Episode Transcript
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This is the Napa Valley Insider Podcast brought to you by Cuvée, the Napa Winery Guide, in
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partnership with Highway 29 Media.
All right, all right, all right.
Welcome back to another episode of Napa Valley Insider.
I am Andrew Allison.
I am the CEO of Cuvée, a Napa Winery Guide app, and we make this podcast in partnership
with Highway 29 Media.
Today I'm so excited to meet our guest, who are you, and what do you do?
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Thanks great to be here.
My name is Ian Dooley.
I do business development and winery accounts with Free Flow Wines here in Napa, and we
also have a facility over in Bayonne, New Jersey.
I am so excited to talk sustainability in the wine industry with you.
I think when we initially met, some of the things that we covered were so interesting,
I thought that anybody in Napa Valley should just have some awareness, so I'm very grateful
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you decided to join us today.
If you don't know anything about sustainability trends in Napa Valley wine, what are the high
notes?
Yeah, I would say there's been a very good focus placed on the vineyard side locally
in Napa Valley.
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So there's been a lot of attention made to that for wine quality reasons as well as sustainability
reasons, but ultimately a winery's single largest footprint is the packaging.
So I think sometimes the consumer doesn't know that, and it's also a difficult thing
to improve.
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So the bottle is the way things have always sort of been done and are most commonly done,
and it's not going anywhere.
But all the work that's being done on the focus and the desire to improve sustainability,
at the end of the day, the package is still the single largest contributor to carbon emissions.
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And across the wine industry, you mean?
Yeah, absolutely.
And so I think, let's go back to the first thing that you touched on, the agriculture,
the viticulture practice.
Coming up in Napa, the Napa River used to have a really bad reputation for both the
runoff in pesticides and everything that's in the viticulture process where it's now
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going into the water system, and then on the actual ways that facilities used to be cleaned.
I mean, people used to use bleach and everything else, and that would all go into the runoff.
And so what are some of the major things in packaging?
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Because I think it's really well documented that viticulture has cleaned up its act in
many ways, especially if you want to get some of those certifications, Napa Green or the
biodynamic processes or anything that's pretty well documented at this point.
What are some of the things that many people don't think about in packaging that makes
packaging such a high carbon emission?
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I think you have to kind of just go 30,000 foot view and just think of all of us.
We're putting plastic, glass, cardboard, we're putting it in the blue bin, doing my part,
all is good, right?
Unfortunately, it's not always the case or rarely is the case.
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Only about 20 to 30% of glass is actually recycled.
And then the energy and output needed to run those furnaces to actually recycle the glass
is pretty intense.
So I just think maybe the knowledge isn't there.
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And it's kind of not really advertised as far as things being marketed as recyclable.
And a lot of times, maybe they technically are marketed as recyclable, whether that be
glass or plastic, especially plastic.
And the percentage of what is actually recycled is actually kind of depressingly low.
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So just to mirror that back, glass is a huge carbon emitter.
And if you haven't had the opportunity to tour a glass production facility, I remember
the first one I went to almost 15 or 20 years ago.
I was blown away at the size of the blast furnace, the amount of sand, the trucking related
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or the harvesting of sand, and then the purity of the sand itself directly impacts the quality
and thickness of glass.
We know people are taking steps to use less glass in their actual production process because
they believe the glass container is still the best way to present their wines.
But when you think about some of the packaging that your business does, tell us a little
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bit of how you're working in your lifecycle to actually help people not use glass if they're
a winery owner.
Yeah.
I mean, as far as we know, we are the only zero waste package to store and sell your
wine in.
So our company exclusively uses 304 grade stainless steel kegs.
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They're 19 and a half liters, so they're the equivalent of 26 bottles.
And the studies we've had done, and as far as our numbers, we've found that the kegs
themselves it's 76% less carbon emissions than a traditional glass bottle.
Now that assumes that's the complete lifecycle.
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So that's the mining of the steel.
And that assumes a 30 year shelf life of the keg, which they can actually be longer.
