Grape prices are tumbling. Wine loving Baby Boomers are cutting consumption. Millennials are downing shots and chugging craft beers, and according to a respected source in the winery finance business, half of U.S. wineries may be sold in the next three to five years. While the Hedge Funds and conglomerates have the resources to ride out these disturbing trends, any individual or family jumping into the business in this climate appear to be on a financial kamikaze mission.
. Naming the operation was the easy part, but there were plenty of upfront challenges: an outdated tasting room, a smaller production facility, and distinctly slower pace in their new neighborhood. Contractors and inspectors operated on what Beth politely calls “Amador Time.”
Which brings us to Tom and Beth Jones, two wine industry lifers and fearless operators, who six years ago, cashed in their stake in California’s El Dorado County’s growing Lava Cap Winery. Rather than monitor their investments and work on their golf game, the couple left a big family business to start up a small one.
Huh? As Tom relates, bigger isn’t always better.
“You reach a scale where you’re forced to become managerial rather than in the cellar, intimate with each barrel. I prefer to be up close and personal with our wines, and that requires a boutique scale and operation.”
It wasn’t just some sort of Foothill Family Feud that prompted their exit. Tom and Beth saw wholesale changes that made even successful wineries fight and claw for market share. While 1,800 wineries had 3,000 distributors to choose from in the 90’s, California’s wineries numbered more than 8,000 a decade later, while the number of distributors diminished to some 700. While Tom and Beth took their time discerning how and when to leave the family business, they never considered leaving the wine business.
Beth Jones explains it this way: “It’s so exciting to see something grow from the ground up; the harvest, fermentation, the bottling, the aging and finally the presentation in the tasting room.”
Like their carefully crafted wines, the new Jones business plan took a few years to mature. After a multi-year search, they found a hidden gem – a once thriving winery that hadn’t changed with the times. The price was right, and so was the location, a picturesque hillside in neighboring Amador County. They set up their operation in Plymouth, California, a leisurely forty-minute drive east from Sacramento.
“Amador had that feeling that we really wanted to get involved with,” Beth says, “a positive outlook overall, many inter-generational families that are very active in winemaking and the community.”
After Tom — an inveterate hiker — stumbled upon a relic from the Gold Rush days, the hub of a wagon wheel, the venture was christened: