Do you ever wonder, “Why do imports seem to cost less than domestic wines?”

Here are some thoughts…

Do you ever wonder, “Why do imports seem to cost less than domestic wines?”

Each day I analyze who’s clicking onto my blog, from aggregated sources. I found my story, the one about Marlene Rossman, an extraordinary wine writing talent, coming through to be from BabyBoomerKnowledgeCenter.com.

I re-read the story and noticed a comment at the bottom of it. Given the nature of the question, it was unlikely that the publisher of the site was going to be able to answer it. There was a total disconnect to the site’s genre ability. … Honestly, at the time, had I not been in the wine business for over 16 years, I wouldn’t have been able to answer it, either. (No harm, no foul.)

For me, it actually took working with Delfim Costa of Enoforum Wines, based in Évora, Portugal to even begin to have an answer to the question.

QUESTION from Terry:

Visiting France a few years ago, I was pleasantly surprised to see wine priced very reasonably. For $5-$10 you could buy quality which would cost you double that in the U.S. Some say wine here, both imported and domestic, is overpriced in general, at least compared to Europe. Is that true?

ANSWER from Jo:

…It’s not that wine is over-priced in the US. I wrote a blog on the cost of a bottle of wine. The Cost of a $50 Bottle of Wine

The breakdown is staggering for the fees associated with producing a bottle of wine. It’s priced fairly in the US (mostly), given the stream of people who must be paid within that system.

What causes imports to be less expensive is that the cost of living for land, supplies, and labor in other countries is less; consequently, it costs less to make that bottle of wine.

The next consideration is the costs involved in importing the wine… the licenses, the taxes, the transportation, the storage of it, and now the sales and marketing to support in the US… But it still remains less by comparison. (It costs more to live here than most places where wine is produced in the world, right?)

You can always travel the world to get your less (cost of living) expensive wine, but now you have all the expenses of going abroad. It’s cheaper, in the long run, to let the pros bring it into our country, but it’s definitely more fun to go get it yourself.

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2 Responses to “Do you ever wonder, “Why do imports seem to cost less than domestic wines?””

  1. Bill Haydon says:

    The cost of labor is a complete myth that the California wine industry likes to spin to justify their ridiculous prices. The reality is that, outside of South Africa and maybe South America, winery vineyard and winery employees are not low-wage third world workers. When one considers, the EU countries, I would argue that workers are paid considerably better than in California, get better benefits and far more paid time off than do the Hispanic migrant labor that the California industry relies on to such a large degree, yet one can find small, estate grown wines from virtually every major region in Italy, Spain, France and Germany that shame California’s ability to do something of even remotely similar quality at the same price.

    Also, consider that those European wines have to be shipped across the Atlantic, pay a Customs duty (along with all the same federal and state excise taxes that domestic wines pay) and often have four tiers (producer, importer, wholesaler and retail) instead of three before reaching the consumer.

    The real root cause for why California can’t or won’t produce artisanal, boutique wines at the same price points as the Europeans has a lot more to do with arrogance, pretentiousness and greed than any illusory production and labor costs.

  2. Jo Diaz says:

    Thanks, Bill, for your assessment.

    Vineyard workers are just one layer, as you know. Let me give you a recent scenario, for one of our clients… We wanted a single, one-page Website for a client, as a landing page. We were quote $35,000. Let’s talk about marketing. What you might lose on one end, you get stuck with on another.

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