Skip to main content
Advertising

Originally published Saturday, July 28, 2012 at 8:00 PM

  • Share:
           
  • Comments (3)
  • Print

Seattle's Precept Wine brims with growth across Northwest

Since April 2011, Precept Wine has purchased three Northwest wineries — Sagelands and Canoe Ridge in Washington, and Ste. Chapelle in Idaho.

Seattle Times business reporter

Precept Wine in brief

Headquarters: Seattle

Employees: 300, including 50 in Seattle

Revenue (2011): Nearly $50 million

Vineyards: 15

Wineries: 8

Brands: 28, including 10 core Northwest brands. They are Apex, Waterbrook, Canoe Ridge Vineyard, HOUSE, Washington Hills, Sagelands, Willow Crest, Primarius, Ste. Chapelle and Sawtooth Estate Winery. Precept also has a joint-venture partnership in two Australian brands, Shingleback Estate Winery and Red Knot.

Production: 850,000 cases in 2011. Purchase of Ste. Chapelle adds an estimated 130,000 cases in 2012.

Vineyard acreage: 3,796

Source: Precept Wine

Most Popular Comments
Hide / Show comments
Washington wine is poopy wine, made for guzzling. Like 3 Buck Chuck. MORE
@ Roberto...Poopy wine?...Really?... MORE
@Roberto - You are apparently not drinking the same WA wines that I am. I agree that... MORE

advertising

BENTON COUNTY —

The Canoe Ridge Vineyard is rooted on the slopes of the arid Horse Heaven Hills, about a mile north of the Columbia River, and 20 miles south of Prosser in Central Washington. It is one of 15 vineyards owned by Seattle-based Precept Wine, a rapidly growing company with vineyards and wineries across the Northwest.

Here at Canoe Ridge the mostly Spanish-speaking workforce tends to grapes destined to become cabernet, chardonnay or merlot. The workers trim the leaves around these pea-sized morsels to ensure the fruit attains its ideal flavor. Most important, during dry, hot summer days, they keep the irrigated water flowing.

"You have to have their feet wet," said vineyard director David Minick, referring to the roots of the vines.

The keen attention to the health of these grapes is critical to the quality of the final product. It's all for nothing, however, if that eventual bottle doesn't find its way onto a dinner table.

Precept Wine CEO Andrew Browne, says that, despite the complexity of producing a bottle of a Washington red or white out of the foliage of these hills, it's what happens further down the line that keeps him on his toes and is critical to success for his growing wine company, Washington's second largest.

"If you don't get in front of your distributors and restaurateurs, they forget about you," Browne said. "You go to a distributor that may have 300 other wineries."

Browne says that keeping the attention of his network of wine distributors takes considerable diligence, like cultivating sensitive cabernet grapes.

And the bigger Precept Wine is, the easier that challenge becomes.

It's one of the reasons Precept, which ranks behind Woodinville-based Ste. Michelle Wine Estates among the state's wine companies, is in a growth spurt.

Buying spree

Since April 2011, Precept Wine has purchased three Northwest wineries — Sagelands and Canoe Ridge in Washington, and Ste. Chapelle in Idaho.

With these purchases, the private company — which had sales of just under $50 million in 2011 — has the clout to successfully promote its mostly $15-and-under bottles.

Ste. Chapelle — Idaho's largest winery, which Precept acquired in May — produces roughly 130,000 cases of largely sweet wines annually. That pushes Precept's total production to nearly 1 million cases each year.

Cyril Penn, editor of Winebusiness.com, says the million-case mark is not only a round number, but also the threshold a wine company must achieve to start demanding the attention of its distributors.

"The medium-sized wine companies kind of get pushed off the shelf and have trouble competing," Penn said. "You really have to get to a million cases to have clout."

Precept Wine is not alone in the business of Washington wine acquisitions.

E&J Gallo Winery, by far the nation's largest wine company, purchased Woodinville's Columbia Winery in June.

At an annual production of 70 million cases, the Modesto, Calif.-based Gallo has the resources to rapidly turn Columbia into a bigger player, Penn says.

"They could make Columbia into a million-case brand because they have the muscle," he said.

In the long run, Gallo's purchase of Columbia could be a good thing for Precept and other Washington wine companies. That's because Gallo has the capital and distribution network to promote the Washington name in new markets around the world.

"Short term, there might be some direct competition for supply, but over the long term it's a net benefit," Penn said.

As Penn sees it, however, the tension in this game is that customers prefer to drink the vino that comes from small mom-and-pop wine operations.

Accordingly, the Gallos of the world promote the names of their individual labels rather than the company.

"Everybody wants to pretend they're small in the wine business," he said.

Company's origins

Precept Wine began small in 2002 when Brown partnered with Dan Baty, a Washington wine entrepreneur with whom he had worked in the past. But they quickly lost their diminutive street-cred with rapid growth through the acquisition of other Northwest labels.

In 2009, Minick, the director of Precept's vineyard operations, owned Willow Crest Winery in Prosser, Benton County.

Precept, which had already been helping Minick market his product, bought a majority stake in the company that year.

The purchase was a relief for Minick.

A lifelong farmer, it freed him to focus on the cultivation of the vines without the distractions of accounting or engaging a network of distributors.

"A distributor has to be managed; it's a relationship," Minick said. "That's what Precept does."

Wine distributors have a variety of responsibilities. Not only are they the individuals who visit grocery stores and restaurants to hawk winemakers' products, but they also negotiate the regulatory frameworks that various states impose on wine.

In addition to clout in the grocery aisle, Precept Wine's recent acquisitions often offer other benefits.

In particular, the purchase of Ste. Chapelle Winery gives Precept a stronger foothold in the burgeoning Idaho wine sector.

While Idaho's total production is minuscule compared with its neighbor to the west, its Snake River valley, near Boise, is similar in environment to prosperous wine regions like the Walla Walla Valley in Southeast Washington.

Precept CEO Browne is bullish on Idaho's wine potential.

"I think Idaho is in its infancy, like Washington was 20 years ago," he said.

Christopher Chan, executive director of the Seattle Wine Awards, echoes Browne's assessment. "I think Idaho is underappreciated," he said.

But he adds that, so far, the state's potential hasn't been acknowledged by most of the wine-drinking world.

"No one's respecting Idaho," Chan said.

Who's next?

After incorporating Ste. Chapelle, Sagelands and Canoe Ridge into the Precept fold, the question becomes: which winery is on deck in this consolidation spree?

Browne says there are no new acquisitions on his mind. Precept Wine's 12 core brands fill most wine niches in the $15-and-under wine spectrum.

Browne emphasizes that he wouldn't want two in-house brands to compete. When prodded, however, he acknowledges there's always the possibility for newcomers as the markets evolve.

"In the long run, maybe I do need some other locations," Browne said.

Karl Baker: 206-464-2046 or kbaker2@seattletimes.com

News where, when and how you want it

Email Icon


Advertising