But for this purpose, it's assuming the keg goes 30 years and is used filled twice a year.
So the only parts that might be replaced are sort of the gaskets and maybe some of the
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ball joints that are in, or the spear that goes into the keg, which is also stainless
steel.
But other than that, you're not filling up recycle bins or trash bins, whether it be
cans, bottles.
So what's the actual use case of using?
I know you said 26 bottles.
I'm just going to say two cases.
Yeah, two cases.
What's the actual use case of two cases of wine?
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Is it like by the glass programs?
Yes.
I think our model fits the best for by the glass programs at restaurants, hotels, parks,
entertainment venues.
And effectively you're low no oxidation through that process because you've got the CO2 pumping
out of the keg?
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The nitrogen carbon dioxide blend, ideally, aka Guinness blend.
You can use nitrogen.
But yeah, the idea is zero oxygen gets in there.
And the shelf life.
If I have a keg, let's say it's two cases, I can pour a couple glasses Saturday night.
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I cannot sell a glass of wine for three, four, five days even longer.
And then I open up that tap, I pour that wine again, and it's just as fresh as it was in
the beginning.
So you're not throwing out any old wine.
And more importantly, you're not serving a bad wine.
So if a customer is buying maybe a nicer Pinot by the glass, and it's not all that it's cracked
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up to be, that's not great for the winery either, who's selling that wine.
And so by the glass programs are coveted by many, many wineries that want to get onto
a restaurant's menu.
Getting on the by the glass program is not only some of the best margin, it's some of
the highest volume.
When you think about this, when is the sustainability component parts?
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Can this impact my P&L as a winery owner in a different way than just saving me on the
actual production side of this?
Am I able to get credits?
Am I able to see a difference in my cogs in somewhere else?
Why do I care?
Yeah, I would say the cost to keg is competitive, if not better than if you're going to bottle
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X amount.
I mean, it's all scalable, right?
But we would receive your wine bottle ready.
And we handle all the labor and the filling and the colas and the compliance and all that.
So,
Oh, so the wineries aren't actually doing the like putting into the container?
We do it for them.
We do offer an offsite program.
If you wanted to go smaller, we would send you the clean kegs.
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And you can know especially here locally, like in Sonoma and Napa, they have restaurant
placements and they just sell directly.
But as far as there's that cost, there's that labor.
And then I think one thing that's not on the spreadsheet when you're looking at costs is
us as a partner helping to just grow the category.
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What's the smallest amount you can do?
Like a keg?
10 kegs?
So our minimum to do full service is what we call it.
We receive the wines 250 gallons.
So that's about 50 kegs.
They're 5.16 gallons.
And then it's 20 kegs minimum to do to fill it your own.
So you actually have to be doing a material amount of volume.
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Yeah, it's got to be considerable.
Am I as a business owner, would I be able to as a winery business owner in this program,
would I be able to get carbon credits or anything else that shows that I'm being more sustainable
besides the goodwill that I can use in marketing and other stuff?
What is the other measurable P&L impacts?
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It's a great question.
I don't know specifically about carbon credits, but I know there's a savings.
It's kind of how much you want to go into it.
I would say a poster child for us would be Tobless Creek down in Paso.
And they figured out how much they would save if they just poured all the wines on tap,
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current releases at their property for visitors.
Interesting for their hospitality.
Yeah.
So I mean, they took it next level.
And they figured out what their savings would be just from packaging and from liquid waste
for wine they wouldn't be pouring out.
So not really answering that question, but they've experienced and have seen significant
savings.
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I think that's actually a really clever use case that wasn't intuitive to me on first
idea of the concept.
But it makes a ton of sense if you've got taps in the back and you're putting them into
decanters or something similar and you're showing the consumer a finished bottle.
The consumer is not going to know that you didn't fill the decanter from an open bottle.
I mean, think of the glass usage on some of the Napa hospitality programs.
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I mean, it must be phenomenal.
Yeah, it's crazy.
And yeah, two things there, like buy the glass programs or they don't ever bring the bottle
to your table to serve it.
