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After A Spate Of Deals, Vintner Group Consolidates 12-State Wholesale Footprint

July 18, 2013

Virginia-based fine wine wholesaler and importer The Vintner Group has been aggressively expanding its territory, completing five acquisitions of East Coast distributors in the past 12 months. Among key recent plays, The Vintner Group entered Georgia earlier this year through separate acquisitions of two companies which it then combined—Prestige Wine Wholesale and Quality Wine & Spirits. Then, on June 30, it closed its purchase of tri-state-area wholesaler Martin Scott Wines, gaining entry into New York, New Jersey and Connecticut and adding another vital piece to an East Coast footprint that already included Maryland, Delaware, Virginia, Washington D.C., West Virginia, North Carolina, South Carolina and Florida. In addition to its wholesale business, The Vintner Group imports a host of upscale wine brands including Chateau St. Cosme, Segla, O. Fournier and Neudorf, while also marketing a craft spirits portfolio that includes Boyd & Blair vodka, Corsair Distillery and Breuckelen Distilling among others. SND senior editor Daniel Marsteller recently caught up with Vintner Group CEO David Townsend to discuss what’s next on the agenda.

SND: After all this acquisition activity, what’s your largest market on the wholesale side?

Townsend: New York will now be our biggest, followed by Florida, Georgia and Virginia. The Martin Scott deal means we’re now in two of the three largest U.S. markets for imported wine—New York and Florida. Our wholesale operation is by far our largest business, compared with the import side, which is also growing quickly. Our average (wine) bottle price is close to $20 at retail.

SND: Are more deals on the horizon?

Townsend: You never say never, but right now we’d like to digest what we have. Growth must have an objective. Ours is to be the number-one fine wine wholesaler in every market we serve. We need to integrate the new acquisitions and make sure there’s a shared culture, and that we’re bringing synergies to each of those businesses. We’ll continue to expand and grow long-term, seeking out partners who are fine wine-focused with a knowledge-based selling approach and a high level of customer service. Those are the cornerstones we build on.

SND: How is the climate for fine wines across your markets?

Townsend: The market is very strong. We’re seeing double-digit growth as a company on an organic basis. Price points continue to move up. The really exciting growth right now is at $15 and above. There’s a lot of interest in new wine producing areas—especially among Millennials—and a lot of activity in the on-premise with new restaurants opening and growth in the existing account base. By region, we still see plenty of strength in France, and Argentina continues to grow. Spain has also been extremely strong for us. Looking ahead I think you’ll see new up-and-coming areas on the fine wine side. Chile’s having a bit of a resurgence at the high end, and we’re starting to see some interest return in upscale Australian wines. The consumer is developing a more global view of wine, and they’re moving back upmarket.

SND: Is momentum continuing in craft spirits?

Townsend: Yes. It’s definitely our fastest-growing area. We distribute our import brands and our American Still Life Collection of craft spirits in the wholesale markets we’re in but also nationally through other wholesalers. The majority of sales are on-premise, which is exciting from a brand-building standpoint. Rye continues to be a very hot category for us. Aged rum is also doing very well. There’s still more demand than there is product in each of those.

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