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2008 Cline and Jacuzzi National Sales & Marketing Meeting. Growth. Waves of growth Red truck Red truck sale 2005 Avzin, cal zin, cal syrah, Viognier, cashmere 2007 = red truck revenue 2008 Case volume = red truck/Cline units 2005 2008 Jacuzzi opening brand launch total 350,000 cases

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2008 Cline and Jacuzzi National Sales & Marketing Meeting

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  • Waves of growth
  • Red truck
  • Red truck sale 2005
  • Avzin, cal zin, cal syrah,
  • Viognier, cashmere
  • 2007 = red truck revenue
  • 2008 Case volume = red truck/Cline units 2005
  • 2008 Jacuzzi opening brand launch total 350,000 cases
  • 2009 next monumental wave 375,000 cases
  • Canada 78% increase this year
field feedback
Field Feedback

Melanie – what’s the focus and message on JFV?

Chip – where are we going?

Karl – create an Reg Mgr activity calendar

Keith – with importance of PN on the JFV brand need to re-launch with focus on Cab and PN with POS to tell the story

CA Zinf – any changes/label?

Sonoma Syrah – supply meet demand with LCBO

Larger Backcards for Bigger Displays on CA Zinf

Petaluma winery and our 5 year projection

Back labels – adding new info to Cashmere and the others?

zinfandel category leaders over 8
Zinfandel Category Leaders Over $8

Category$9.78, +4.7%

Nielsen 52 weeks 12/13/08

Total US

#1, $9.04


#2, $9.86


#3, $15.14


Total US

#4, $10.75


#5, $8.25


#6, $11.98


cline zinfandel
CLINE Zinfandel
  • Category Data - Total US (Nielsen 52 weeks 12/13/08)
  • Total Zinfandel Category: +7% in $, +5% Cases
  • CLINE ranked #7 Total Zinfandel Category
  • CLINE Zinfandel sales $2.6MM and +21.6%, units sales +21.1%, ACV 12%
  • $9.60, (+$0.54 higher than #1 ranked Zin)
  • Unique Points
  • In over 3,000 restaurants around the US representing approximately 30% of all accounts sold
  • Taste profile consumer friendly
  • Accolades
  • 2006 - Top 40 Wine Award runners-up, Sunset, September 2008
  • 2005 - “250 Great Values”, 85 pts, Wine Spectator, October 31, 2007
cline ancient vines zinfandel
CLINE Ancient Vines Zinfandel
  • Category Data - Total US (Nielsen 52 weeks 12/13//08)
  • CLINE Ranked #7 > $12 per bottle
  • CLINE Ranked #26 Total Zinfandel Category
  • CLINE ANCIENT VINES Zinfandel, bottle $14.68, sales $1.3MM and +20.1%, units sales +21.7%, ACV 8%
  • Unique Points
  • Strong margins to wholesale and trade
  • Grapes from 50+ year-old vines in Oakley and Lodi
  • Featured in over 2,000 restaurants BTG representing approximately 33% of all accounts sold
  • PF Changs national BTG program utilizing multi-part back label recipe
  • Accolades
  • 2006 - 86 pts, Wine Enthusiast,October 2008
  • 2005 - "Very Good”, Consumer Reports,December 2006
  • 2004 - “Editors' Choice”, 90pts, Wine Enthusiast,November 1, 2005
  • 2003 - “Best Value Reds”, 100 Values for $15 or less,Wine Spectator,May 15, 2005
cline syrah
  • Category Data - Total US (Nielsen 52 weeks 09/20/08)
  • CLINE Ranked #11 Domestic Syrah Category, $9-11.99
  • CLINE Syrah sales $503K and +8%, units sales 54K and +10%, ACV 4%
  • Selling Points
  • All Sonoma fruit consumer friendly taste profile
  • Accolades
  • 2006 - “Very Good- Best Value”, The Wall Street Journal, June 8, 2007
  • 2005 - 86 pts, Wine Spectator, March 2007
  • Category Data - Total US (Nielsen 52 weeks 09/20/08)
  • CLINE Ranked #11 Domestic Syrah Category, $9-11.99
  • CLINE Syrah sales $503K and +8%, units sales 54K and +10%, ACV 4%
  • Selling Points
  • All Sonoma fruit consumer friendly taste profile
  • Currently sold in CPWM, Safeway Group, and some Kroger KMAs
  • Accolades
  • 2005 - “Best Values”, 86 pts, Wine Spectator,December 31, 2007-January 15, 2008
  • 2004 - “Recommended”, Decanter, November 2007
  • 2003 - “Best Buy”, 86 pts, Wine Enthusiast, Best of the Year 2005
cline viognier
CLINE Viognier
  • Category Data - Total US (Nielsen 52 weeks 09/20/08)
  • CLINE Ranked #2 Total Viognier Category
  • CLINE Viognier sales $627K and +6%, units sales over 67K and +5%, ACV 4%
  • Smoking Loon #1, sales $880K and -13%, unit sales 115K and -13%
  • Selling Points
  • Featured in approximately 1,000 restaurants BTG representing approximately 38% of all accounts sold
  • Stainless steel fermentation offers consumer friendly taste profile
  • Currently sold in CPWM, Safeway Group, and some Kroger KMAs
  • Accolades
  • 2006 - “Very Good- Best Value”, The Wall Street Journal, June 8, 2007
  • 2005 - 86 pts, Wine Spectator, March 2007
cline cashmere
CLINE Cashmere
  • Category Data - Total US
  • Category +21.0% (Category – Domestic Red Blends, Nielsen 52 weeks 09/20/08)
  • Depletions +269%
  • +205% Accounts sold growth
  • Unique Points
  • Strong margins to wholesale and trade
  • Currently authorized in CPWM and has sold approximately 2,000 cases in 9 months
  • Taste profile consumer friendly
  • Strong strategic brand and Rhone focus alignment
  • Great expression of Cline’s vineyards – Oakley and Sonoma
  • Green String farmed – naturally and sustainably
  • $25,000 donated to Breast Cancer Network of Strength
  • Accolades
  • 2006 - 85 pts, Wine Enthusiast, July, 2008
  • 2005 - 87 pts, Wine Spectator,February 29, 2008
new countries in 2008
New Countries in 2008

Taiwan – 2 wines authorized in Carrefours

Ireland – high end importer/retailer - initial purchase was 440 cases


Puerto Rico – importer, distributor and retailer


Bermuda – from Rolf Lutz

Colombia – via Service Innovations

Mexico – Cabo San Lucas – via Service Innovations

transportation hits for 2008
Transportation Hits for 2008

Continental Airlines – AV Zinf (First Class) and CA Zinf (Business)

Delta – two rotations of Cashmere – bought 3,400 cases!!

