A to Z Wineworks
A to Z Wineworks is a partnership of two winemaking families. William Hatcher developed and managed Domaine Drouhin Oregon from its conception in 1987 until the Spring of 2001. His wife Debra was active in the venture as well. Many years ago, she also worked with David Lett at The Eyrie Vineyards.
Sam Tannahill was the winemaker at Archery Summit from 1995 until Spring 2002. Before that he worked at Domaine l’Arlot in Nuits St. Georges. Sam’s wife, Cheryl Francis was Chehalem’s winemaker from 1996 through 2003 after stints in Burgundy and New Zealand. Camas Goble joined the company in May, 2004 and, in light of her accomplishments, became a minority partner in 2005.
More About A to Z Wineworks
The partnership blends unique skills. Bill brings an extensive background in strategy and finance to the company while Deb has successfully spearheaded their design, marketing and promotion. Sam and Cheryl have combined surpassing creativity and technical experience, allowing A to Z to maintain the same quality at 40,000 cases as with the first release of 2,500 that earned A to Z Food & Wine Magazine’s award for the best American Pinot Noir under $20. Meanwhile Camas’ organizational skills have made day-to-day operations smooth, allowing the other partners to focus on their areas of expertise.
Founded a decade ago, the company has quickly became Oregon’s fastest growing winery. The business model is simple: to produce and market Oregon’s best wine values by eliminating unproductive fixed investment and unnecessary overhead.
Originally, A to Z sourced and blended excess wines from other Oregon producers. Although the company continues to purchase wine, they have gradually decreased their dependence on the variability of those supplies in favor of long-term grape agreements from Hood River through the Willamette Valley and south to Medford. While the contracts themselves ensure continuous sources of fruit, the 350 mile geographic dispersion serves as a hedge against a weather calamity in any particular region.
The idea behind A to Z is that these
four friends can seek out individual lots of good quality finished
wines, blend them skillfully to meld their individual characters, and
then offer consumers a new wine at a value price that is—in essence—greater
than the sum of its parts.
It All Comes Out In The Blend for A to Z Wineworks!
by Cole Danehower
"We will always have a really good wine and it will always be at a great value!" declares Deb Hatcher, one of four partners (and friends) in A to Z Wineworks - an innovative venture that adds a new wrinkle to the Oregon wine scene.
Instead of following the traditional route to Oregon wine success - planting vineyards, making wine - Bill and Deb Hatcher and Sam and Cheryl Tannahill have taken a radically different approach: these four industry veterans have become some of Oregon's first négociants.
Tthe A to Z brand is experiencing rapid success, and the partners are literally scrambling to keep up. Food & Wine Magazine named A to Z the best American Pinot noir under $20, and Bill Hatcher says their sales estimates are "way more than we projected."
So what makes A to Z so special?
A to Z was born out of the fortuitous confluence of two ideas.
On the one hand, says Bill "...it stemmed from a belief that you can do more with blending wines then you can working with a single-source entity." And on the other hand, as Sam explains it "with all the grapes coming on in Oregon, wineries have to worry about what to do with all the wine that doesn't make it into their top-level brands - there is excess inventory of good wine."
The idea behind A to Z is that these four friends can seek out individual lots of good quality finished wines, blend them skillfully to meld their individual characters, and then offer consumers a new wine at a value price that is - in essence - greater than the sum of its parts.
"We're offering a delicious low-priced product that will help everybody," says Deb. "The wineries are going to win because they can sell us what doesn't make their cut so they can focus on their brand quality; the consumer is going to win because we can raise the quality of 'what's left over' and give them higher quality wine at a good value; Oregon wins because eventually everybody moves up the price ladder because the wine is so seductive; and we win because this is our home, this is our life, this is what we do!"
"The pendulum has really swung in Oregon toward single-vineyard wines," says Cheryl. "We're not competing with that. We're not trying to be the 'Two Buck Chuck' of Oregon Pinot either. We do want people to use A to Z as an entré to Oregon Pinot noir, and other varietals as well. What we're trying to do is get everybody to know that Oregon wine is great!"
The Power of the Blend
The quality of the blend is all important to the success of A to Z Wineworks, so finding the right qualities in component wines is critical.
Most Oregon Pinot noir producers focus on making either single-vineyard designated wines or top-flight reserve blends that meet a certain stylistic form, both of which usually command premium prices. But in order to sustain the quality of their brands, wineries have to adhere to very strict standards in the character of the different wine lots that go into their bottles.
Sometimes, some lots don't measure up. Perhaps one lot has weaker color, another more grainy tannins; perhaps one has heavier black fruit, another may overemphasize strawberry notes. From the "home" winemaker's point of view, lots like these have weaknesses that make them unsuitable for their label, even though the wine is otherwise perfectly good - it just doesn't meet the profile they're trying to achieve.
Enter A to Z. From the négociant's point of view, each of these lots represents a potential value-added component of the blend they will create and bring to market.
"What we try to do is start with a large block that's representative of the quality we want and of the vintage," explains Bill. "Then we start working in a kind of inverted pyramid to add lots that elevate the whole."
This can be a difficult and exacting process - there is no formula for doing it right.
