Archive for the ‘Business’ Category

The shocking fact is that for less expensive wines, the cheapest element of the price that you pay is for the wine itself – the actual 75cl of white, pink or red liquid in your bottle! When you consider the amount of effort that goes into producing a single bottle (from growing the fruit, harvesting, converting it into wine, bottling it and packaging it), the fact that this can actually represent just a tiny fraction of what you pay is really a bit of a scandal (speaking from a wine producers point of view, of course)!

I guess that the same could be said for any number of products that you might find in your weekly shopping basket – we are after all, simple fruit farmers. The only difference being that we take the production one step further by fermenting the fruit into alcohol. And thereby lies the key word….. Alcohol! 

The moment that the bottles and pallets leave our door is when the costs start to mount up. Transport and shipping I have already mentioned, but once our wine crosses the Spanish border, it immediately become liable for the duties and taxes of the importing country. It’s only when you start to examine these additional levies a bit more closely, that you see the cost of a bottle really beginning to accelerate.

When goods eventually arrive at their destination then they can also attract further warehousing and handling costs. Depending on the type of customer, they could then attract further, onward distribution costs even before they arrive anywhere near a consumer.

Now we can finally talk profit! Of course the wine producer himself has already extracted a very modest cut, and then the importer will add a further margin before passing the bottles on to a retailer or restaurant. Of course the profits made by shops and restaurants are already well documented, and it is probably better that I don’t comment at all – suffice to say that these can be quite “healthy”.

The net result is that with all the handling, distribution, taxes and duties etc., a very modestly priced wine can end up being quite a bit more expensive. A very frightening calculation (working backwards), is that a bottle sold in the UK for around £5.00 leaves almost nothing at all for the cost of the wine itself!

Following my latest post about the cost of producing a bottle of wine, I have just read a very interesting article written by an old friend of mine – UK wine journalist Tim Atkin MW. Although he is not actually commenting directly on the production costs of wine he is, in effect, talking about the price pressures often put on producers to reduce their selling price (and certainly their profit margin). If this downward pressure is allowed to continue then, inevitably, the only thing that can and will suffer, is the quality of the liquid in the bottle.

In the final line of his article he says “More than ever, we need a strong independent sector to preserve diversity, quality and individuality.” In this case he is referring to independence in the retail sector, but allow me to say that the very same phrase could easily be applied to the wine producers themselves.

He is a link to Tim’s full article.

There used to be an advertising campaign on UK TV for bars of chocolate. The slogan was something to the effect that it took 1½ glasses of milk to make one bar of chocolate…. without actually specifying the size of the glass, or the bar of chocolate!

In the world of albariño I can tell you that it takes approximately 1½ kilos of grapes to make one 75cl bottle. Of course this seemingly simple calculation can sometimes be compounded by the price of the grape itself. Even if a bodega owns 100% of its own vineyards (which not too many do in Rias Baixas), the cost of grapes still fluctuates. Of course, yield can be controlled to a certain degree but will always vary a little, and labour cost in the vineyard can change according to the growing season, depending on how much work is required. Then there is also the cost of buying, maintaining and running tractors and other equipment that has to be factored in. On top of this, if you are then obliged to buy additional fruit on the open market, it can become a bit of a lottery. Grape contracts do exist, but some can end up being quite meaningless as market demands can often put a strain on persuading growers to honour them!

So once we have our 1½ kilos bought and paid for, safely in our tanks, then what else needs to be included in the final bottle price? Believe me, it’s a long list! Materials for making the wine, materials for bottling the wine, labour costs, and not to mention the overheads of running the bodega itself – electricity for machinery etc. Next comes the outer packaging, cartons, pallets, pallet wrapping, even before we can even consider moving the wine.

In export we are rarely involved in the cost of transport, but there will always be some element of (expensive) road haulage involved. With pallets weighing in at over 1000kg each (even using our Eco friendly lightweight bottle) the cost of moving them around, especially by road, does not come cheap. Sea container transport does work out much cheaper, but then this is usually limited to customers outside Europe, with the odd exception.

With all these elements quickly adding up the wine is finally on route, and the cheaper part of the final bottle cost has been explained. The really expensive part of the calculation I will save for another day!

More points!

May 25th, 2017

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OK, I confess that I was so excited that I missed this…. Our A2O also received 91 points from the American Wine & Spirits Magazine. I missed it because they (confusingly in my opinion) refer to both of our wines as Castro Martin. True, they are both made by Bodegas Castro Martin, but in the winery we refer to them by their individual brand names. Actually, the truth is that we refer to them as A2O and BCM.

So here are their notes: A2O Sobre Lías Albariño (Best Buy) The fruit of vines between 20 and 50 years old, this spends six months on the lees to enhance the creaminess and depth of its aromas. The texture is shaped by taut acidity, full of mineral flavors and notes of citrus that leave a fresh sensation of lime and white stones.

Posted in Business, Press, Tasting

Don’t get me wrong, it’s always a good feeling to receive a positive review, or perhaps a medal for one of our wines, but to be honest I still find myself in two minds as to their real value. On the one hand it’s great to have the endorsement of a third party taster, whereas on the other hand my own philosophy has always been to simply pull the cork and decide for yourself if you like the wine or not. Of course the reason behind my thinking is that the appreciation of wine is completely subjective – personal taste. For example, I know some wines that I think are fantastic, whereas other people that I know just don’t like them at all. I have always said that it would be very boring if we all liked the same things, no matter what the product, and that’s why the world of wine is so interesting and open to everyone. Having said all that, I do appreciate that in some markets the points do still count!

When it comes to Castro Martin wines, then it goes without saying that I am more than just a little bit biased, after all, I do help to make them. However, on the occasions that we do receive a good score (or perhaps a bit of silverware) it simply serves to reinforce our own belief that we are doing a good job. After all, it’s no good making wines that only Angela and myself appreciate. 

So the news is that this week we were awarded 92 points (and wines of the month Best Buy) by the Wine and Spirits magazine in the U.S. They said of our Castro Martin Family Estate ‘Sobre Lias’ – “From 50-year-old vines in Salnés, this wine aged for six months on its lees, developing an unusual combination of juicy pineapple flavor and stoniness. It’s nervous in acidity, tightening around the leesiness to create an intense, savage albariño. Far from the simple and creamy whites that populate Rías Baixas, this explores new territories, its full-on fruit flavors and mineral notes giving a deep and immersive complexity. You can drink it now with fried scallops, or cellar it for two to three years.”

Say no more!

Posted in Business, Press

A to ZWell, you learn something new every day as they say, but only recently did I discover that Castro Martin actually has something in common with one of the largest companies on the planet!

One of our most Frequently Asked Questions is about the logo/name of one of our brands – A2O, and to be honest I feel just a little embarrassed when I have to explain it’s origin…. but not any more. It seems that the logic behind it (if you can call it logic) is shared with one of my most frequently used websites, Amazon. Please allow me to explain.

The name A2O quite simply comes from the word AlbariñO, which starts with the letter A and ends with the letter O, in other words from A to O (and we have simply substituted the word ‘to’ with the number two, and given it an accent to add a bit of a Spanish flavour). So that’s the story – clear as mud, I’m sure you’ll agree!

OK, so what about Amazon you ask, and where’s the similarity? Well, did you ever notice the arrow in their logo that underscores the name? Do you know why it’s there? I didn’t. If you look at the placement of the arrow it actually points from the A to the Z, and yes, you may have guessed already – the implication is quite simply that AmaZon stocks everything from A to Z (or should that be A2Z?!)

I have to admit that knowing this makes me feel a whole lot better, and it goes without saying that the next time someone asks about A2O, I will also make a point of explaining our very tenuous link with Amazon.

A time for giving

November 29th, 2016

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Gift packsNo sooner have we got our International shipping orders loaded and on the road, than we start with the slightly more modest (but equally as important), gift orders for the holiday season. As you might expect much of our ‘gift’ business is in the local Galician market, as local businesses send tokens of their appreciation to customers at the end of the year.

To be very honest making three bottle gift packs (see today’s photo) can be a bit fiddly and time consuming. Over the years we have tried many different types of ‘estuches’ (as they are known in Spanish), but not based purely on how good they look or how much they cost. We also have to take into consideration how complicated, and therefore, how much time it will take to assemble each empty case. Quite frankly some of them can be like a work of origami, and subsequently have to be avoided. We always have to take into account the simple equation: Time=Money!

Posted in Bodega, Business, Fiestas

Christmas rushNow that both the harvest and wine making are pretty much behind us, the next significant event is almost upon us – the Christmas holiday season (am I still allowed to call it Christmas?). Anyway, whichever name you decide to use, the holiday season (including Thanksgiving), is always a busy time for us.

For the last week or two we have been busy preparing orders for shipment – many to Europe, but others for more distant shores. Part of our pre-harvest preparation is to fill the cellar with ‘floor stock’, labelled and ready to go, but much of this has already been sold, and so for the next few weeks our mission will be bottling more tanks of 2015 wine to replenish our depleted warehouse. (We bottle our wine throughout the year, as required, to keep the wine as fresh as possible – it keeps better in tank).

Posted in Bodega, Business, Fiestas

A life at sea

August 1st, 2016

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The WorldCastro Martin already proudly sells wine to cruise ships, including the famous Cunard ‘Queens’, and the new P&O flagship Britannia. In addition to this our wines are now sailing on board a completely unique type of ‘cruise’ ship – The World – a Residence at Sea.

To explain this format in simple terms ‘The World’, at 644ft, is the largest private residential ship on the planet, providing floating luxury accommodation for those who can afford it (and want it). Guests, or should I say residents, of this huge floating home simply spend their whole time sailing around the world, again, and again, and again! The accommodation for each resident is not so much a cabin, but is actually a self contained apartment , with pretty much all the amenities of home – except perhaps the underground parking.

As you might imagine, the ship is loaded from top to bottom with different forms of entertainment – fitness, yoga, swimming, diving, kayaks, golf (the water hazards are quite impressive), and even a full-sized tennis court. Apart from numerous bars and restaurants it also caters for a wide multitude of hobbies (including wine tasting), boasts a cinema and theatre, and also has it’s own library. I am sure that this lifestyle will appeal to some, if not many, enjoying a different view from your window every day, but I’m afraid to admit that it certainly wouldn’t work for me.

On the plus side they do stock a great albariño!

Posted in Business, Travel

Farsons wine shopNot only do our wines appear on various cruise ships around the Mediterranean, but now they are also available on dry land, in the middle of the Med on the island of Malta. Historically one of Europe’s most strategic islands, located between Sicily and the North African coast. Over the centuries it has fallen under the rule of many a different regime and/or country including the Romans, Phoenecians. Moors, Spanish, French and the British, before finally achieving independence in 1964.

Our new customer – the Farsons Group, is not only a wine import company, but also owns a large brewery, manages some very well-known food franchises, and is an important food importer and distributor on the island. We are naturally quite delighted that such an important business has decided to represent our wines.

Of course , with it’s warm Mediterranean climate Malta is the perfect place to enjoy a chilled glass of albariño this summer (or any summer for that matter)!