The Canadian Association of Professional Sommeliers, Atlantic Chapter - HomeThe Canadian Association of Professional Sommeliers, Atlantic Chapter - Who We AreThe Canadian Association of Professional Sommeliers, Atlantic Chapter - Education CoursesThe Canadian Association of Professional Sommeliers, Atlantic Chapter - News CalendarThe Canadian Association of Professional Sommeliers, Atlantic Chapter - MembershipThe Canadian Association of Professional Sommeliers, Atlantic Chapter - Members OnlyThe Canadian Association of Professional Sommeliers, Atlantic Chapter - Links StoriesThe Canadian Association of Professional Sommeliers, Atlantic Chapter - Fun

Articles from The Herald and The Coast on Reduced Markup for NS Wines at NSLC

Grape Expectations
N.S. winemakers in good cheer; Liquor Corp. to lower markup

By PATRICIA BROOKS ARENBURG Staff Reporter
Thu. Nov 15 - 5:13 AM

Local winemakers will have an­other reason to pop the corks in the new year.

On Jan. 2, the Nova Scotia Li­quor Corp. will drop its price markup on Nova Scotia wines by 70 per cent to encourage in­dustry growth. It may be good news for grow­ers but it will take awhile for consumers to reap the benefits. “If people are expecting to see on Jan. 2 a whole bunch more Nova Scotia wine and a whole bunch more lower prices for those wines, that’s not going to happen," NSLC spokesman Rick Perkins said.

“That’s going to happen over three to five years."

The news hadn’t yet made its way through the grapevine, but industry insiders toasted the news Wednesday.

“I think it will drastically in­crease the interest for Nova Scotians and others to get into the Nova Scotia wine industry and help put Nova Scotia wine on the national and international map over the next few years," said Hans Christian Jost.

Described as the province’s largest winemaker, Jost Vineyards has a num­ber of products already on NSLC shelves and Mr. Jost hopes to see more of the winery’s premium wines avail­able.

There are 12 commercial wineries in the province, and although the NSLC says it sells 96 per cent of all wine sold in Nova Scotia, most local wineries sell from the farm or through small, in­dependent retailers, Mr. Jost said.

“You’re getting only those people who are willing to travel to the Anna­polis Valley or the North Shore or Bridgewater region and so on to find these wines, or a few restaurants who are willing to list these wines," he said. “Now suddenly, there’s an avenue for these smaller producers to sell their product and have it visible in Sydney or Amherst or Bedford, so the expo­sure will be considerable."

Even other retailers are singing the praises of the move toward marketabil­ity.

“I think that’s wonderful because there’s nothing I think we should be doing more than supporting these provincial agricultural oper­ations," said John Stuart of Bishop’s Cellar in Halifax.

The independent retailer has about 35 different Nova Scotia wines on the shelves of his Halifax shop and tries to promote the wines to tourists and vis­itors.

“I really wouldn’t go to California to buy French wine," he said.

Benjamin Bridge Vineyards in the Gaspereau Valley is preparing to open its own winery after spending the last seven years establishing a vineyard. Like most small winery owners, Gerry McConnell and his wife, Dara Gordon, were planning to sell mostly from the farm itself, paying only a five per cent fee on sales.

“What it (the current markup) did was it made Nova Scotia products really uncompetitive," Mr. McConnell said.

“If you were trying to produce a product in the price range of the com­petitors you were trying to meet, say the $12 or $13 bottle of wine, because of the magnitude of the markup . . . the price of your bottle of wine was driven up to 20 or more dollars and it really made it uncompetitive for the market that you were targeting."

Not only is the news causing them to reconsider their business plan, but Mr. McConnell said it may “provide a stim­ulus to attract new players and new wineries into the business."

Mr. Perkins said the current markup for Nova Scotia wines is the same for all wines, regardless of the country or province of origin. But he refused to give the percentage or what it means in terms of actual dollars.

However, Mr. Jost said the liquor corporation’s traditional markup is 133 per cent. With the reduction, the price markup would be about 40 per cent.

At Bishop’s Cellar, Mr. Stuart said the markup on Nova Scotia wines is only about 30 per cent.

