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Adaptability, resilience help California wineries survive

2 years later: COVID’s impact on the North Bay economy

Sonoma and Solano counties: Different COVID approaches but similar outcomes

Sonoma has been among the California counties with the most proactive public health measures in the past two years, while Solano County has resisted measures.

How has each industry been faring?

Beyond the human toll, the pandemic, public policy responses to it and consumer reactions have had impacts on employers that vary by industry. We talked to players in several sectors, and here’s what they told us.

Voices of local business

Here are the personal stories of how North Bay leaders have steered their organizations through the past two years. What has changed? What were their worst fears, and how did they face them?

Wine is among the North Bay’s largest industries, and it took significant one-two punches from pandemic restrictions on its major sales channels then sizable losses of grapes to wildfires.

But vintners quickly shifted to other ways to get wines to consumers amid limits on tasting rooms, bars and restaurants, historically major venues for selling fine wine.

“One of the greatest outcomes of this pandemic was the adaptability of the wineries and the resilience at change that's coming that hadn't been there before,” said wine digital marketing futurist Paul Mabray, CEO of Napa-based startup Pix. “And I think you're seeing that manifest this year as they invest in new digital wine club methodologies (and) DTC. Even channel understanding is a whole new horizon for them.”

Direct-to-consumer sales of wine were up 27% from 2017 to 2020 and up 53% over those four years, a compound annual growth rate of 11.2% for that time frame, according to a new report by Napa-based WineDirect and Enologics.

But sales of wine at restaurants and other on-premises-consumption venues has yet to recover, with some California establishments just recently reopening. On-premises wine dollar sales in January nationwide were just 77% of where they were in February 2020, while spirits sales had bounced back to 85%, according to Wine & Spirits Wholesalers of America’s SipSource channel shifting index report released March 7. Wine and spirits sales at such venues had fallen to 42% and 47% of pre-pandemic levels at the low point in February 2021, before wider scale reopening in California and other major wine markets.

Appointments for tastings, previously a frustrating use permit requirement in Napa and Sonoma counties, have become an enduring practice a number of vintners have continued as indoor restrictions on winery hospitality centers lifted a year ago. It’s been a benefit for tasting room managers stretched to bring back or hire staff.

Key North Coast winegrowing areas suffered big hits to tonnage harvested, first because of smoke-damage concerns in 2020 then from drought-mitigation efforts last year. That helped turn a threat of oversupply of high-end grapes as bottle sales growth slowed into move this year when vintners are shopping for excess wine and considering grape-purchase contracts.

But rapidly rising costs for labor, key supplies such as glass packaging and now fuel are making some consider and implement bottle price increases this year.

Jeff Quackenbush covers wine, construction and real estate. Before the Business Journal, he wrote for Bay City News Service in San Francisco. He has a degree from Walla Walla University. Reach him at jquackenbush@busjrnl.com or 707-521-4256.

2 years later: COVID’s impact on the North Bay economy

Sonoma and Solano counties: Different COVID approaches but similar outcomes

Sonoma has been among the California counties with the most proactive public health measures in the past two years, while Solano County has resisted measures.

How has each industry been faring?

Beyond the human toll, the pandemic, public policy responses to it and consumer reactions have had impacts on employers that vary by industry. We talked to players in several sectors, and here’s what they told us.

Voices of local business

Here are the personal stories of how North Bay leaders have steered their organizations through the past two years. What has changed? What were their worst fears, and how did they face them?

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