British Air – Sonoma Cool Climate Syrah and LC Syrah for 1st Class (Jancis Robinson and Hugh Johnson on juding panel)

Royal Caribbean Cruise Lines – CA Zinfandel BTG

Holland American – CA Zinfandel BTG

Norwegian – CA Zinfandel BTG

Disney Cruise Lines – CA Zinfandel BTG

Great job by Devine and Sons

october program
October program

Ancient Vines Zinfandel (10/8-11/4/08)

Oakley 5 Reds  (10/8-11/4/08)

Syrah  (10/8-11/4/08) On ad, but not in a national stack location

  • No vendor POS
  • POS materials will be produced in-house
  • Ensure no out of stock issues
  • Support CPWM with any distributor discrepancies
  • $25,000 to sponsor Ride to Empower in Solvang, October 25
  • 9 business partners donated $7,000 ($3,000 from CPWM thru Cline ’06 program)
  • More than $15,000 raised by team
  • Lisa Tuttle, Peggy Phelan, 3 wine club members; 8 riders on Team Cline
cashmere october breast cancer awareness month
Cashmere October Breast Cancer Awareness Month
  • MO - St Louis Cellars, Cellar Rat (Kansas City), October WOM program
  • SoCAL - Wineworks for Everyone, Tasting hosted by Karl
  • TX - CPWMs extra cases for October w/ 9 demos all over state
  • OH - Hospitality Restaurants, Cleveland
pf chang s partnership
PF Chang’s Partnership
  • AV Zin Multi-part back label recipe
  • National mandatory BTG program
cal zin 2 off irc fl
Cal Zin $2 off IRC-FL
  • Objective to gain Cal Zin warehouse placement at Publix
  • Ran program March 1 to May 31, low competitive promotional activity in category
  • Produced 6M IRCs
  • Redemption 1830 coupons, $3660
  • Total program cost, ~$6500
cline wooden racks
Cline Wooden Racks
  • Holds 3 cases
  • COGs $95 per unit
  • Placement: 20 to LA, 8 to CO, 2 to NM
reaching the millenials viral marketing
Reaching The MillenialsViral Marketing
  • Cline Cellars on Facebook
  • Facebook demographics: young adults (26-34) and middle-aged (35-44)
  • Little interaction gives measurable connections
  • Joining new groups, adding an application, or uploading a photo, every single friend is notified
  • After 24 hours eight friends added to Cline’s facebook
  • 1,747 people were informed about Cline Cellars
  • Facebook page links web site and blog site
  • Blogspot (short for web log) acts as a mini newsletter

displays around the country
Displays Around the Country

Whole Foods, Atlanta

Whole Foods, Cleveland

Town & Country Market, Bainbridge Island

Economic Affect on Grocery ConsumersTough Times Create a Revival of the Dining Room, IRI Point of View
  • Wine purchased at grocery because of better prices/promotions
  • Baby boomers and seniors (45+) largest purchasers
  • Consumers eating out less frequently
  • Revival of family dinner (60% eating out less often)
  • Make food and wine convenient one-stop shopping
  • Increased spending on affordable luxuries such as wine
  • Category growth comes from $9-11.99 and $12.00-14.99 segments (blended at 14.2%)
  • Alternative wine varietals increasing in popularity
  • “Party” wines usually purchased at club stores, liquor chains or specialty
cline who are we and more
Cline – Who are we and more?

What is our winery position?

Perceptions? – by you, the distributor, the trade and the consumer

Where are we going?

What is our focus?

What are we doing new?

3 year strategy and Brand direction? Impact of this direction?

JFV impact?

Expectations from Marketing

Are we on the same page?

June 2009 New Item Submission FormCline Cellars, Cashmere, Red wine (Grenache, Syrah, Mourvèdre) California

Item/Brand Specs

Avg SRP: $14.99

Blended margin: 30%

Forecast: TBD (buyer input)

Buyer input A = 5K, B = 3.75K, C = 2.5K

Preferred launch timing: April, 2009

Acceptable launch timing: May, 2009

Selling Points

Currently authorized in CPWM and has sold approximately 2,000 cases in 9 months

Taste profile consumer friendly

Category growth +21%

Price appreciation

Naturally and sustainably farmed grapes

$25,000 donated to Breast Cancer Network of Strength

off premise national accts objectives 2009
Off Premise National Accts Objectives - 2009

Costco (#1) – maintain & grow AV Zinf distribution and sales

present wooden box program

RMs to carefully mine select opportunities with SVDs and Cashmere

Trader Joe’s (#2) – fill regional distribution voids around the US with CA ZN

expand to AV Zinf with current regional successes in WA and OR

present Viognier for CA stores

CPWM (#3) – maintain current 4 core national authorizations

RMs to approach regionally on Viognier and special promotions

Achieve Wine of the Month status in May or Sept/Oct

Business review in January - TBD

off premise national account objectives 2009
Off Premise National Account Objectives - 2009

Safeway (#4) – expand distro in underdeveloped regions (VA, OR, WA, NV) to parity with our 5 authorizations in CA, TX, AZ and IL

Gain Cashmere authorization

Present to go “down clusters” where appropriate

Achieve one or two floor programs

Appt with Kent on December 10th

Present AV Zin wooden box program

Sam’s Club (#5) – maintain and fill distribution on AV Zinfandel in all stores

Present wooden box program

Expand opportunities with Cashmere, SVD Zinf and Viognier

Whole Foods – get one “Top 12 under $12”

RMs to continue calling on Regional Specialists

Special multi-part label, Sonoma Syrah or AV MV

off premise national account objectives 20091
Off Premise National Account Objectives - 2009
  • Kroger – enhance exposure with the regional buyers to gain the proper distribution by KMA and learn more about their centralization plan
  • SuperValu – created sales pitch for National Presentation on November 12th. Presenting CA Zinf, AV Zinf, Cashmere and Viognier.
  • Target – presenting Cashmere for National authorization in A stores
  • AAFES – working with Melanie and Glazers to get an appointment
  • Wal-Mart – will evaluate in Spring with Glazers AE
  • Rite Aid – will evaluate in Spring and after Long’s acquistion
  • Walgreens – will evaluate in early winter
accounts sold targets for 2009 benchmarks for success
Accounts Sold Targets for 2009Benchmarks for Success
  • CA Zinfandel = equal to Ravenswood VB or 80% of A/B accounts
  • AV Zinfandel = to 90% of CA Zinfandel
  • Cashmere = to 60% of CA Zinfandel
  • Viognier = to 50% of CA Zinfandel


  • Concepts
  • 8,000 cases red in inventory
  • May/June label change opportunity
  • Who do we want to market to?
  • What do we want to look like?
jacuzzi marketing tools
Jacuzzi Marketing Tools

Jacuzzi Tasting Cards

Jacuzzi Tasting Mats

jacuzzi media visits
Jacuzzi Media Visits

Dick Rosano

  • writes for a number of national publications about wine and food, including The Washington Post, Wine News and the American Wine Society Journal
  • writing his second book about Italian-American winemakers.

Wes Marshall

  • writes for the Austin Chronicle and is also writing a book about the “best” varietals to be found

Lorri Hambuchen

  • Lorri writes a weekly wine column in the “Food Section” of the Arkansas Democrat–Gazette. She also judges numerous competitions.