And then I just thought Jason Haas there at Tobolus, one of my favorite lines, he said
or he asked, what is the most useless bottle of wine?
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And it's the one that never leaves your property.
You've done all that packaging and you open it there and you throw it away, literally.
So it was really not needed if you think about it.
Yeah, I understand the point.
I think there's still the aging and all the other things that could go along with that.
Again, this is wines to be consumed.
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Yeah, sure.
So does this naturally lend to like a white wine or like how's the aging of this?
If you're not drinking this in the next year, can you put a keg on the shelf for 10 years?
Yeah, absolutely.
I would say not intentionally, but we had a client do a pilot and they essentially forgot
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they did.
They did a dozen kegs of some premium, not Vela Cabernet by the way.
So this is not just a lower tier wine.
Did an analysis, sensory analysis compared to the bottle and it did extremely well.
There was no difference.
It was actually preferred in a blind tasting.
Then we have one client of ours who's a pretty big company and they've done some very detailed
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sensory analysis work.
They've taken keg and bottle right away, keg bottle six months, keg bottle two years, keg
bottle one year and they've analyzed dissolved oxygen, free SO2 and all the winery analytical
things and do a blind tasting and see if there's a noticeable difference, which there hasn't
been.
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That's actually really interesting.
I think the ability to pair it with a hospitality program feels like such an intuitive cost
saving if you can style out the delivery at the consumer's table side experience.
Let me ask a couple of other semi-related or unrelated questions.
Have you done as an organization, have you done any analysis as to how much glass is
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being used in a hospitality program at either one site or across Napa Valley?
Not that I'm aware of, but I'm sure it's pretty staggering as far as how many glass bottles
have you had to add it all up.
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I mean, I think on first flush, this idea that 3.7 million people visit now is a huge
deal, and assuming that they'll get through one bottle a piece, I mean, you know, on the
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face value, it's four to six million bottles in a year that could be removed out of the
ecosystem.
Absolutely.
One of my folks, this has been for former, you know, former hospitality manager here.
Why won't more tasting rooms do it?
And I've gotten a few to embrace it and put it in.
Some were current winery clients that were doing it in wholesale channel.
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So it was a very easy, you know, sort of partnership to do that.
And then a few that were a little smaller but saw the benefits.
But yeah, I mean, I can remember just on a busy Saturday, you're filling up two or three
bins of bottles.
Yeah, sure.
And that was a small property.
I mean, let alone something on like Highway 29, you know.
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Yeah.
And I think maybe a couple of the other questions I really want to ask on is I don't follow
the industry sustainability best practices just because I'm not as active in the space.
I'm not a producer, right?
What are some of the most obvious trends?
I can point to a few that I've heard, but I'm curious, where is the greenwashing happening
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in the industry and where is the actual best practices coming into play?
Where do those two lines meet and where's the gray area?
Yeah.
Well, I would say trend would be the lighter bottle.
Sure.
And it's a no-brainer.
Yeah, totally.
Cheaper shipping and everything else.
Right.
And you know, that's great.
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Like it's better than nothing.
But in big picture, you know, I want to tread lightly here.
I don't think patting yourself on the back for having a 30% less weight glass bottle is
going to really make a significant impact, if you know what I mean.
But again, we need, you know, you start to add up a lot of those things and that's the
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right direction ultimately.
I would say that according to the greenwashing, it's maybe more so on the side of some of
the manufacturers, particularly of plastic, who have marketing materials and market themselves
as recyclable vessels when in fact they're not.
And you know, I don't know legally how you sort of call them out.
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I know there's been some legislation passed in California and you know, things again go
in the right direction.
But when I talk to a winery and they tell me we use this recyclable package and I just
say, well, you know, it's actually not.
I would encourage you to look it up yourself.
You know, don't take my word for it.
But I would say that's where sort of I see the most greenwashing and trying to delicately
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educate without coming across as, you know, I don't want to wag my finger at people.
You know, I'm not, you're not perfect.
You're just trying to, hey, if this cost-wise would make sense and it is this much better,
like I think most people would be open to at least hearing about it.