One of the goals is to encourage the cultivation of more land — 400 hec­tares by 2020, Mr. Perkins said — to al­low wineries to produce more wine and the liquor store to sell more local product.

Nova Scotia’s wine industry now has about 145 hectares of land, while the blooming B.C. wine industry has about 2,680 hectares and Ontario’s vineyards use over 6,000, he said.

“How they’ve managed to grow their wine businesses to the extent that they have is through a favourable treatment in the retail pricing of the locally grown products," Mr. Perkins said of the Ontario and B.C. industries.

“Our wine industry is a number of years behind theirs, but this is the es­sential step."

FIGURE IT OUT:

What it means:

• A winery may now sell a bottle to the liquor corporation for $10. The liquor corporation hikes the price by 133 per cent to $23.30.

• After Jan. 2, when the NSLC re­duces its markup by 70 per cent, it will take that same $10 bottle of wine and raise the price by 40 per cent to roughly $14.

• But although the change could mean the NSLC would get $9.30 less, that doesn’t necessarily mean con­noisseurs will be spending less.

• There is nothing in the announce­ment that precludes wineries from raising the base price of a bottle of wine.

(pbrooks@herald.ca)


And from The Coast.....


Grape expectations
The Nova Scotia wine industry gets a shot in the arm from the most unlikely of sources: The NSLC.

by Craig Pinhey


It just got easier to buy high-quality wine made from Nova Scotia grapes. This week, the NSLC announced it would cut the mark-up on Nova Scotia-grown wines by 70 percent—great news for lovers of terroir-based wines. (Terroir is the French term for the land, climate, soil and geography creating a regional character of wine.)

"Nova Scotia-grown" means wine must contain a minimum of 85 percent provincially grown grapes. This goes hand in hand with the new logo from the Winery Association of Nova Scotia. When you see a lobster claw holding a glass of wine on the foil around the cork of your wine, you know it is truly local and has met standards for grape ripeness and winemaking procedure, such as a limit on how much sugar can be used.

In most cases, the best, award-winning Nova Scotia wines have not been for sale at the NSLC. This is partly due to lack of availability—small production from a limited acreage—but it's also a winery business decision. Historically, with the 133 percent mark-up imposed by the NSLC, it's not been worth it for companies to sell these wines via the government monopoly.

Local wineries sell their wines at a much higher profit at their own stores or at the Farmers' Market and they typically sell out each vintage easily.

So, if they are already selling all these wines and don't make enough to distribute province-wide, why sell them at the NSLC, even with the reduced mark-up?

The answer, according to Hans Christian Jost, lies in the future. "This has been their [the NSLC's] boldest move in support of the industry, ever," says Jost, who knows the history of Nova Scotia wine as well as anyone. His father founded the winery in Malagash in 1983 and Jost has worked there since he was a child. "It will encourage a local wine culture, increase overall sales and help develop our wine route, which will result in increased sales in restaurants, more acreage of vines and more wineries."

This will take time, since there may not be enough current production of Nova Scotia wines to meet demand once the wines are distributed province-wide. It's hoped the more attractive business model will inspire more investors to develop vineyard land and open new wineries. It's already happening in the Gaspereau Valley, with properties like Pete Luckett's and the new Benjamin Bridge and L'Acadie Vineyards.

WANS recently unveiled an aggressive plan to increase production drastically during the next two decades. Not coincidentally, this fits nicely with the mark-up change.

Sean Buckland, who works in marketing for the winery association, says, "We are interested in growing the production from 400 acres to 1,000 by 2015 and need the assistance of the NSLC to help with marketing and selling of the added production."

Another benefit is distribution. "It's costly [for small wineries] to ship wines to places like Yarmouth, Shelburne and Cape Breton," adds Sean, "and the NSLC would provide service for the wineries to actively pursue restaurants and consumers in those remote areas."

It makes sense. Now, wines from Kingsley Brown's Cote St. George vineyard near Antigonish, which has no winery store, can be available to local restaurants. And, hopefully, Domaine de Grand Pre, St. Famille and other wineries that have resisted listing most of their wines at the NSLC, due to excessive mark-ups, will now be available to more Nova Scotia oenophiles.

"Buying local" is a current foodie trend, and this new mark-up policy should help bring it to the Nova Scotia wine industry.