Jose Garrigo

  • Is the wine writer for Miami based, Diario Las Américas which is the largest Spanish publication in the US

Jeff Cox

  • Writes about food and wine for the Press Democrat. His focus is on all things “green”

Dan Thiessen

  • Is a Seattle-based radio show host and accomplished chef
distribution drive
Distribution Drive
  • Cashmere
  • Cal Zin
  • AV Zin
  • Viognier
  • Jacuzzi Pinot Noir
  • Jacuzzi Cabernet Sauvignon
  • Jacuzzi Sei Sorelle Chardonnay
  • Increase accounts sold
  • Increase distribution
jacuzzi marketing tools1
Jacuzzi Marketing Tools

Olive Oil & Vinegar 50mLs

100 per region

Barrel Racks

60 remaining in inventory

Olive Oil and Vinegar

105 OO remaining

70 vinegar remaining

Valeriano 3Ls

120 remaining

cashmere 3l program
Cashmere – 3L Program
  • 5 cases single purchase, on-premise single get a 3L
  • COGs $40
walk to empower
Walk to Empower
  • Local Co-Sponsor in 3 major cities on Mother’s Day (Atlanta, Chicago, Cleveland, Denver, Houston, LA, Miami, Phoenix, Seattle, Washington)
  • Team Cline Walk to Empower. Build team with local suppliers and wine club members. Opportunity to get greater support and brand awareness
  • Marketing opportunities:
    • Walk to Empower promotions in May
    • National Breast Cancer Awareness promotion in October
    • Ride to Empower in October
    • Co-sponsorship of team gets logo on shirt
av zin wooden boxes
AV Zin Wooden Boxes
  • Incremental business
  • $15.65/unit
av zin 3l
AV Zin – 3L
  • 5 cases single purchase, on-premise single get a 3L
  • COGs $40
guest house policies and procedures
Guest House Policies and Procedures

Must be approved by Larry

Larry requires a TradePulse report of the customers performance

Brief description of their business with Cline and/ or the relationship to the account

T&T form COMPLETELY filled out

Form responsibility

Explain that:

No amenities

Maria lives below

11 miles from the winery

They must check in @ the winery (check-in and out in a timely manner)

3 bedrooms [8 people is the max]

Forms are due back to me at least 6 days prior to their stay

2009 new policies
2009 New Policies
  • Donations – must be approved by Fred Cline
  • Advertising – must be reviewed and approved by Charene or Larry
  • Winemaker Visits – must be fully evaluated and presented for approval by Larry
  • Tastings (All) – Distributor, Trade (In store) and Consumer events must be carefully evaluated and presented to Larry for approval BEFORE committing to.
  • Sales Blitzes –
    • We MUST do these – when planned and executed correctly in the right markets they work and achieve more than just selling cases. They gain long term attention!
    • No Mini – blitz programs. Go BIG or don’t go.
    • A full budget must be developed and presented to Larry for approval before implementing. To include: TL travel costs (air, lodging, meals, auto, etc); sample needs; price support; incentives; etc - accompanied by the case and account sold goals.
    • Blitz Standards and Elements – we will develop these & implement.
sales disciplines and expectations for 2009
Sales Disciplines and Expectations for 2009
  • Depletions – Cline and JFV topline month end depletions due on the 5th of the following month for all your major markets.
  • RM Calendar – must be completed/updated by all every 2 weeks.
  • TradePulse – region maintenance and accuracy is your responsibility.
  • Expense Reports – complete one every two weeks and mail! Be organized with receipts for ease of handling and evaluation.
  • Distributor and Market Knowledge
    • Wholesaler – purchasing agents, warehouse mgr, AR, AP, pricing coordinators, Natl Acct Mgrs and their respective accounts, different selling divisions and their leadership, major brands in house, etc.
    • Market – channel mix and dynamics (on and off premise), account profiles, key buyers, etc.
sales disciplines and expectations for 20091
Sales Disciplines and Expectations for 2009
  • Business Reviews – you decide on the frequency & when to conduct. Elements:
    • No topline deliveries of goals – grow by 7% in 2009. Drill down to the SKU level.
    • Account Sold Goals must be in place for every market for all Focus wines and by channel.
    • TradePulse must be used.
  • Pricing – be militant! Both winery and wholesale pricing is your responsibility once we reach agreement.
    • Wholesale – make sure Tiers line up correctly on ED and feature pricing.
    • Wholesale – know their margin parameters and use that as a management tool.
    • Wholesale – eliminate SPA’s (where possible) and convert to Depletion allowances.
    • Winery – keep Tova in the loop on all FOB and SPA pricing moves so she can update AMS. Give her 30 days advance notice of all changes.
sales practices behaviors
Sales Practices & Behaviors
  • GO BIG with a “jaw dropping” program – create your own hype within the distributor and market with a once a year sales initiative that will “Spark” their attention and behavior. Most likely – they will still hear small. Be creative!
  • Activity Calendar for every market – based on the market need, develop one exciting “must do” program at least three times per year. Focus these against our initiatives by channel so that you could have 8 to 10 of these occurring throughout the year. Cashmere focus, a blitz, double commission/incentive, etc. Present your full year activity calendar to your wholesalers in December with your goals.
  • Monthly Email Reminders to all Key Distributor Mgrs – informing them of YTD performance, goals, status of key initiatives, etc. These work and I’ve heard distributor managers ask our people to do this!!
  • Travel Expenses to Low Performing Small Markets – carefully measure and plan visits to these markets as the T & E expenses many times outweighs the case performance and need for the visit. HI, NV, UT, WY, KS, MS, ND, SD, USVI, AL.
sales practices behaviors1
Sales Practices & Behaviors
  • RTW – Return to winery rates for 2009
    • Oakley - $5 per case on $54 FOB.
    • CA Tier - $6 ($60) to $8 ($66) per case depending on FOB
    • AV/Cashmere/CC Syrah Tier - $10 ($90) to $12 ($96) per case depending on FOB
    • JFV – TBD
    • CA/NV/ HI/ AZ – add $2 per case to each top tier
    • These rates are to include SPA, DA, chargebacks and incentives under normal operating programs
    • This is over $2MM and is approx 7 to 8% of TL $$ sales.
  • Distributor Incentives – where do we begin?
    • Be creative and have fun with these
    • Make sure they are well thought out. An in-dept evaluation will guide your good judgment.
    • Run FOCUSED incentives against our initiatives, needs and market channel objectives – not just an across the board $5 per case.
    • Don’t pay on CPWM, Sam’s Club, Costco, TJ’s, etc – gimme National Accts sales – PAY FOR WHAT THEY ACTUALLY DO!
the final push for 2008
The final push for 2008
  • On target to achieve 350,000 cases and that is the target we must hit!!
  • International – buys in from Denmark, Sweden, UK and Ireland
  • Evaluate terms, fat pallets, etc
  • January programs to drive depletions
  • Ask Top 15 to buy for January needs to we obtain these ship targets
    • MD – 11,000 cases
    • TX – 13,500 cases
    • Illinois – 7,500 cases
    • Minnesota – 11,000 cases
    • NorCal – 29,000 cases
    • SoCal – 20,000 cases
    • CT – 4,750 cases
    • MA – 12,000 cases
    • New Jersey – 13,000 cases (NYC and NJ)
    • WA – 17,000 cases
    • OR – 6,300 cases
    • OH – 9,000 cases
    • CO – 8,500 cases
    • FL – 13,500 cases
    • NC – 7,000 cases
jacuzzi 2009
Jacuzzi 2009

Introduce in all remaining markets

Focus on Pinot Noir and Cabernet – due to inventory position

Sangiovese – BevMo only unless developed in your market(s)

Pricing (effective Jan 1, ’09)

Sei Sorelli - $72 ($13 SRP)

Sette Fratelli & Pinot Grigio - $90 (no change - $15 SRP)

Sangiovese/Primitivo/Barbera/Pinot Noir - $120 (no change $20 SRP)

Giuseppina - $96 ($17 SRP)

Cab Sau - $60 per six pack ($20 SRP)

Valeriano - $75 per six pack ($25 SRP)

jacuzzi 2010
Jacuzzi 2010

Re-define our mission

Greater focus on Italian varietals of the high quality

Lower alcohol levels in the Italian tradition

Reduce focus wines

Reduce to one Chardonnay

Set stage to raise prices

pos ordering procedures
POS Ordering & Procedures

Normal POS Material

Tova must receive the POS request by COB on Friday

Laurel will fulfill the POS requests on Monday

Sarah will send the POS on Tuesday via UPS ground to your requested location [estimate 2-5 days]

NO emergency shipments

If careful planning didn’t work out

Last minute shipping costs must be cleared through Larry

Note: We may not be able to accommodate your request

No color print outs. Period.

