Sideways

“By making this wine vine known to the public, I have rendered my country as great a service as if I had enabled it to pay back the national debt.” — Thomas Jefferson

A few weeks ago, Jeanine and I visited her friend that lives in Northern California. The friend’s partner is a small business owner and operates a landscaping company that provides vineyard maintenance to backyard vineyards. I didn’t know that this specialty existed within the landscaping genre until meeting her so I was full of questions as we sat around drinking a nice bottle of wine that evening.

I learned that vineyard maintenance is primarily a service offered to wealthy people growing grapes in their backyards. They like the novelty of owning a vineyard but don’t want the hassle of maintaining it. This friend found a niche and a thriving business servicing this affluent clientele.

I view wine appreciation as one of those things that separates big money from the rest of us. Jeanine and I think we’re breaking the bank when we buy something for close to $20 a bottle. Typically, we’re happy in the $8-$12 price range at Trader Joe’s and occasionally we wine taste at our local wine shop and stock up on a deal.

So last night while drinking an exceedingly sweet Chardonnay on my flight to DC, I was educated on how to turn great wine into a great investment. I learned all this from the AA Celebrated Living magazine… I scored an upgrade and was sitting in business class. It’s fun to skim this publication for what I call wealthy money articles. This trip didn’t disappoint. Peter D. Meltzer outlines the fine points on wine investing in his article called, Banking on Wine.

Rule #1 he writes, “I have always believed that wine is best appreciated in the glass, so if speculation is your goal, be prepared to drink your investment in the event of a market collapse. Second-guessing a wine’s investment potential is inherently risky. Several highly praised vintages have turned out to be less than stellar. If profit is your motive, there are better investments.”

“The mechanics of creating an investment-oriented cellar are simple enough. Buy a highly rated wine, either as a future (an offering made through retailers in advance of a wine’s bottling) or immediately upon release. Store it carefully for several years until it approaches maturation, and then sell it at auction. Take advantage of periodic lulls in the salesroom and snap up lots that are trading below recently realized price levels, or hedge your bets on classic older wines that are likely to enjoy continued longevity.”

“If you are contemplating a $10,000 outlay, you are generally better off buying four $2,500 cases (or two $5,000 lots) than purchasing ten $1,000 cases. Wines in the upper echelon of the price spectrum tend to appreciate by a greater factor than those in the lower ranks. No all wines appreciate equally.”

Sandra Block at USA Today ran a few tips a couple of years ago in her article called, An Intoxicating Investment.

1. “Bordeaux wines from established, reputable companies are the equivalent of blue-chip stocks. There’s a strong resale market for the wines because they have a record for consistent quality and age well.”
2. “If you’re interested in cult wines ” hard-to-find wines from small vineyards ” visit the vineyards and ask the owners to put you on their mailing list.”
3. “Make sure your wine is properly stored and insured. Poor storage can destroy expensive wine.
Understand that even good wines don’t last forever. You should open a bottle every few years to make sure it’s still good.”
4. “Invest in wine you like to drink. If the wine falls out of vogue, you don’t want to be sitting on something you don’t like.”

She suggests two sites to get more info: Wine-searcher.com and Winebid.com.

If your investment doesn’t pan out, then just bite the bullet and drink up.