Sustainability crossed my radar when I was doing my undergrad at Sonoma and Wine.
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And I read this book that was, at the time it was life-changing and it's still something
I revisit every few years, but it was the story of the Foley family and then how they,
you know, went through the process of just changing their sustain...
I mean, the book's incredible.
It's all encompassing.
It's the story of like how Foley got their start and whatnot.
But one of the sections of the book was about their sustainability programming and how they
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scaled it up.
I think the things that I did not know then that I'm starting to understand now and I
do not claim to be an expert, but this idea that oil and gas uses so many of the byproducts
or derivatives of the oil and gas industry actually is what becomes the plastics and
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the containers and the, you know, everything from styrofoam to the plastic that goes into
just about everything is actually coming out of the oil and gas sector.
And I was totally oblivious to that, you know, a couple of decades ago, but I am just starting
to get my head around it.
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When you're talking about some of these packages that actually aren't recyclable, but it's
been strong lobbying, that's actually, you know, really changed this narrative on, you
know, everybody should recycle and it's fine.
I mean, it's mind blowing.
The scope of the lobbying efforts that are going into oil and gas derivatives byproducts
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that are turning into the packaging that touches everything.
And look, I don't even want to, you know, this could be a whole other episode of microplastic
pollution.
It's been proven to be in bottles of water.
So you're telling me that's not in a plastic vessel for wine that has a shelf life.
And I just follow up on what you just said.
It made me think, you know, remember when we were kids and we learned, you know, the
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three arrows, the reduce, reuse, recycle.
And that's a lobbying effort.
Well, recycle is the last one.
But I think with consumerism and, you know, again, this is like a much bigger thing and
I'm guilty as well.
Like, how about we refuse and we reduce and then we recycle?
Not just recycling is the answer, if that makes sense.
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I think the trend that I'm seeing, this is fresh in my mind because I just spent the
last week with all of our partner wineries doing their like quarterly business reviews.
And almost unanimously, they all said that they are going to stop using foils and foil
caps on their bottles.
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Not only is it a cost saving, but it's also a sustainability initiative because of the
amount of foil that they're actually using in their tasting room for the exact same thing.
So that's another trend that we're hearing on our side.
Yeah, good.
And again, like, like these are great.
These are great.
You know, and if it's just getting people to just do that first step, I think is important.
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I think, you know, ultimately, there's also the cost part, right?
So if you figure out how I can save money, and it's also more sustainable, that's I mean,
that's ultimately what's going to get people to embrace more of the alternative packaging.
We know that the millennial and younger consumer, especially Gen Z is leaning into the brand
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story of not only their supply chain, but how things have come to be.
So we know that it's a long term initiative of telling the right story and leaving a smaller
footprint for the next generation.
So I think that it, it all adds up.
And I think every incremental step that a business can make towards sustainability over
a timeline is better collectively for everybody involved in that process.
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I think just the kegs that you've spoken about today are definitely something that's worth
thinking about.
If you're running, just based on this conversation and my hot take, and I don't run a hospitality
program, I've just experienced a bunch of them.
If you're running a hospitality program and you're using a bunch of glass on property,
consider moving to a keg program.
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I think it's, I think it's compelling enough to at least consider or do the math on.
Let's jump ahead.
Let's really talk about some of the greenwashing initiatives that are out there.
What is greenwashing by definition, if you don't even know what it means?
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And then what's the, we covered packaging, but what, what, what and where is it happening
across the wine industry?
Greenwashing is basically marketing or narratives of making significant or legitimate environmental
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or carbon emission savings efforts, whether it's motion-censored lights, packaging, et
cetera.
I mean, there can be many things and companies are taking, they're trying to get good PR,
good marketing off of it.
And unfortunately, there are, there's greenwashing being done and there's actually no significant
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savings.
So it's essentially patting yourself on the back and looking good when there's actually
no action really being done, if that makes sense.
Sure.
So that's the kind of, you know, for the audience, broader sort of broader definition.
