The Business of Wine

Caifu Magazine |
Posted: January 13, 2017 | Updated: March 16, 2017 at 2:43 pm


16No one gets into the business of wine to make money. Owning a vineyard is a labour of love, and it is a labour.

Just the same that hasn’t stopped any number of well-heeled entrepreneurs (and some not so well-heeled) from buying expensive land (especially if you’re looking at California’s Napa Valley) and pouring their hard earned money into a winery.
Land and equipment costs alone for even a modest winery (2000 cases a year) can run as high as $3.5 million USD (actually economies of scale can be significant in the wine business).

Not every would be vintner is a tech millionaire looking for an expensive hobby, some come to the industry via family history, a business handed done through generations.

Certainly that’s the case for many French and Italian wineries, and in the Canadian wine growing region of Kelowna. President Jennifer Molgat of The View Winery found herself running small winery from her family’s orchard farm, and from there successfully built it into an almost 10,000 a year winery.

CAIFU was able talk with Jennifer (who was out surveying her vineyard as we chatted).

18CAIFU: So why would any (sane) person start a winery?

Jennifer: (Laughs) Yes, it’s not easy. I got started when I took over the cider business my father had started in 2006. That really clinched the idea of starting a winery for me. My husband and I both have/had careers, he’s a television journalist and I was a teacher, but we’d always talked about starting a boutique winery when we retired. But when I took over the cider business, we had to get a manufacturer’s licence anyway, my dad suggested I should start the winery alongside the cider business.

CAIFU: But why, why wine?
Jennifer: We started it for the same reason I think anyone does, because of a love of wine, a passion for food.

CAIFU: How did your family come by the property (100 acres) that sprawls across the hills above Lake Okanagan?

Jennifer: Our estate/winery has been in the family for ve generations. My great grandfather started an orchard here in 1918. In the 1990s we started to convert some of the orchard to vineyards, that was sort of the beginning of it all. And since then seeing fruit grown on our property and converted to something people drink and enjoy immensely has been very rewarding.

CAIFU: What was it like in the beginning, any second thoughts?

Jennifer: I was a teacher at the time with two small children, yes, I was scared, but also excited, I didn’t quit my job right away though.

CAIFU: What varietals did you decide on and why:

Jennifer: My father and I both have close friends in South Africa, and when we would visit we fell in love with some of the varietals there, in the Stellenbosch region. Pinotage was one, it’s related to Pinot noir, so I thought well Pinot noir grows here so why not Pinotage. So we imported a few vines, the first challenge was to see if they were winter hardy and early harvest. In the Okanagan we have a short growing season, it gets very hot in the summer, spring comes late, and the winters can be cold, so those are the challenges. Pinotage t the bill, it’s early ripening, with reds harvested mid-October.

CAIFU: What was your first vintage?

Jennifer: Our first vintage was 2007 and a lot of people weren’t familiar with Pinotage, and were a little hesitant with it at rst. We came out with 500 cases, which at the time seemed insurmountable to sell, it was just me then in my red shoes going around to restaurants in Vancouver. We do 8,000 cases now, and of course we have a sales team.

CAIFU: Yes a red shoe is prominent on your label, why red shoes?

Jennifer: The red shoes have become my trademark, all my shoes are red. I like to wear black, and red shoes look great with black. But since stilettos aren’t practical everywhere, I also have red rubber boots for the field (which I’m wearing now) and red running shoes.

The idea for the label started when my husband and I came home from a long night of dancing and my heels were pinching me, so I took them off. Then he took one and put the heel in the top of a bottle of wine we’d been drinking. We looked at it and thought, ‘that’s a good label.’

When we went to festivals, competitions or tastings, people didn’t always remember the label, but they did remember the wine with a red shoe on it.

CAIFU: How did you build the market for your wines, and where do you export to?

Jennifer: Starting out B.C. VQA stores (British Columbia Vintners Quality Alliance) promoted proprietors, small wineries and that was a big leg up.

