Where To Find Wine Fire Sales

As the economy tanked, oenophiles continued to drink--but with cheaper wine.

The "2009-2010 State of the Wine Industry," an April report by the Wine Division of Silicon Valley Bank, called Q4 2008 "the worst Q4 in memory for the fine wine business," adding that for all U.S. wine purchases, "price points below $35 are selling, but wines between $50 and $125 are in a "dead space."

In warehouses across the country, cases upon cases of high-end wine are collecting dust. And with grape harvests in the U.S. and Europe imminent, there's only one thing to do: hold a fire sale. For consumers who want to get a taste of, or stock up on, some of the world's best wines at a big discount, now is the time. For the past couple months, wine shops have been offering unprecedented deals.

"From a retailer's standpoint, we did a liquidation six months earlier this year," says Daniel Posner, owner of Grapes The Wine Company in White Plains, N.Y., which sends daily e-mail offers to regular customers. Meanwhile, the distributors, he says, "were waiting out the storm, and it just blew up in their faces" as the recession ran deeper and longer than they expected and their inventory didn't move. Instead of reducing prices six months ago, they're slashing them now, desperate to clear space.

So much so, that the deals they're offering to retailers--and, in turn, consumers--are borderline comical. Once highly allocated Cloudy Bay sauvignon blanc, the flagship wine of New Zealand, sold for $30 and up in the 2007 vintage; some retailers are selling the current-release 2008 for $20 per bottle (the average, according to WineSearcher.com, an online database, is $26).

But the high end is where the real bargains are. Union Square Wines in New York is selling 2003 Chateau de Valandraud from Bordeaux for $80; the wine was released three years ago at $250 per bottle.

At the time the Valandraud arrived in his store about a month ago, Jesse Salazar, the wine buyer for Union Square, said that he'd been getting daily calls from distributors hoping to shed bottles that haven't been selling due to the economy. Consumers closed their wallets for trophy wines, and the distributors were being forced to take what little money they could get.

"Just about every wholesaler has done a closeout in the past month," says Posner. "And negotiations are wide open." He also claims to get at least one fire-sale offer a day, sometimes more.

Among the more eyebrow-raising deals he's seen in the past several weeks have been half bottles of Joseph Phelps Insignia Napa cabernet 2002, Wine Spectator magazine's wine of the year, wholesaling for a mere $10 each (the wine's release price for a full-size bottle was $150; retailers jacked the price even higher once the wine received its distinction). While he missed out on that one (another retailer snapped it up before Posner could), he did get a 1999 Louis Jadot Gevrey-Chambertin (a small-production, highly sought red Burgundy that usually sells anywhere from $40 to $80 at retail) for $6. Another $65 wholesale Burgundy was picked up for $15 per bottle.

The better the deals, the less time they last--savvy consumers are clicking the "buy" button quickly, with some supplies lasting only a couple hours, says Posner, who, like many retailers, offers deals both in store and online. So the key to scoring a steal is getting on reputable retailers' e-mail lists--and not hesitating. If the offer is too good to be true, well, it's not only true, it'll disappear quickly.

How long will the fire sale continue? Posner's best guess is at least through the end of September, before consumers--in theory--start to buy more wine for the holidays with less price consciousness. But that's just a hunch, having never seen an environment like this in the nine years he's been in business.