When it comes to the packaging, again, I would, in my experience, and I'm not an expert, but
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I've been at this for a few years.
The plastic to me is where it's most rampant with the false claims, especially recyclability.
And what's crazy is an unfortunate is at the end of the day, it's actually just cheaper
for these companies to just make new plastic than to go through the process of actually
recycling the plastic.
Yeah, that makes sense.
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This is, this is an area that I, I just observe.
I spend a lot of my time thinking about hospitality experiences with our business and a lot of
the point to point, the final mile logistics, how do I get from this winery to that winery
or this restaurant to this tasting room, et cetera?
The one that I, I, I know has not been studied or if it has been studied, it's not been widely
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discussed is this, this idea if trucking was not on the road between the hours that tasting
rooms were open, my perception is it would lower traffic significantly, especially a
lot of the agriculture trucking on Napa's infrastructure is, is just really stressing
the system a bit more than Napa's infrastructure can really withhold.
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Napa's visitation is at 3.7 million people a year according to Visit Napa Valley.
And many of those people are coming in, in surge around weekends or long weekends and
there's more vehicles in Napa than the infrastructure can sustain.
Napa's starting to feel like LA traffic and I'm talking LA traffic 10 years ago.
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Oh yeah.
If you've been to LA recently, LA is just exponentially worse than it's ever been.
But that's, that's an aside, but I really believe that we could even help ourselves
with air quality and other levels of sustainability if we move trucking to lower peak times because
they're businesses.
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And if you, if you run a trucking company or if you use a lot of trucking for your,
your wine business, it's something that you could easily ask the vendors to do and they're
going to say, Hey, it's going to cost us more in labor to operate in off hours or off peak
hours.
You're going to make it back in fuel and other places.
So that's a great point.
Yeah.
And I think getting trucks off the road during Friday, Saturday, Sundays, when everybody's
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trying to visit Napa, it's just going to benefit the hospitality programs and it's just going
to benefit the air quality and other aspects that are hard to understand today.
A hundred percent.
And then I would take it one step further.
Personal experience, I used to be a hospitality manager up on a property on Hallamountain
and on a Saturday, maybe there'd be five of us.
Sure.
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And then, you know, we'd sell our master and quit.
We all took our own car.
Yeah, totally.
So we got six, seven cars for just this winery with all one person driving them.
And I think, you know, like that's how many properties are doing that, right?
So you add that to what you just described and we could significantly reduce it.
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Yeah.
I mean, I don't know how to solve carpooling and all of those, you know, component parts
or some people just like have the, you know, security blanket of having their own vehicle
to leave or come and go as they wish.
Like I have a daughter, I get it.
Like, you know, what if I need to get home, et cetera?
But I thought about that back then.
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I think there's so much room to improve a lot of final mile logistics within the Valley
itself.
And I think that it could have a positive impact on people's P&L from a better experience
because it's a horrible experience to be sitting in traffic and you're going about a mile between
Yont, Bill, and Rutherford and, you know, heaven forbid there's an accident or anything
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that stops this major artery.
And it's definitely just something that there's room to improve on and I don't know the fix,
but I think there's many hard to measure or unmeasurable gains in positive experience
of just improving the way that that truck's run around on Friday, Saturdays and Sundays
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in the Napa Valley.
But let's jump to the topic that I just want to ask you to opine on a little bit.
When you're thinking about this opportunity to try kegs itself, what is a good way to
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start?
Is there a varietal that people should try to...
What is the on-ramp?
What is the first pilot?
What is the first thing that a winery owner should consider if they want to consider this
for sustainability or economics or whatever?
When considering a new program, what are the first one, two, three steps that you need
to do to actually consider something new like this?
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Well, I think first of all would be, you know, when I started, we had some lean vintages,
right?
So the wine itself, there wasn't a lot of it.
So how much am I willing to sort of try this out with?
We're different climate now, I think, with what we're reading about in the oversupply
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of bulk and grapes, et cetera.
So I would say that's the start.
You know, I want to case this many cases.
I want to bottle this many cases.
