A Good Idea: Small Lot Co-Op
April 24, 2009 by Doug Haugen
Innumerable times, we have been told that there is strength in numbers. There are parables of one stick being easily broken, while a bunch of sticks cannot. There are sidewalk-scurrying activists trying to get massive numbers of people to sign petitions for the environment, world peace, and bike lanes. There are huge savings for buying in bulk, like the Volkswagon-sized boxes of Cheerios at Costco. There are gangs.
The truth of the matter is, there really is strength in numbers. Likeminded folks banding together to achieve a singular purpose have a much higher likelihood of success than each on his/her own. (Don’t believe me? This is how specialized society was formed and mankind evolved.) One example of that was the Joint Operation Agreement (JOA) formed by the Seattle Times and Seattle P-I all those years ago, which allowed costs, resources and the Sunday masthead to be shared by the two, which arguably prolonged the life of the papers much longer than if they had each gone their own way. (RIP, Seattle P-I.)
This kind of CO-OPeration (see what I did there?), allows smaller entities to combine efforts to secure success for the whole. In fact, this is nearly the definition of a “co-op” or “cooperative.”
This clearly excessive introduction and build-up brings me to the real topic at hand (cue the timpini…now!): The Small Lot Co-Op, who defines a co-op as a “system of economic action and business enterprise, characterized by the absence of the profit motive and involving, as its primary function, the distribution of goods and services.”
Isaac Asimov gave the basic writing advice that you have to bring your alien out early. Introduce the big subject, and then you can get back to the other surrounding stuff. So, there you have it. Now, back to your regularly scheduled build-up.
A majority of Washington’s 600+ wineries are what are sometimes called “artisan” or “boutique” wineries. They are the Wally’s Grocery to the industry’s Wal-Mart. They are low-production wineries, cranking out under 2,500 cases per year, and just like smaller class sizes in public schools, the results are often more brilliant. Being a small-lot winery provides its own set of challenges, though. It can be more expensive to make smaller amounts of wine because, for example, the cost of equipment isn’t amortized into revenues from high-volume sales, you can’t swing the bulk discount deals when buying smaller amounts of grapes, and whether you sell one bottle or thirty bottles a day in the tasting room, you still need an employee there from open to close to sell wine while you’re out wrangling grapes.
Back to the alien.
Small Lot Co-Op has engineered a business plan that seems novel only in the fact that it harkens back to age-old ideas: the parable of the sticks. SLCO acts as a sales, marketing and distribution arm for wineries that produce under 2,500 cases. Rather than each winemaker jumping in their car every time they’re asked to do a tasting in Seattle, or each time a retailer needs more stock, SLCO can take care of that easily for all of them. Shared warehouse space, shared marketing (SLCO visits retailers to sell the whole package), and shared distribution reduces expenses while also allowing greater visibility and more revenue for the wineries. Novel, right?
Small Lot Co-Op was the brainchild of Seth Furman [Correction: it was Seth's partner Darin Williams who dreamed this up], who has an extensive background in sales and distribution. By offering his services to a consortium of wineries, everyone wins. Wineries become members in the co-op, and therefore have voting rights. They get to choose who if any wineries are allowed to become new members. And, they’re all Washington wineries.
Here’s where the plot thickens, and the alien is at your back door. On Saturday, April 25, Seth Furman will be hosting a tasting of SLCO wines at Vino Verité in Seattle. This Saturday he will be explaining the approach of Small Lot, as well as pouring a great variety of small producers including Des Voignes Cellars, Heaven’s Cave, Sapolil Cellars, and Patterson Cellars. (I love the Des Voignes San Remo sangiovese, and Heaven’s Cave not only has great wines, but gives all their procedes to charity.)
Understanding the nature of small wineries, and the brilliance of the Small-Lot Co-Op concept, the folks at Vino Verité have decided to do this regularly. On the last Saturday of every month, they will host SLCO for their Saturday wine tastings (which are free!), and SLCO will feature a different Washington State winery. And for this Saturday’s tasting from 4:00 to 7:00, Vino Verité is offering a 10% discount off of bottle purchases of the wines being poured (which includes the above mentioned San Remo!).
If you’re interested in learning more about Small-Lot Co-Op, tasting some great wines with no tasting fee, and getting a discount on wine to take home, you should definitely check it out. If you’re not, then perhapse you should pinch yourself to see if you’re still alive.