Innovation and acquisitions at the heart of the strategy of vintage wine estates

After 30 years of working in the wine industry, Terry Wheatley, President of Vintage Wine Estates, and her team took the company public in June 2021, making her the first female president of a listed U.S. wine company. in stock exchange. The $690 million IPO was completed after a merger agreement was struck with London-based Bespoke Capital Acquisition Corp.

Now, after just over a year at the helm, and despite a tough stock market and supply chain issues, Vintage Wine Estates’ revenues have grown 33%, closing fiscal 2022 at $294 million. dollars. In a recent interview, Wheatley reflected on his first year and described the strategic elements that have made the company successful to date.

“Our key strategy,” Wheatley said, “is to grow through innovation and acquisitions. As a company, we’ve made 20 acquisitions in the past 10 years, and we’re continually developing and launching new brands.

Some of the best-known wineries in the Vintage Wine Estates (VWE) portfolio include Clos Pegase, Girard and Swanson in Napa Valley; BR Cohn and Kunde in Sonoma County; Laetitia in central California and Firesteed in Oregon. In total, VWE has more than 60 wine and spirits brands totaling approximately 3 million cases per year, making it the 14e the largest wine company in the United States. Brands range from $10 to $150 a bottle.

“We have something for everyone’s price and the ability to reach 13.5 million cases,” Wheatley said. “A lot of people don’t realize that we actually have three divisions within the company: our wholesale group, a direct-to-consumer (DTC) group, and our B2B division. We call this our 3-legged stool, with about 1/3 of our business coming from each division. »

The B2B group focuses on the production of private wine labels. For example, VWE works with supermarket chains and other retailers to create store-owned wine brands. They also create special occasion labels, through Windsor Vineyards, for individual consumers who may request a label for a wedding, birthday or other event. VWE also bottles wine for other wineries.

This type of diversification is rather rare in the wine industry and offers more flexibility to VWE. “That way,” Wheatley explained, “if one division is down, like the onsite part of wholesale during the pandemic, we still have other divisions to focus on. For example, last year , our DTC segment grew 39%, primarily due to increased tasting room traffic and our strong digital presence.”

Components of the acquisition and innovation strategy at VWE

When analyzing an acquisition opportunity, Wheatley said they have a team reviewing the prospect to ensure it will be complementary to the full portfolio. “We’re looking for acquisitions in all three areas of the stool,” she said, “and the acquisition has to bring something to dance that we don’t currently have.”

The acquisitions appear to be paying off, as VWE’s fiscal year 2022 report indicates that the year’s acquisitions resulted in an $11 million increase in revenue. However, acquisitions are only one element of VWE’s strategy, with innovation and organic growth being other elements. And when it comes to talking about innovation and brand development, Wheatley’s voice takes on an extra note of enthusiasm. Perhaps it’s because of his strong background in wine marketing, with previous roles at Sutter Home, E&J Gallo, and launching and then selling his own successful business, Canopy Management.

“Innovation is my wheelhouse,” Wheatley said. “That’s what I like to do. I really enjoy working with my team on this. I’ll pitch a possible brand name, and we’ll tell a story. I am continually innovating… when I come home at 7 p.m. every night and dry my hair in the morning.

One of the recently developed brands of which Wheatley is most proud is Bar Dog, which is sold in Safeway, Target, Total Wine and many other stores, as well as online. “The brand is selling very well,” Wheatley reported, “with some of the proceeds from sales going to support nonprofit rescue shelters.”

Fortunately, there seem to be plenty of opportunities to keep innovating at VWE. “Because of our B2B business, we are continually asked to develop new brands for large retailers,” Wheatley said. “It gives me great joy.” The company is also expanding into cider, dealcoholized wine, gin, whiskey and CBD projects.

Helping Women Succeed in the Wine Industry

One aspect of Wheatley’s career that many in the wine industry admire her for is her strong support for helping other women succeed. She started Wine Sisterhood, an online community that offers women who love wine a space to network with each other. She also serves as a mentor to other women and has made it a point to hire and promote women to leadership positions.

“More than half of our management team is made up of women,” she says proudly. “And the whole marketing department is female. However, it’s important to remember that you need good male peer support to be a successful leader. Fortunately, our CEO, Pat Roney, has always been a big supporter of women in leadership positions. »

To date, Wheatley’s strong leadership and focus on innovation appear to be paying off. In October 2022, she was named to the Forbes “50 Over 50” list. She was joined by a group of other high-profile women, such as Supreme Court Justice Kentaji Brown-Jackon, Dolly Parton, Tory Burch, Sandra Bullock, Martha Stewart and Tina Turner.

Previously, Wheatley was named “Innovator of the Year” by Passionate about wine for his career-long dedication to innovation in the wine, spirits and beverage industries. She was also recognized as one of the “Most Innovative Women in Food and Beverage” in the wine industry by Wealth, VALUE and Food & Wine magazines.

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