Selling Value

When you first walk into Bottle Barn, the phrase you may initially think of is ‘€œno-frills.’€ The warehouse-like environment is played out in what appears at first glance to be a loosely organized concept. Moreover, lots of product is floor-stacked around the store’€™s ample selling space and much of the shelving is industrial. Even some of the huge wine selection is case-stacked, though there are aisles of wooden bins and racks also filling the store.

But look a bit closer and you will see First Growth Bordeaux, top-rated Burgundies, great Barolos, wines from Spain, Australia, Germany, Austria, and South Africa.

Then there are the wide array of spirits: for example, the range of cognacs, from major brands like Courvoisier and Hennessy to numerous smaller houses; an extensive selection of varied single malt Scotches, and scores of craft brews from some of the hardest-to-find brewers in the country and from around the world.

Indeed, those who shop here know that Bottle Barn is a superb fine wine, beer and spirits shop that offers some of the finest brands and specialty items you can imagine.

Despite this extensive inventory, wine remains about 70% of the store’€™s stock and even though the front of the place carries bins with $4.99 wines of quality (some of which once sold for $15), you can get the best of the best: ‘€œWe get a full allocation of DRC,’€ said wine buyer Ben Pearson, of Domaine de la Romanee-Conti.

Regulars know, however, that they will have to ask for what they want. A few specialty items are held in the rear of the store and sold only on request. The reason is price. Almost everything at Bottle Barn is sold at discount, and in some cases the price is actually less than some wholesale warehouses.

Another reason to assume this place is industrial: it’€™s located at 3331 Industrial Drive in Santa Rosa, literally in the heart of Sonoma’€™s wine country, midway between the southernmost Carneros hard by San Pablo Bay and the northernmost Alexander Valley, butting up against Mendocino County.

As its name implies, Industrial is a street that gets no foot traffic. You have to get good directions or have a GPS to find Bottle Barn. But once here, it is clearly worth the search.

The Store’€™s Strengths

A number of features set Bottle Barn up as a model wine, beer and spirits shop, and they range from selection to storage conditions, quality of staff, discount pricing on almost everything, and the fact that it knows its clientele.

From all this, and from the fact that Sonoma County is a major tourist destination for those seeking to try wine in tasting rooms, you might assume that the primary customer is a day-tripper from San Francisco. Just think of the possible scenario: a couple visits Russian River Valley and tastes a local Chardonnay at the tasting room that sells for $30 at the winery. But Bottle Barn has the wine for $22.99, so they eschew the winery sales room and stock up at Bottle Barn.

Well, that little scenario rarely happens. Only dedicated wine seekers know about Bottle Barn, which store manager Jason Schneider is hoping to change. Rather, the most reliable customers here are those who work at nearby wineries: winemakers, cellar crew and winery owners.

‘€œWe have a large import section because winemakers are really into these kinds of wines,’€ said Pearson. Those who make Pinot Noir near here love buying Burgundy, for instance.

One interesting recent development: In the last two years, Pearson has increased the size of his German import section nearly three-fold to make it as large as any import he carries.

‘€œRiesling is the world’€™s greatest white wine, and it’€™s a very dynamic situation right now,’€ he said. ‘€œIt’€™s hard to keep the great wines in stock.’€

At a recent German wine symposium and tasting in San Francisco (50 miles south of Santa Rosa, across the Golden Gate Bridge), Pearson was one of the few retail buyers in attendance. Most of the attendees were sommeliers.

Spirits, too, represent a major section for the store, since winemakers like other beverages. This includes vintage Port, Sherries and Scotch and all sorts of other dessert items.

‘€œPart of the growth in this area,’€ said store manager Jason Schneider, ‘€œis related to the return of the cocktail, and specialty mixed drinks that customers have at local restaurants.’€

He said that as the number of top-rated restaurants in Sonoma County has increased, and diners are having some drinks made with exotic spirits, ‘€œthey come in here looking for these items, and we have them,’€ said Schneider.

He added that Bottle Barn does ‘€œway more business with craft beers than ever before. The category is on fire, and we have a dedicated beer buyer, Zack Shelton, who is always searching for those hard-to-get craft brews.’€

Among the top sellers in this area, he said, are beers from brew master Vinny Cilurzo at Russian River Brewing, just a couple of miles south in downtown Santa Rosa. RRB is one of the top brewers in the country, notably for Belgian abbey sales, and Schneider said he carries five of RRB’€™s Belgian ales along with esoteric beers such as Pliny the Elder ‘€” which is in such demand he said the store allocates purchases.

Bottle Barn may look like a warehouse, but the place is temperature controlled; most wines are lying on their sides, and the low light is intended to avoid the situation where wines in clear glass bottles end up suffering a matchstick, sulfur aroma from being lightstruck.

Balancing Price

Pearson says one of his draws is price. And this is an area that requires a great deal of thought and creates for Ben and his team a sort of delicate balancing act.

‘€œWe like to work on a 16.5% margin,’€ he said, ‘€œwhich means that I’€™m always negotiating what I can sell something for without upsetting the wholesalers and the wineries around here.’€

Though he is located in California and can legally buy wine from wineries, about 70% of his stock is from wholesalers with whom he works closely. He doesn’€™t have the many-thousands-of-cases buying power of a major retail grocery chain, so must pick and choose carefully.

Some of the most popular wine brands, which can often be seen in large chains, might be no-shows here. Instead Bottle Barn has the ‘€œspecials’€ that sit in the front of the store, just after you enter and pass the checkout counter.

This is due to Pearson’€™s proximity to hundreds of wineries and his personal contact with as many winemakers. This personal relationship with winemakers lets him hear of odd lots of sensational wines that are too small to be sold through traditional channels.

Result: Bottle Barn ends up with a few hundred cases of items that it discounts so deeply that they sell out in weeks or days. These might include some local wines made in amounts too small to appeal to a major supermarket. They could also represent items made from grape varieties that don’€™t have instant eye appeal, such as a Lagrein, a Silvaner, or a Primitivo.

Unlike Trader Joe’€™s, which sells a lot of the wine it buys in huge amounts under its own brand, Bottle Barn prefers to use smaller lots of wine that represent sensational value, even if the wine runs out of stock quickly. And the wines usually carry the label of the producer.

Pearson’€™s philosophy is simple: if it sells out, there will be another wine right behind it that is just as good ‘€“ or even better.

Bottle Barn doesn’€™t have a very visible web presence, in part because both wholesalers and wineries would rather not have certain products widely advertised at the low prices the store offers. ‘€œIn that regard, we tend to fly under the radar a bit. We don’€™t want to upset our suppliers,’€ said Schneider.

Hot Spirits

The hottest items these days in spirits, said Schneider, are vodka, bourbon and rye whisky. Of the commercial brands of vodka, he said, the top are the three S’€™s ‘€” Smirnoff, Stoli and Svedka, with Grey Goose and Ketel One topping the premium brands

Among bourbons, there are traditionals like Jack Daniels, Jim Beam, Ancient Age, and premiums, like Bulleit, which Schneider said is ‘€œon fire right now, as is Buffalo Trace.’€

As to pricing of spirits, ‘€œwe are discount-oriented there as well, and with some of the 1.75s, we work on only a 13% margin ‘€“ we want to stay competitive with the Costcos of the world.’€ But again, the word isn’€™t widely spread on such things.

He is as surprised as Pearson at the rebirth of interest in Riesling. ‘€œWe couldn’€™t sell Riesling 10 years ago. Now Ben spends a good deal of time tracking these things down.

‘€œWe may not ever do the volume with those wines that we do with others, but the image of the store is important, and our customers want these wines.’€

The store is not greatly interested in doing much internet, online business at the moment. ‘€œYes, we could improve in that area, but we have to be careful.’€

He said most distributors with whom Bottle Barn works ‘€œseem to want to please Safeway and Costco any way they can and the last thing they can afford to do is get thrown out of those places, so we have to have a low profile in many ways.’€ As a result, if Bottle Barn has a price lower than Costco on a particular item, it will not advertise the fact.

Bottle Barn was bought by current owner Bruce Emmons in 1990. Schneider said Emmons is always looking for ways to expand image the company’€™s image.

But until now, there has been little negative consumer feedback on the warehouse-like image.

Schneider said he and his employees have strategized ‘€œhow to make it more shop-able,’€ but added, ‘€œmaybe how we look is part of the charm. Sort of, it is what it is.’€

And what it is is great value, huge selection, and a friendly staff.

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