Michael Mondavi Family Estate Sees Robust Growth For 2013March 18, 2013
Michael Mondavi’s comeback in California wine is gaining momentum with the announcement that the veteran executive’s firm is planning sharply higher sales volumes this year, passing important mileposts in the process.
The core business, Michael Mondavi Family Estate, which encompasses such labels as Emblem, Oberon and Spellbound, as well as the flagship $200-a-bottle Atlas Peak Cabernet Sauvignon called M, is projected to see volumes hit 120,000 cases this year, up from 80,000 cases in 2012.
The company’s import arm, Folio Fine Wine Partners, expects to see 10% growth this year to surpass 500,000 cases for the first time, according to managing director and partner David Francke. Folio handles Italy’s Marchesi de’ Frescobaldi, Bruno Giacosa and Tenuta dell’Ornellaia, as well as Palacios Remondo and Artadi from Spain, among various other labels.
Mondavi’s joint venture with the Hyatt hotel chain, under the brand Canvas Wines, also is topping expectations. “When we started with Hyatt in 2007, the initial plan was that would we do 30,000 cases a year,” Francke says. “Now we expect to exceed 100,000 cases this year. The program has turned out to be more popular than anybody expected.”
The 70-year-old Mondavi left Robert Mondavi Winery in 2004, and the company was sold to Constellation Brands later that year. He then went out on his own, acquiring Carneros Creek Winery with his two children, Rob Mondavi Jr. and Dina. But Mondavi said he has no grand ambitions for expansion.
“Growth for the sake of growth is evil,” Mondavi said. “But growth for the sake of an enhanced strategic direction—where we can get big enough to be meaningful to key retail accounts—is a healthy thing. At the same time, we want to stay small enough that we can all still have a life, too.”
Mondavi added that he has no intention of repeating another mistake he believes he made at Robert Mondavi Winery—selling shares to the public. The disparities in harvests from one year to another inevitably clash with stockholders’ impatience, he believes. “Companies dependent on agriculture aren’t a good fit for public ownership,” he said. “As a family, we’re managing our business for the long term.”
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