Keep a decent inventory at your home to keep things running smoothly

Laurel is only here on Mondays and Tuesdays

Sarah is only here Monday-Thursday

premiums ordering procedures
Premiums Ordering & Procedures

Premium Material

We still don’t have any extras

We will only ship the heavier items such as racks, wood boxes and 3Ls on a distributor’s truck

Distributor must put the Premium request on their purchase order

E-mail will not suffice as fulfillment is handled through the warehouse

Please follow these rules

texas market challenges
Texas Market Challenges

On-premise business

Work specifically with On-premise Focus people

Tailor incentives to them

Create Account List w/ specific goals

Jacuzzi identity

Re-identify brand, make focus items

Incentives for On-premise and Fine-Wine Shops

Placement programs--include Managers on incentives

March Placements $, May $/Case, September Placement $


Official 1835 State Motto: “Si quaeris peninsulam amoenam circumspice”

If you seek a pleasant peninsula, look about you

New 2008 State Motto: “Nos es propinquus pro construxi”

We are now closed for remodeling

michigan total cline depletion trends thru september
Michigan Total Cline Depletion Trends thru September

Total Cline 2692 3515 3827 +9%

Independents 1689 1690 flat

Chains/Clubs 1826 2137 +17%

World Market (closed 9 of 14 MI stores) 403 160 - 60%

Meijer 282 192 - 32%

Trader Joe’s 212 206 - 3%

Sam’s Club 376 445 +19%

Kroger 59 86 +46%

Costco 0 797 + ∞


#9 Georgia is closing fast

Michigan is the #1 most economically challenged market in the U.S.

The challenge: “Because the Overall Michigan Market is Shrinking, We Must Build Cline and Jacuzzi on the Backs of our Competitors”

michigan action points
Michigan Action Points
  • Work closely with chain division management in large distributor that dominates the zinfandel category … Ravenswood, Bogle, Rosenblum, Seghesio, Ridge and Gnarly Head are all in the same division as Cline. Know when the resets are happening, know the regional ad schedules, see the buyers and make sure we are located fairly.
  • Schedule market work that focuses on the entire state, not just metro Detroit. Build share in secondary and tertiary markets that are stableand growing- and often overlooked by the competition.
  • Aggressive, brief and motivating post-off pricing schedules that zig while our competitors zag. Planning for 2009 in Michigan, already proven successful in Ohio in 2008. Convert shelf placements into floor stacks when the pricing is hot.
  • Develop strong personal ties with the “fine wine team” causing them to use Cline as a top-of-mind brand when opportunities arise for BTG pours, features and wine of the month programs. Achieve this through regular email updates, POS sent directly to reps and key managers, and the occasional “unexpected gift at an unexpected time.”
  • Pray for people to start buying American cars again.
va cline market overview


The history of America is closely tied to that of Virginia, particularly during the Colonial period.

Jamestown, founded in 1607, was the first permanent English settlement in North America and slavery was introduced there in 1619.

The surrenders ending both the American Revolution (Yorktown) and the Civil War (Appomattox) occurred in Virginia.

The state is called the “Mother of Presidents” because eight U.S. presidents were born there

VA / Cline Market Overview
va cline market overview1
VA / Cline Market Overview

Today, the service sector provides one-third of all jobs in Virginia, generating as much income as the manufacturing and retail industries combined in 1999 and accounting for 23% of gross state product. (The largest component of the service sector is business services, which includes computer and data processing services.)

Virginia has a large number of manufacturing industries, including transportation equipment, food processing, electronic and other electrical equipment, chemicals, textiles and apparel, lumber and wood products, and furniture.

Agriculture remains an important sector, and the state ranks among the top ten in a variety of agricultural products, including tomatoes, tobacco, peanuts, apples, summer potatoes, sweet potatoes, snap beans, and turkeys and broilers. Virginia also has a large dairy industry.

Virginia is one of the top ten coal producers in the U.S. Coal accounts for roughly 70% of Virginia's mineral value; crushed stone, sand and gravel, lime, and kyanite are also mined.

va cline market overview2
VA / Cline Market Overview

Points of interest include Mt. Vernon, home of George Washington; Monticello, home of Thomas Jefferson; Stratford, home of the Lees; Richmond, capital of the Confederacy and of Virginia and home of Larry Holman; and Williamsburg, the restored Colonial capital.

The Chesapeake Bay Bridge-Tunnel spans the mouth of Chesapeake Bay, connecting Cape Charles with Norfolk. Consisting of a series of low trestles, two bridges and two mile-long tunnels, the complex is 18 miles (29 km) long. It was opened in 1964.

Other attractions are the Shenandoah National Park, Colonial National Historical Park, Fredericksburg and Spotsylvania National Military Park, the Booker T. Washington birthplace near Roanoke, Arlington House (the Robert E. Lee Memorial), Luray Caverns, the Skyline Drive, and the Blue Ridge National Parkway

Population: 7.7 million (approx 2.5 % of U.S.). VA is 12thhighest populated state.

Gomberg/Index: VA @ 2.7%, WV @ .2% = a total of 2.9% of the U.S.

va cline market overview3
VA / Cline Market Overview

The Country Vintner (TCV) was started in 1980 in Richmond, VA as a fine wine distributor, the first true fine wine house in Virginia.

TCV was later purchased from those founding partners in the early 1990’s by Doug Adams and investors. During Doug’s ownership they also purchased another excellent fine wine distributor, Spencer Graham’s Company.

In August of 2008 TCV was purchased by a new group of owners including David Townsend, President & CEO (and a previous partner); Michael Collier, VP Business Development; Mike Shepherd, VP Wine Supply/Chains, (both previous managers of TCV); plus a couple other VP’s; with PNC as the banking equity partner.

va cline market overview4
VA / Cline Market Overview


The Virginia market is a very strong franchise state with no dual distribution rights allowed.

TCV operated for many years with a very “free style/free agent” type attitude, regardless of performance, without consequences due to that franchise “protection”. Even today, on its website Customer Experience page it states, “there is never a quota for our people on the sale of any wine in the Country Vintner portfolio.”

While it has generally been a decently performing company, the franchise law has provided TCV with a type of brand insurance and annuity…..For example, when Ravenswood was purchased by Constellation a few years ago, the new owners could not move Ravenswood, so a payoff check reportedly amounting to millions was written for TCV to release Ravenswood. The same thing took place for TCV to release Blackstone, K-J, Rosemount and others.

va cline market overview5
VA / Cline Market Overview


Another issue had been a considerable preference for the brands that TCV “controlled”, i.e. TCV either brought them in to the U.S. as Importer or for the brands that TCV sold in all of its 7 markets. (Cline is in 2 of its markets: Virginia and West Virginia)

TCV has tended in the past to be rather indifferent to many other “independent” suppliers, with limited communication, especially to those in California, and yes, including Cline.

In the past, under the previous ownership, TCV had also operated very closely with Total Wine, oftentimes to the exclusion of other viable chains.

va cline market overview6
VA / Cline Market Overview


Sales Meetings are usually “closed” - for TCV employees only, and/or limited to the brands that they import or those brands they sell in all 7 markets.

The extent of “normal” Sales Meeting participation has been to present your wines for tasting only, along with a couple dozen other suppliers at the same time, with no vocal presentation to the group. The TCV salespeople, if they desired, would just walk around tasting. The suppliers are available to pour wine for a period of about 4 hours.

An alternate version of Sales Meetings is to go to each of the several Lead Wine Consultants (virtual Sales Managers) for various regions within Virginia for a meeting, involving a meal (breakfast or lunch, paid for by supplier). Then move on to another Lead Wine Consultant’s region to do the same thing and so on.

va cline market overview7
VA / Cline Market Overview

The future: Seeing a light…..?

In just the last few months of 2008 we have seen these significant changes:

The new ownership team has come into place, with the papers signed in early August.

Relocation from “the barn” offices and the remote warehouse* to the new 170,000 square foot state of the art combined location of TCV (offices and warehouse) with its challenges.

TCV taking over the Henry Wine Group operations in the Mid-Atlantic (MD, VA, DC), including brands, inventory, some office and virtually all sales staff.

TCV no longer distributes in Florida.

TCV appears to be entering a new period of improved supplier communication and relations. There now is a VP of Supplier Relations as well as a Director of Winery Relations, the latter of which I have dealt with easily/effectively the last few years as pricing manager.

 * Under the previous ownership, TCV’s offices were located in a restored barn on the farm where the owner lived. The warehouse was an old furniture warehouse in a somewhat remote part of Central VA more than 30 miles away from the offices.

va cline market overview8
VA / Cline Market Overview

And more brightness……?

With the new refreshing attitude toward Chains (other than Total Wine), being more than 50% of TCV’s business, we have begun to see placements in more of these stores. Mike Shepherd the VP of “Wine Supply” is also a reasonable, agreeable person to work with. His predecessor was quite different from Mike with his own agenda.

There is an additional Lead Wine Consultant in the Central/Western part of Virginia to provide sales management/leadership there. That now brings the total number of these “Regional Managers” to 4.

Cline depletions YTD thru Sept 2008: 3382 cases, up 15% over previous YTD. (at this rate TCV will hit 5000 case goal in ’08)

Cline depletions for full year of 2007: 4322 cases, up 8% over previous year


Roger Gobler PresentsEffectively Managing ProgramsA Meticulous – Painstaking Task - That Pays Off


Why programs are important

  • Drive volume and new distribution
  • Creates brand energy and imagery with distributor sales org
  • Gives the supplier a platform to manage his - her business

What is a program

An organized series of resources designed to create incremental volume and distribution during a specified timeframe

cline and peet s
Cline and Peet’s
  • $2.00 off Cline, $1.00 off Peet’s IRC
  • Program runs September 1- November 31, expires December 31
  • 9M neckers
  • 8M Peet’s bag stickers





effective steps to managing programs blue font critical step
Effective Steps to Managing Programs Blue Font = Critical Step

Step # 1

Timing: 120 days prior to start of program - present program to Larry & Charene

  • Specific channel, program goals with expense analysis, (i.e. cost of 3 liter, D.A. Free Goods, coupon redemption rate, etc)

Step # 2

Timing: 70 days out – present & communicate program to distributor management and establish case depletion and new account placement objectives by channel

  • Set Specific – Measurable – Attainable - Compatible goals!

Step # 3

Timing:60 days out – establish distributor inventory levels

  • A meaningless purchase order or low inventory – signals a meaningless program
Step # 4

Timing: 30 days out

  • Establish needs for promotional materials and communicate to distributor purchasing agent / warehouse POS department, request kick-off materials from winery - sell sheets, etc
  • Never handover IRC coupons, (give coupons as needed – measure need against specific goal)

Step # 5

Timing: No earlier than one week prior to start of program

  • Conduct kick-off meeting with the sales teams using promotional materials, samples and live display, (always taste if possible)

Step # 6

Timing: First two weeks of program

  • Schedule work-withs to ensure that proper presentations are being made and early successes are achieved, (or if program needed to be modified)
  • Minimum of four days in the field should be planned to support the program
Step # 7

Timing: By the 20th of first month

  • Monitor program results and manage @ mid-month
  • Flash depletions, account sold up-date and successes, (pictures)

Step # 8

Timing: Within 30 days of program completion

  • Recap program results vs. goal and communicate to distributor management


northwest wholesale transition
Northwest Wholesale Transition


Thanks again for our meeting this Morning! Attached is the document that you and I covered today and I wanted you to have a digital copy as well to sign off on! With your agreement on attainment of the goals in the attached document we can move forward together to start our partnership in the State of OR! Look out here we come! I will be sending the Focus and Goals for the Western Washington and Eastern Washington markets as well as Alaska with the same type of agreements this weekend! Thank you for your signature and your partnership in building Cline Cellars and Jacuzzi Family Vineyards in the Great Northwest!!

Michael Ginder

family owned large wine distributors in the northwest prior to 2008
Family Owned Large Wine Distributors in the Northwest Prior to 2008

Loeb Family DBA Alaska Distributors

Full Coverage AK, WA and Brokerage in ID, MT, WY

Wine, Beer, Spirits in AK and Brokered the rest and Non Alcoholic

Coors Distribution Rights in AK, WA

Mellitus Family DBA Columbia Distributors

Full Coverage in OR and WA

Wine and Beer

One Brother Owns Miller and Coors Distribution

One Brother Owns Budweiser Distribution

Lytle Family DBA Mt Hood Beverage Co

Full Market Coverage of OR

Wine Beer and Non Alcoholic

Coors Distribution OR

Odom Family DBA Odom Corp

Full Market CoverageAK and WA

Wine, Beer, Non Alcoholic and Spirits in AK

washington and oregon
Washington and Oregon

1998 Young’s Market Partners with K&L Levine Family

1998 Columbia Distributors of Oregon Mellitus Purchases Sid Eland Distributing of Washington

1999 Columbia Distributing of OR and Now WA Purchase G. Raden and Sons of WA

2000 Columbia Distributing of OR, WA Partners with Young’s Market’s of WA and buys out the Levine Family shares

2007 Miller-Coors Merge creating 1 distributor in some markets where there used to be two

2008 Columbia Distributing OR merges with Mt Hood Beverage to create CoHo Young’s Columbia sales division handles wine

wa and or with out spirits
WA and OR with out Spirits

Large Wine Distributors need Major Beer Brands to cover large geographic area efficiently

2008 Miller –Coors Merge! Distributor rights on Beer in strict franchise states cause more distributor mergers and Sales!

Loeb Family- Alaska Distributors decide to sell their AK, WA and Brokerage business

2008 currently Odom Family and Southern Wine and Spirits Create Partnership and Purchase ADCo of AK, WA, and Brokerage of ID, MT and WY

2008 September Odom –SWS Purchase McClaskey Distributing in OR


Year Markets

1968 Florida

1969 California

1976 Nevada

1992 Arizona

1993 South Carolina

1995 Pennsylvania

1996 Hawaii

1998 Kentucky

2000 New Mexico

2001 Colorado

2002 Illinois

2004 New York

2005 New Jersey

Virginia, North Carolina, Vermont,

Maine, New Hampshire andWest Virginia

Mississippi and Alabama

2006 Washington, Oregon, Idaho, Montana, Utah and Wyoming

2007 Ohio

2008 DelawareTexas and Nebraska


Year Acquisitions

1996 K&K Distributing (ID)

Silvestri Distributing (WA)

Biern (ID)

1998 Miller Franchise (WA)

1999 Hewitt Distributing (WA)

Valley Beverage (all non-AB products) (WA)

Northern Beverage (ID)

Selkirk Beverage (ID)

Hamilton Distributing (WA)

Northwest Select Wines (WA)

2001 Frontier Wine Portfolio (Gallo) (WA)

2002 Coors Franchise (WA)

Empire Distributors, Inc. (WA)

2004 Columbia Distributing (WA & ID)

Labatt (WA & ID)

Vintners/Odom Transition (WA)

2005 Buddy Beck Distributing (ID)

Pistoresi Distributing (WA)

Northwest Wine Co. (WA)

2006 B&F Distributing (WA)

2007 Mission Distributing (WA)

2008 Superior Beverage (WA)

2008: Establishment of the Odom / Southern Partnership in the Pacific Northwest

In 2007, Oregon ranked in the middle of the pack both in terms of population and median household income







































Oregon Sales Center Location





On-Premise Accounts

Off-Premise Accounts





































Walla Walla











Walla Walla


Moses Lake



On-Premise Accounts

Off-Premise Accounts


North Slope

































Lake and



Prince of Wales-

Outer Ketchikan

Aleutians East



Aleutians West


On-Premise Accounts

Off-Premise Accounts

In 2007, Alaska ranked in the bottom five in population, but its median household income ranked in the top 10 in the country


















































Coeur d’Alene

25 %




Idaho Falls


Southwestern Idaho DMA

Twin Falls




On-Premise Accounts

Off-Premise Accounts


The Past—Former NW Distributors now owned by Odom

  • Northwest Wine Co.- Seattle, WA
  • K&K Distributing - Lewiston/Moscow, ID
  • Silvestri Distributing - Clarkston, WA
  • Biern - Lewiston, ID
  • Miller Franchise - Pullman, WA
  • Hewitt Distributing - Walla Walla, WA
  • Valley Beverage (all non-AB products- Walla Walla, WA)
  • Northern Beverage - Coeur d’Alene, ID
  • Selkirk Beverage - Sandpoint, ID
  • Hamilton Distributing - Pullman, WA
  • Northwest Select Wines - Spokane, WA (N. Idaho/Eastern WA)
  • Frontier Wine Portfolio (Gallo) - Pullman, WA
  • Coors Franchise & Empire Distributors, Inc. - Spokane, WA
  • Columbia Distributing – Spokane, WA & CDA, ID
  • Labatt – Spokane, Pullman, WA & Lewiston ID
  • Vintners/Odom Transition – Spokane, WA
  • Buddy Beck Distributing- St. Maries, ID
  • Empire Beverage, Spokane, WA
  • Pistoresi Distributing- Moses Lake & Omak, WA
  • B&F Distributing- Wenatchee, WA
  • Mission Distributing-Kettle Falls, WA
  • Alaska Distributors Co., Seattle, WA
  • Friendly Distributing
  • Meyers Distributing
  • G. Raden & Sons, Seattle, WA
  • P&S Wines
  • Diversified
  • Alehouse
  • Sid Eland
  • Burkenwald
  • Cammarano
  • Mt. Hood Beverage
  • Roberti Distributing
  • McClaskey’s Wine & Spirits
  • High Desert
  • Columbia Distributing
  • Henny Hinsdale
  • Admiralty Beverage
  • Melitis Beverage

Consolidation occurred because of the greater need of suppliers to have a stronger statewide network with one-stop distributor point of contact.

obstacle fuel surcharge adjusting winery support pricing with changing cost of oil
Obstacle: Fuel Surcharge Adjusting winery support / pricing with changing cost of oil

Florida – Cline California Series

Laid In $75.89

Freight $4.53 (distributor freight charge is in motion)

Tax $5.36


FOB increase, (reduce D.A. support)

Fluctuate distributor portion of free goods chargeback

Free goods chargeback = laid in cost

texas cline month
Texas Cline Month

Sales meetings on all pads (Main & D&E) month before

POS shipped

Cline took care of sales sheets, printed at distributor

50/50 samples--$800

Special pricing, Glazer’s took minimal margins, Cline paid same DA as usual

Larry and Lisa came in to work blitz $2000 each

Cases sold 1732

Blitz cost approx. $11.50/case

multi level incentives
Multi-level incentives
  • Goal for 2007=43% increase over May 2006
  • DOS incentive—3 per market—cost $4800

DFW/HOU=$500 cash once they hit 1100 case goal for state

AUS/SANA=$300 cash once they hit 1100 case goal for state

  • Steak & Beans—District Managers Competition—Rapport Builder!

DFW/HOU % over LY--Winners get Steak dinner

AUS/SANA same, loser gets BBQ

Both BBQ’s at a house (Mel’s and Austin mgr—dates invited) —(total $2220)

• Sales representative incentive-

$5/case all Cline/Jacuzzi for month of May

$7/case once state hits 1100 case goal=$7604

No Sam’s or Costco paid, but counted for cases

  • Chain team incentive, # 43% over LY

Head gets trip to winery and 2 night stay in San Francisco

may 2008
May 2008
  • Goal set 16% Over 2007—Huge Goal to be met 2000 cases in May
  • Met with Chain Development Team in December and February prior

Individual Chains given goals, Committed to 1300 cases

LQD’s and pricing lower than any month in year

$500 Gift Certificate to Main Chain Person

• DOS payout--$2500—only 4 managers qualified (payout--$1400)

• District Manager Competition—if goal met, parties in all markets w/dates

Cline 100% wine, Glazer’s 100% food ($900)

• Sales Rep $7/case—($10,150)

• Samples 50/50 ($900)

• Lisa and Larry—stayed in each market for 3 days working market ($3000)

Total cases 2028—Cost $8.30/case

Lisa Tuttle

#1 Market Challenge:


(this is Larry’s favorite subject)

hawaii sales history
Hawaii: Sales History

Depletions Past Five Years

2004: 1116cs (includes Red Truck)

2005: 1448cs (does not include Red Truck)

2006: 1625cs (+12% over ’05)

2007: 1856cs (+15% over ’06)

2008: 1667cs Projected (-10% over ’07)

2008 YTD: -11% or -142cs (Costco)

hawaii economy tourism
Hawaii: Economy & Tourism
  • The nation’s economic woes are hitting Hawaii’s tourism industry hard
  • The number of visitors declined by more than half a million this year from 7.63 million in ’07 to 7.12 million in ’08
  • $$’s spent dropped from $12.81 billion to $11.99 billion.
  • In August alone tourism dropped 24.2% over LY…..the largest drop ever recorded.
  • Tourism accounts for 18.2% of Hawaii’s economy.
distributor challenges aws
Distributor Challenges - AWS
  • Inadequate Upper Management

No VP/Gen Wine Manager or upper management, only Executive VP of both SWS and AWS (Warren Shon)

Little or no communication by management

  • Inadequate Sales Force

Only 6 KAS for all Islands

  • Mismanagement of Brand

Prices too high and not line priced – did not reflect FOB pricing

No DA’s in place

No Incentives

Old Inventory (five warehouses, one on each island)

No samples being pulled – EVER!

  • Poor Chain Management

Four Largest Hawaiian Chains:

Costco: (AV Zin) 960cs in ’07, Sales were 50% of total depletions – almost all eggs in one basket

Foodland: (CA Zin, Vio, AV Zin) 170cs in ’07, No merchandising

Safeway: (All CA Tier, AV Zin) 60cs in ’07, Stores were buying on bottle price, not case price

Tamura’s: (Rose, CA Zin, Vio, AV Zin) 50cs in ’07, No merchandising

  • In General…..No Direction from Upper Management
action plan sws
Action Plan - SWS
  • Move Brand from AWS to SWS Re-Launching the Brand in May

Now have both a VP/Gen Wine Mngr, Asst. Wine Manager and VP Chains (all work under Warren Shon)

Much better communication with management (not perfect, but it is HI after all)

  • Bigger Sales Force

From 6 KAS to 20 On-Sale Salespeople, 3 Off-Sale Salespeople, 4 Chain Acct Executives, 26 Chain Merchandisers

  • Better Management of Brand

Line priced each tier to reflect FOB pricing

Set up DA’s

Set up Bank and Incentives

Getting rid of old inventory

Pre-approved all samples pulled (under a case)

  • Better Chain Management

Four Largest Hawaiian Chains:

Costco: (AV Zin) -240cs or 33% over LY due to Costco adding 3 more Zins (from 4)

Foodland: (CA Zin, Vio, AV Zin) Sales up 75% due to merchandising

Safeway: (All CA Tier, AV Zin) Stores are now buying on Case price (thank you Larry) sales will triple this year getting closer to 200cs

Tamura’s: (Rose, CA Zin, Vio, AV Zin) Sales have doubled due to merchandising

  • In General…..finally, more overall attention to the brand
Lisa Tuttle

#2 Market Challenge:

Raley’s Supermarket

Northern California

raley s sales history
Raley’s: Sales History

Depletions Past Three Years

2006: 1085cs

2007: 2586cs (+138% over ’06)

2008: 1500cs Projected (-42% over ’07)

2008 YTD: -47% or -978cs (CA Zin)

raley s market challenges
Raley’s: Market Challenges
  • Poor Sales

Sales down February thru May

  • New Buyer

Changed buyer in 1st Quarter

Did not see any suppliers until beginning of April

  • No Scan

Scan only in place for January during first six months of year

  • No Ads

No ads for first six months

raley s action plan
Raley’s: Action Plan
  • Stop the Bleeding ASAP!!
  • New Buyer

Was first SWS supplier to make presentation in April

Better than old buyer….able to make faster decisions

Lives in Sonoma, very familiar with Cline

  • New Item

New buyer approved CA Syrah, cut into shelf in July

  • Scan

Scan now in place July thru end of year

  • Ads

Ran August and will run again in November

  • Incentives

Ran display incentive for merchandisers along with ad and scan in August

  • Raley’s Extra Magazine

Featured CA Zin during summer ad

Lisa Tuttle

#3 Market Challenge:


Northern California

bevmo sales history
BevMo!: Sales History

Depletions Past Three Years

2006: 1259cs

2007: 2789cs (+121% over ’06)

2008: 1817cs Projected (-35% over ’07)

2008 YTD: -36% or -769cs (AV Zin)

bevmo market challenge
BevMo!: Market Challenge
  • Poor Sales

Sales down seven out of the nine months this year

  • New Ownership

New ways of buying and selling

Margins have gone up on ad/programmed wines

Smaller inventory on hand

No more ‘Winery of the Month’ and other promotions

No Holiday Catalog starting this year

  • Drop in Sales on AV Zin

Less programming on AV Zin due to low margins

Shelf sales only

bevmo action plan
BevMo!: Action Plan
  • Have the buyer take the focus off AV Zin and onto other items
  • Cameron Wilson (same buyer)

Very loyal to Cline

Lives locally in Sonoma

T&T at Jacuzzi…..

  • Wilfred Wong (BevMo! In store Wine Reviewer)

Huge Cline/Jacuzzi fan, loves Charlie

Always gives high scores (89pts on all Jacuzzi items)

Used Sei Sorelle Chard for BevMo! Wine Club/January

  • New Items

Authorized Jacuzzi Primitivo, Sangiovese and Barbera

First Chain Distribution, Exclusive to BevMo!

  • Website

All Cline and Jacuzzi wines are available on BevMo! website

  • In Store Support

Scans, in store tastings, staff tastings, store openings



My Own Private Hell

challenges past
Challenges Past
  • Large Market
  • Largely Chain Driven
  • SWS
course of action
Course of Action
  • Panic
  • Stop Panicking
  • Find Out Key Management (whose neck to get hands around), Who Can Move the Needle
  • Work the System
  • Make Friends
  • Be Mellow, But Serious
new challenges
New Challenges
  • Glazer’s/SWS Merger
  • Understanding Changing Landscape, New Roles for Key Players
  • Gaining Share of Mind in Mega Wholesaler
new item approval at ralph s
New Item Approval at Ralph’s


To get any Cline item into large, Kroger owned Grocery Chain in Southern California.

Potential Actions

Placement incentive for Account Exec, hasn’t worked.

New SWS in house exec at Ralph’s might help

Go through Kroger Corporate?

Roger’s IRC program?

Wood box AV Zin and Cashmere?

broad market case volume
Broad Market Case Volume


To significantly increase Broad Market depletions

Possible Actions

More incentives

More work withs

More aggressive programming

Change sales divisions

Rifle approach, focus on certain items with quotas

jacuzzi accounts cases sold
Jacuzzi accounts/cases sold


2008 vs. 2007 (YTD)

88 vs. 51 Accounts Sold

278 vs. 139 Cases Sold (100 cases to BevMo)


Pricing restructured (Merlot, Chard, PG at low end, Sangio, Barb, Prim, PN at mid tier, Cab and Valeriano high end. Two 6 pack on prem deals)

Incentives put in place

Aggressive sales techniques preached (Encouraged wholesaler reps to pursue any possible deal)

Focus on what can be sold most easily (Barbera-95, Pinot Noir-44)

BevMo authorization. (Barbera, Sangio and Primitivo)

jfv bottle issue
JFV Bottle Issue

Possible Solution

Have separate package for wholesale sales on Chard and Merlot.

Use JFV Cab bottle for merlot and find an affordable Burgundy bottle for chard.

