “blender”. He describes “constructing” a wine from various sources. With Red wines he will use a base from one vineyard (like Northridge) for structure and layer in elements that support the style and development of that particular wine. He will add fruit from another vineyard to give it forward fruit and supple tannins, then find something to blend for mid-palette weight, vibrancy, and length of finish.

I have learned more in working with Gordy for the last 2 years than in the rest of my 20 year wine career combined. He has an amazing talent for identifying how to improve and strengthen a blend. What amazes me most is his description of how a wine will evolve and then to see it happen exactly the way he planned.

WF: What are the primary differences between your Traditions and Legacy labels?

Dan: We designated blocks with our vineyards (over 1600 Estate acres) that are unique or special in some respect. Tier 2 blocks are destined for our Traditions wines. Tier 1 fruit goes into our Legacy program. We will trickle down fruit from our tier one blocks to the Traditions line but will not include Tier 2 fruit in our Legacy program. In the case of out Traditions Merlot for instance, we blended 4% Barbera into the wine. That fruit was from one of our tier 1 blocks but we thought it made the wine better so we moved ahead with the idea.

Beyond that, it is a matter of how the wines are handled and blended. The Legacy wines are prioritized into the best barrels every year and are handled in small lots and always with an eye toward more texture, layers, and complexity.

WF: We’re not really fans of the points system so widely used in the wine industry – what are some of this you do at Milbrandt to help encourage folks to always trust their own palate’s over points?

Dan: Not many of us inside the industry are fans of the points system. However, the general buying public continues to be highly influenced by scores and the recommendations of various publications. We encourage our wholesalers and retailers to aggressively taste our wines and we support them, both financially and with good point of sale, in an effort to continue to introduce the public to our wines. I have been on the road for 44 of the last 52 weeks, and much of my time goes toward public education at tasting events and retail events to help promote Washington Wines and Milbrandt Vineyards.

I find that I have to constantly encourage people to “like what they like” What I mean by this is that to many emerging wine drinkers are influenced and intimidated by publications and blogs. You will recall this is one reason I criticized you early on. I belive consumers need to be encouraged to taste a lot and drink what they find appealing, even if that is soething of mediocre quality at a very good price. Why should someone feel compelled to buy the latest 90 point tannin bomb if what they really like is Yellow Tail Shiraz?9.  

WF: How do you prioritize which fruit from your vineyards you’ll sell versus keep to make your own wines with?

Dan: This is part of the Tier 1- Tier 2 program we instituted in 2005. On top of that we are constantly evaluating the lots of wine we have in house and are able to make critical choices throughout the life cycle of the wines.

WF: The greater Mattawa WA area has really been producing some good fruits over the past few years  - where do you see this region going over the next 3-5 years in terms of ratcheting up the quality even further?

Dan: As with everything in WA, the Wahluke Slope is still very young relative to wine growing regions around the world. We have been able to accelerate our development by utilizing the science involved in the CA industry and adapting it to our unique environment. The learning curve has been radically steep and I believe you will see improvements across the board from WA wineries in the next 10 years. If I had to take a stand I would say that Washington, and in particular Wahluke Slope and Ancient Lakes areas, will see exception quality jumps with stunning red wines and world class white wines. Jay Miller from the Wine Advocate recently visited WA and wrote in his subsequent column that WA is the premier place in the world to grow Petit Verdot and he also observed that WA Malbec will rival or surpass that of Argentina. Milbrandt Vineyards is already working with both varietals and we are very excited about where we see these wines going.

WF: How does the team there at Milbrandt go about establishing what their wines should be priced at?

Dan: This is a great question for any winery and I would be greatly interested in the answers if they were candid. Sadly, I don’t believe there would be many forthright answers.

I joined Milbrandt at the very beginning of the Milbrandt Vineyards label project. We completed some market research and compared it with our production capabilities and determined price points before we ever began to blend or bottle our wines. Our goal was to over-deliver quality at very aggressive price points.

There are many factors that go into the pricing matrix. I will try to highlight a couple…

WF: Have you guys seen any slow-downs of wine sales at large due to other inflationary issues such as gas prices for example?

Dan: In our case it may be hard to judge. This is the first vintage of wines from Milbrandt Vineyards and we have experienced a very steady growth trend since our release in the 4th quarter of 2007. We are now actively distributing our wines in almost 40 states. I have observed and heard comment that there has been a general shift in purchasing away from the higher price points toward the $10-$15 categories in some markets.

WF: You’ve mentioned to me that Milbrandt is working hard at establishing WA wine outside the boundaries of our state – what are some of the measure you’ve undertaken to ensure that effort is successful?

Dan: We are very active partners with the WA Wine Commission and work very closely with them on all their initiatives, particularly when it comes to trade and public tastings and education. In addition, Butch and I have had the opportunity to meet with many members of the media in our travels in this past year and we believe in grasping every opportunity to promote WA wines whenever possible. It would be short sighted if we didn’t believe that promoting the whole industry would not improve our own recognition and for this reason we, as well as most winegrowers and winemakers in WA, believe we are partners in creating a sustainable industry that will thrive and benefit all of us.

WF: In closing, what are a few things you’d like our readers to know and understand about Milbrandt?

Dan: I think the most important thing I would like anyone to take away from our wines and our company model is that we are in a unique position to really dictate our own future. With our Estate Vineyards, our state of the art winery, one of the most respected winemakers from WA, and a dedicated team of professionals, we are poised to deliver outstanding quality across all price ranges and Milbrandt Vineyards will be synonymous with WA wine very soon. We have been the fortunate recipient of a great deal of positive press and we are continuing to improve all aspects of our wine and our marketing. Watch us; we are going places!

WF: Thanks Dan for your time!

Interviews

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