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Terlato Sees Wine Consumers Trading Up In The On-Premise

July 9, 2021

With the U.S. on-premise enjoying a rebound this year after the shutdown of 2020, Illinois-based importer and marketer Terlato Wines says consumers appear increasingly eager to trade up within the higher echelons of the wine category.

“As restaurants have opened back up, we definitely see that trading up is taking place,” says company president and CEO Bill Terlato. “During the pandemic people realized that with the disposable income they had from not going out, they could buy a little bit better. And it’s very hard to trade back down once you’ve expanded to a new horizon.” That dynamic has benefited upscale Terlato brands like Italy’s Gaja, for example. Overall, Terlato is projecting volume of just under 2 million cases across its portfolio this year.

With on-premise momentum rolling, Terlato is looking to accentuate its premium stable with a number of new offerings, including Lanson Champagne, which recently joined the portfolio. “They’re one of the two or three largest producers in Champagne, so the opportunity to grow is tremendous,” says Terlato. “It’s the No.-2 brand in the U.K. In the U.S. it hasn’t achieved that level of distribution and success. But our partnership will provide the framework to do that.” Earlier this year, Terlato inked an expanded distribution alignment with Southern Glazer’s, adding key states like New York and Texas to the partnership.

Another brand with on-premise opportunity moving forward is Iconoclast, a California label Terlato originally created for The Four Seasons that is now expanding market-wide in the on-trade. On the new product front, Terlato is gearing up to launch a new Provence rosé, Sarrins, as well as a new entry from Kim and Erica Crawford’s Loveblock, Sauvignon Blanc Tee, an organic wine that substitutes green tea powder for sulfites.

The company is also bolstering its spirits stable with new brands including Geometric Gin, Dublin Ink Irish whiskey, and non-alcoholic Symmetry Tonic Essences, all of which are 50/50 partnerships with former Distell executive Steven Nathan.

Amid all the additions, one familiar name within the Terlato portfolio will not be part of the mix looking ahead. The Rhone’s M. Chapoutier will be departing this year after a long partnership, owing to disagreements about forward-looking strategy in the U.S.—Daniel Marsteller

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