Continue to sell squat bottle pack out of tasting room

  • Population: 1,9169,915 (2007est.)
  • Ranked 36th in the US for population
  • Capital: Santa Fe
  • Largest City: Albuquerque (pop 518,271)
  • 2ndlargest City: Las Cruces (pop 89,722)
  • 3rd largest City: Santa Fe (pop 73,199)
  • At a population density of 15 per square mile, New Mexico is the sixth most sparsely inhabited U.S. State. Versus the US at 79.6 per sq mile

New Mexico has the highest percent of Hispanic Americans in the US at 43%

Total number of firms in NM 136,711

Firms owned by Hispanics (21.7%)

Total number of Hispanic firms in US (6.8%)

(2002Fed Stats)

native american indians
Native American Indians

It has the third-highest percentage of Native Americans after Alaska and Oklahoma, 4]

Total number of American Indian owned firms in NM 5% versus the US at .9%

As a result, the demographics and culture of the state are unique for their strong Spanish, Mexican, and American Indian cultural influences.

bacchus wine patrol

A division of Southern Wine & Spirits of New Mexico

General Sales Manager – John Mahan

Sales Managers - Kelly Fagan and John Grimm

Sales Force – 6 representatives

In addition, 6 reps in rural areas that sell full book. However their focus is SWS.

bwp account universe
BWP Account Universe

On premise – 440 accounts

Off premise – 310 accounts

market regulations

Retail Advertising Allowed yes

Mail In Coupons Allowed yes

Instant Coupons Allowed yes

State price posting required no

Wine brand franchise state yes

State tax per 9L cs: Still Wine $ 4.05

Fortified $ 13.50

Sparkling $ 4.05

market regulations1

Free Goods yes

Quantity Discounts yes

Depletion Allowances yes

Special Purchase Allowances yes

In Store Tastings yes

sws chain accounts
SWS Chain Accounts

SWS manage the off premise chain business with a separate chain division

Off premise Key Acct Mgrs. – Craig Richards, Mike Houseman, Jason Mann and Todd Piskorski

On premise chain sales –Kelly Fagan and John Grimm (BWP)

sws account profile off premise inc bwp
SWS Account ProfileOff premise inc. BWP
  • Account TypeHTMTLTMLTTotal
  • Grocery 25 60 33 118
  • Liquor 21 31 44 96
  • Club Stores 8 2 10
  • Drug/conve 20 22 45 225 312
  • Other 22 138 160    
  • TL Off Prem 74 115 144 363 696
sws chains
SWS Chains
  • Grocery HT MTLTMTotal
  • Albertson's 8 7 8 23
  • Smith's 9 6 9 24
  • Raley's 8 1 9
  • John Brooks 3 6 9  
  • Lowes   6 7 13
  • Walmart 12 8 6 26
  • Whole Foods 2 2      
  • Safeway       4 4
  • Total Grocery 39 31 40 110
key accounts
Key Accounts


Quarter's   2 1 3

Kelly‘s 2 4 3 9

Sunflower Mkt 1 1    

Jubilation 1 1    

Toucan Market 1 1    

Total Key Liquor 7 5 3 15

club stores
Club Stores

Club StoresHTMTLTM Total

Costco     2 2

Sam’s   4 2 6

Trader Joe's 2 2    

Total Stores 8 2 10

drug convenience
Drug / Convenience

Drug / Convenience HTMTLTM Total

Walgreens 6 8 10 24

Giant 10 10 43 63

7-11 4 4 9 17

Total Drug / Conv 20 22 62 104

  • 44TH poorest state in the US
  • Numerous Indian reservations and the tribal committee controls all purchases and it is hard to get new items in. These reservations are predominately liquor and beer sales limited wine.
  • Excise tax one of the highest in the US $1.70, over 14% - $5.68/gallon
  • $4.05 per case on wine
problem solution

28% GP at BWP versus SWS runs a lower GP

Problem: John Mahan bonuses at 28%

Cline is running under 28% GP

Solution: Bring Larry the attack dog in to meet with SWS

median household income
Median household income

New Mexico – $41,452

Louisiana – $40,926

Alabama – $40,554

Kentucky – $40,267

Arkansas – $38,134

West Virginia – $37,060

Mississippi – $36,338 Puerto Rico – $17,741


New Mexico is in the top 20 highest DUI deaths in America.

For the last 2 years they have increased road checks, sting operations and that has certainly hurt the on premise business in wine and spirits.

Many restaurants have closed and only a few new openings

  • Heavy programming to increase floor presence
  • Bakers dozen to attain more on premise business
  • Targeting the 3 major cities
  • Riding with sales reps so they learn the Cline/Jacuzzi Portfolio
  • In store tastings
  • Staff tastings for on and off premise
  • Maintain popular price points for this economically challenged state
nj rm overview

NJ RM Overview

Top 3 Market Challenges

And Action Plan

nj and r r marketing demographics
NJ and R&R Marketing Demographics
  • Population - 8,890,300
  • White - 67.4%
  • Afro Amer - 13.6%
  • Asian – 5.7%
  • Hispanic - 13.3%
nj and r r marketing demographics1
NJ and R&R Marketing Demographics
  • Median household income
  • $ 57,154.00
  • Persons per square mile
  • 1,145.4 miles
Owned privately until April 2004
  • Purchased by Charmer-Sunbelt Group
  • Servicing over 7,000 accounts in both the on and off trade segment, with sales volume close to $400 million
  • Employment is over 350 people with 150+ involved in sales and marketing
Operates out of two warehouses with over 240K in space with 55 trucks delivering the entire state. The warehouse ships out over 22K cases and 40K bottles per day.
  • A- Management Hierarchy
  • 123 sales reps
  • 9 SM
  • 5 Brand Mgrs
  • 4-5 channel managers
  • 6-8 executives
  • Retailer demographics in an independent market
  • NJ pricing and Nat’l brands Impact
action plans for 2009
Action Plans for 2009


  • With the lack of upper management’s impact on the brands such as Cline and the inability to effect the sales force and street.
  • The results must be gotten by attaching to the proper sales managers with the appropriate targeted accounts that would
a con t
A con’t

fit Clines profile. In addition there must be a formulated and an identified account breakdown to be targeted by SM then by SR. The accounts then must be attacked by all parties and tied to certain SKUs and a reasonable time frame.

  • The demographics of the NJ retailer not entirely unlike other parts of the US has changed dramatically. The retailer makeup now includes many nationalities with diverse ethnic and religious backgrounds and beliefs.
  • As part of the account breakdown process there must also be a buying group and lead retailer within the group
b con t
B con’t
  • It has become a very complicated process in the independent markets and it is going to become more increasingly important to work with and understand the new diverse landscape (even if you don’t enjoy Indian food)
  • NJ is a difficult state to work in based on its current pricing scheme that was developed about 10 years ago called RIPS or Retailer Incentive Program (legal kickbacks paided by the suppliers). Based on this current structure the Nat’l brands and big companies have a decided advantage against the small to mid-sized companies.
c con t
C con’t
  • With all that in mind the goal for 2009 is to create some creative pricing to contend and compete with the aforementioned scenarios.
  • Blind filing of prices
  • Weekly specials
  • Bi-weekly specials
  • Increase frontline to increase RIP
c con t1
C con’t
  • Work with retailer groups
  • Work with salesperson/SM