We don’t export internationally, so far just Canada, although our cider goes to Washington state. We’ve been approached by Chinese buyers, but they want such a large caseload right from the start, 6,000 cases, which would make it hard for us to meet the rest of our market.

CAIFU: What are Chinese buyers looking for and would you consider that market in the future?

Jennifer: Well they know their wines, I can tell you that. They’re very savvy, when I first met with some of them I offered them an ice wine (a sweet desert wine harvested from frozen, grapes), but no, they were interested in the big reds.

Although our ice wine did just win double gold at the China Wine & Spirits competition, so who knows maybe they’ll take another look at our ice wine.

Or maybe we’ll start to sell some reds there, You never know, it is the fastest growing wine market in the world. This is why we put our wines in competition, to promote them and grow awareness.

CAIFU: What about cider, does it help support the wine business, like Mission Hills (a large winery in the region) is supported by ‘Mike’s Hard Lemonade’ (a fruit drink with alcohol).

Jennifer: Cider is actually a very competitive product, and it takes a lot of effort and expense to produce, the margins are smaller than wine. It’s definitely not a cash cow. Mike’s Hard Lemonade probably doesn’t use the premium ingredients we do.

Starting out winemakers/experts didn’t want to be involved in the cider business, it hadn’t taken o yet. So when trying to nd a winemaker I would entice him or her with the carrot of producing a premium wine as well as being involved in the cider business.

Now when we had a launch party for a new cider in Vancouver, our winemaker was happy to be known as the cider maker. That definitely wasn’t the case 7 years ago. It’s taken on a new cache, it’s not just hooch made from leftover rotten apples anymore.

CAIFU: What is the community like in a winegrowing region, is it cutthroat competition or one big happy family or somewhere in the middle?

Jennifer: Starting out I was blown away with how collaborative everyone was. People from established wineries would take me under their wing, let me use their equipment, even loan me equipment, there was/is definitely a feeling of were all in this together. It’s changed a little, only because there are so many new wineries I just don’t know their names anymore. But still there is the feeling we all want the area to be the best it can, and support each other in that, sharing information and even employees. I don’t know if that is the same in larger winegrowing regions, but suspect there probably is some of that.

CAIFU: But it is still a business, and presumably you are all competing for largely the same market?

Jennifer: Obviously there is competition, and you certainly can’t rest on your laurels. In fact I recently had lunch with the owner of a large winery and he said basically that, you always have to keep working and improving.

CAIFU: What about staff and labour, is it hard to come by at harvest time?

Jennifer: Typically we employ four-five employees year round, and that of course goes up at harvest time. Usually it’s a transient crowd. Students and backpacking travellers looking for a different experience. I have a bonus system for those who stick it out, since come October when the weather’s a lot colder and the apple orchards need to be harvested, many decide it’s not so much fun anymore, so that’s always a challenge.

CAIFU: Is it all work, or is any of the romantic notion of some sort of pastoral ideal still a part of it?

Jennifer: Yes it’s true a lot of people start out with a romantic notion of what it’s like to run a winery. It is hard work, but it is romantic. I think to myself sometimes that it’s amazing what I do. Walking through the vineyards early in the morning and coming across a doe staring at me, or picnics with friends, sampling the wine with charcuterie, the lake sparkling in the background, it’s pretty wonderful. But it is labour, a labour of love, no one is going to become a billionaire running a winery, certainly I’m not making a ton of cash.

CAIFU: In other wine growing regions, but Napa Valley in particular, tourism and wine tours was a big part of developing the region’s success. Is it similar for you and the Kelowna/ Okanagan region?

Jennifer: Tourism is huge for us, and yes the entire region. There are so many people coming every year now, it’s really exciting. In the summer you have non-stop guests because everyone wants to be here. But we also don’t want to forget the locals, who are very supportive of the industry. Come mid-October you can hear a pin drop in the wine shop, so we have tastings for locals in the fall and winter. We want to make this a year round business ideally.