What's the cost of a keg in this process?
Yeah.
So I've got the bulk.
I've got the juice to like, maybe let's experiment with this.
So I think that's the most important part from the winery's perspective.
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Now like as far as what price point, what varietal, we see most common are aromatic
whites, rosés, even now some sparkling.
That's where the by the glass program is.
Exactly.
And it does great on the keg.
I mean, you've got aromatic whites, just they really, really sing out of there because they're
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so fresh.
But I think underrated is reds.
I mean, this is more from the consumer point of view, but how many times have you been
served a warm glass of red wine, whether it's Merlot, Cabernet, Pinot Noir, Red Blend?
And I grew up in a household where my father drank any price point of wine.
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He just loved wine.
It was incorporated with his life.
The thing that was very unpretentious in our house was wine.
The thing that my father always loved was making sure the wine was at the right temperature.
And so my dad didn't care what he drank.
He just wanted to make sure that it was served at the right temperature, whatever it was.
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And so that's one of the only things that I pay attention to.
And I think that was a learned behavior.
Yeah.
And look, it makes a huge difference.
Totally.
I will get back to your question, but I just real quick, we were in Kauai this last week
and there was some nice Pinot there and we were in Kauai.
And you're getting 80 degrees.
So I go to the freezer and I put some ice cubes in the glass of Pinot and my buddy's
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like, dude, you put ice?
I go, yeah.
I go, you should try it.
And he was like, oh my God, this is so much better.
But anyways, temperature is huge, which would be a big benefit of serving it on tap.
But I think you're going to want to test it out.
You're not going to want to just come out of the gates with this huge keg program.
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I think you need to do the work ahead of time.
You need to talk to your distributors, have some accounts sort of wind up.
And know that you've got some channels before just kegging a bunch of inventory.
And then we like our clients and prospective clients to kind of work backwards would be
number two.
And I would imagine that it's very hard and very competitive to get on a taps program
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in a heavily used wine by the glass program.
So I'd imagine it's the real estate.
It is.
Yeah.
Unless there's a hospitality fix where you do have a keg that you're pouring on your
property behind the scenes and putting it straight into a decanter or whatever.
I would encourage anyone that's interested in experimenting to find an easy on-ramp to
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try this idea.
I mean, it feels intuitive to save the glass and cogs for your hospitality program here
in Napa was the golden nugget that I feel like came from this conversation as just an
idea that I hadn't considered.
And so the benefit of the tap is you get that, let's say you get your Sauvignon Blanc placed,
that placement is going to be there for a while.
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You're not facing the hundreds of thousands of bottles for competition.
And then I would just one more aspect of that, because you mentioned real estate.
We tell our winery partners and leads and prospective clients, you have to start looking
at real estate on the bar.
How many beer taps does a restaurant have?
Do they need 12 beers?
How much, what are their two worst selling beers, for example?
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If they would retrofit, just try a white and a red and see how you go and watch your profitability.
Yeah, I mean, we'd need a whole other episode.
I think the distributor relationships on the taps are so much more monopolized than just
the worst selling beers.
But as a prescription-
And they get precisely state to state as well.
Yeah, totally.
Yeah, totally.
As a prescription for this, that feels like an intuitive Achilles heel to hit.
(32:00):
Well, thank you so, so very much for coming on.
How can folks get ahold of you if they want to talk about a program like this?
Yeah, it was a pleasure.
Free Flow Wines, freeflowwines.com.
I'm Ian Dooley, Ian at freeflowwinesplural.com.
And happy to answer questions specifically about just the category in general.
(32:24):
We're always trying to just grow that all, what as I say, a rising tide raises all boats.
So that's where we can be contacted and really appreciate the opportunity to come on with
you guys.
Cool.
Ian, thank you so much.
Again, I'm Andrew Allison.
This is a Highway 29 collaboration and I work on the Cuvée app with an amazing team from
(32:47):
Yonkville, California.
So thank you very much.
The Napa Valley Insider podcast has been brought to you by Cuvée, the Napa winery guide.
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Cheers.