Corona Economy
The Coronavirus is having significant impact on small businesses around the world and wineries are not immune to the pandemic. For our latest entry in the spotlight series, we spoke with Windy Oaks winemaker Spencer Schultz about the impact thus far from lockdown:
Winescribes: How has the last month changed your normal daily routine as a winemaker?
Spencer: Luckily, the last month hasn’t changed my routine very much at all. We only had one or two part time employees (besides the family) before the pandemic, so it has been pretty easy staying isolated up at the winery, especially due to our remote location.
A small change is that usually I work a few days a month in the tasting room; I do miss connecting with our customers over a glass of wine. Being a small family business, I usually work face-to-face with my parents every day. However, we now do things over the phone or at a distance outside. It has taken a little getting used to but we are adjusting.
What are the immediate effects to your business?
The immediate effects to our business were closing the tasting rooms and a small loss of wine club memberships. However, a positive immediate effect has certainly been a huge uptick in sales. We feel very lucky to be part of an industry that is supplying some relief to people stuck in their homes for long periods of time.
What about the long term effects?
The long term effects are hard to tell this early. We are certainly looking (as always) at our approach to marketing and evaluating how tasting rooms will be effected in the long term, even when they are allowed to open. It’s difficult to understand how society’s approach to public gatherings and shared social spaces will change, if at all.
One of our primary focuses since starting Windy Oaks has always been expansion of our wine club and direct to consumer sales. This whole situation has certainly reminded us that these are crucial parts of our business model, so we are brainstorming on ways to further these goals.
What changes, if any, are you implementing to cope with the crisis?
Some changes include offering curbside pickup at our winery in Corralitos, expanded sanitation practices at the winery and tasting rooms, and alternative marketing methods during this crisis.
What about your employees? I imagine closing the tasting rooms has lead to some uncomfortable conversations..
I think our tasting room employees understand that our actions are in accordance with local regulations, and they have been very understanding. It is certainly an unfortunate situation for so many people around the world right now, especially those in the service industry.
We are donating a portion of our sales during this time to help ease their burden, and they are taking advantage of the added unemployment benefits from the stimulus package. These things do not make up for the tips and commissions they are losing, and the sheer boredom of not going to work every day, but we are doing what we can to help them during these times.
What are some problems that a boutique producer like yourself may face during the pandemic?
Some problems for a smaller producer are certainly cash flow and uncertainty for the future. Many smaller wineries (even successful ones) that don’t have deep corporate pockets can find cash flow to be a constant challenge. The costs of running a small business, and especially one that involves farming, are always high and margins can be thin.
We are very fortunate that our wine club is the core of our business, as opposed to a distribution heavy business model. Despite losing about 30% of our members during the 2008 recession, it was the remainder of the wine club that kept us in business during those tough years.
Our wine club has largely expanded since then so we hope we can make it through this crisis as well. One bright spot for smaller businesses right now is that the stimulus package has made borrowing money very cheap, and this is certainly a good option to have if things get really rough.
What problems will the larger production facilities face?
I think one of the main problems larger wineries might have is personnel. Obviously, the larger the business, the more employees are needed.
The day-to-day operations of winemaking are very labor intensive and time sensitive. Certain jobs require multiple people working in close quarters and most can’t be done remotely. I wonder how some of the larger operations are dealing with social distancing and loss of labor due to sickness during this pandemic.
Another problem larger wineries could face in the short term is sales. Many of the larger wineries depend heavily on distribution channels to sell the majority of their wine. The closure of restaurants and bars could certainly be a challenge for them.
Q: How can people still buy and taste the wine of Windy Oaks during these times?
We are happy to offer free shipping on all orders, and free delivery in Santa Cruz and Monterey County. People can always call Judy at the office (831) 724-9562 to place an order directly. Email is great as well judy@wowpinot.com. They can order through our website Windy Oaks Estate – Fine Pinot Noirs & Chardonnays
They can also DM me on instagram @windy_oaks_estate. We are offering curbside pickup at our Corralitos tasting room on Saturdays from 11a-3p at 550 Hazel Dell Road, Watsonville, CA 95076. We cannot offer tastings for the duration of this crisis, but if anyone would like to do a virtual tasting, that is an option that could work!
The best way to support the wine industry is to keep drinking! Thank you to all the people that have been ordering wine during this crisis!
