Coronavirus: Small Okanagan wine producers worried about future

Concerns grow over the toll the pandemic will have on small Okanagan wineries, some of which may not survive the current climate

As grape growing season gets underway in the Okanagan, small wine producers are becoming increasingly concerned about the upcoming season and their bottom lines.

“Very worried about our survival,”Jayne Graydon told Global News.

Graydon and her husband Paul have owned Saxon Estate Winery in Summerland for more than eight years.

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The family winery is a small operation, which produces about 2,000 cases of wine per year.

Sales, though, have all but dried up due to the pandemic.

“It’s quite severe,” Paul Graydon said. “We are a cash-flow winery, so we rely on sales to make our business.

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“So with a 90 per cent reduction in sales, it really does impact us hugely.”

The huge drop in sales is attributed to the closure of Saxon’s tasting room and a big plunge in online sales.

But liquor stores, which normally purchase Saxon’s wines regularly, aren’t doing so because the stock they currently have isn’t moving as fast, as financially strapped consumers look for cheaper alternatives.

“The liquor stores are selling less expensive wines,” Jayne Graydon said. “The liquor stores are definitely not selling the premium wines that we are currently making.”

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With no cash flow, the Graydons are also worried about how they will afford to bottle last year’s vintage.

There are a number of tanks filled with wine that needs to be bottled at a cost of roughly $12,000.

“We have four wines to bottle right now at the end of this month. Normally we would be going full steam ahead,” Paul Graydon said.

“At the moment, that is on a full stop. We just have to work out what to bottle, when to bottle, what we can afford to bottle. Cash flow is key and that is what’s dried up.”

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Ron Kubek also owns a small winery in Summerland.

He said business at Lightning Rock is down significantly and he, too, is feeling the huge impact.

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How the COVID-19 pandemic is affecting wine producers around the world

But Kubek is also the president of the Summerland Chamber of Commerce, and he’s deeply concerned about the toll this will all have on small business, including smaller wine producers.

“The 300-plus wineries in the Okanagan, a third of them I believe, because of the slowness of the government help, are going to have a really, really hard time surviving until the end of summer,” he told Global News.

Part of the problem is that smaller producers have little to no chance of competing against mass producers.

“It’s a fine line in terms of what we can do you know,” Kubek said.

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“We can’t compete against the Australian, New Zealand, American wineries that are producing wine for $2 or $3 a bottle and then selling it for $10 or $11. I mean, some of our bottle costs are $8 or $9.”

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Gurvinder Bhatia’s fine wine picks: Sunday March 8

He said the chamber will be working on a plan to help businesses not only survive the current climate, but thrive afterwards.

When it comes to the wine industry, Kubek hopes some relief will come in the way of easing up on some of the restrictions put in place by public health officials to allow smaller wineries to carry on with things like wine tastings.

“If we get two or three people coming in to do a tasting, we can clean, we can make sure that we are safe,” he said.

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At the Saxon winery, the owners are desperately hoping government funds will come through to help them stay afloat.

In the meantime, they’re asking wine lovers for help.

“I’m reaching out to the population to say please support your local wineries with electronic-order commerce and with wine club memberships,’ Paul Graydon said. “Let them deliver to your door, that is the only way right now.”

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