"We once tasted all the lots from one winery," recalls Deb, "and it was clear that one lot was the best, so intuitively you'd think putting that lot in the mix was the right thing to do. But when we did our sample blends, it was another lot that worked best when added to our base wine."
Luckily, A to Z can rely on the combined experience of the partners to parse the character of the wines available to buy. Sam Tannahill has experience in Burgundy and was winemaker at Archery Summit; Cheryl Francis was co-winemaker at Chehalem; Bill Hatcher spent 30+ years as managing director of Domaine Drouhin Oregon; Deb Hatcher has been involved in the Oregon wine world for 28 years. Together, these veterans create the blends for A to Z.
Refining those blends with needed components is a constant process right up until bottling, as Bill explains. "Cheryl might say 'we need a little more sweetness,' or Sam might want a bit more tannic structure - so we go out and look around to see who is making that kind of wine and see if we can buy some to add to our blend."
And even though the process of achieving the best blend may sometimes seem casual - some sample blending is literally done at the kitchen sink - the reality is that tasting and testing is rigorous and meticulous.
Quality and Consistency Are Critical
Once the taste and texture - the organoleptic character - of the blend is determined, "running the numbers" to determine each lot's composition is vital. "These lots are made in all different places in all different conditions by all different people," says Deb. "Even though they are finished wines, they are finished with different yeasts and different balances; the potential for disaster is huge."
"We have to make sure the wines are stable," agrees Cheryl, "and that together they will make a stable product. We don't want customers saying five years from now 'I didn't remember A to Z made sparkling wine!'"
And they don't want customers to experience variations in bottle quality. "The taste of A to Z from the first pallet shipped will not be different from the taste of the last pallet," says Cheryl.
To help maintain their quality and consistency, they do not continue to add new lots to a previous base just because new lots become available. When they are out of a vintage of A to Z Pinot gris, for instance, they will not go back and blend some more just so they can release more A to Z bottles.
"People say to us 'If you're going to run out of Pinot gris, why don't you go out and source some more?' The answer is: 'Because we've made our Pinot gris for this vintage!'" explains Bill.
Flexibility and Opportunity Are Bywords
Supporting Oregon is a vital part of the A to Z strategy. "The whole concept," explains Deb, "is to say to consumers 'let's taste what Oregon is like, let's see what the vintage was like - give me another glass!' If people get accustomed to that, then maybe they'll start thinking of Oregon as 'value' instead of 'expensive' and 'elite.'"
Yet one of the most intriguing aspects of the A to Z enterprise is the extreme flexibility the partners have in pursuing interesting opportunities. Indeed, part of the wisdom of the name is that it allows them to put together wines of all kinds - from A to Z.
"We started out realizing that we had the flexibility to make wine from the entire spectrum of each vintage in Oregon," explains Bill, "but really, with a name like A to Z, we can be open to any varietal or even any source anywhere in the world."
"A to Z has the potential to do some neat things," agrees Sam. "If, for example, we find the possibility of getting 100 cases of sparkling wine from New Zealand that taste really great, we have the flexibility to buy them and release it as an A to Z wine."
Because of this openness to opportunity, the A to Z partners are careful that their business grows horizontally rather than vertically. This is a different approach in a wine market accustomed to tiered layers of differently-priced premium wines from a the same producer.
"It makes no sense to our brand to offer a 'reserve' bottling of any A to Z wine," says Bill, "remember, one of our goals is simplicity." Cheryl agrees: "if things get complicated, we want it to be through adding new varietals or new regions, not new levels of prices."
It does make perfect business sense for A to Z to offer a wine that was sourced from, say, Washington - or even outside of the U.S. - as long as the wine achieves the brand goal of maximum value - which for the partners means high quality at a value price.
Maintaining the Brand Promise
The partners are adamant that the A to Z brand must always stand for value.
"What we want A to Z to be known for," says Deb, "isn't Sam, Cheryl, Bill, and Deb, or conceivably not even just Oregon. We want it to be known for offering the best price to quality ratio."
"The name is simple," says Bill, "and we want to make it simple for the consumer: you get a bottle of A to Z and it will be as good a wine, at as good a price, as you are going to find!"
Duo Winemakers Have Duo Wineries
Cheryl Francis is best known today for her work with Harry Peterson-Nedry in helping build Chehalem into one of the most respected wineries in the Pacific Northwest. Sam Tannahill is best known today for his work with Gary Andrus in helping build Archery Summit into one of the most respected wineries in the Pacific Northwest. Imagine what the potential is for this formidable husband and wife winemaking team as they launch their own personal label, Francis Tannahill!
In addition to their involvement with A to Z, Sam and Cheryl make their own wine. As a couple, Cheryl and Sam want Francis Tannahill to reflect their deeply-held values, and it is their personal philosophies that will drive the character of the brand.
"All of our fruit sources arefarmed organically," says Sam. "That's really important to us."
They currently source their fruit from a variety of vineyards in both southern and northern Oregon, as well as Washington. "Not all of the vineyards are yet fully organic," Sam concedes, "but we're going to try and make it a requirement as we go forward."
Living what they preach, Sam and Cheryl's own 5.5 acre estate vineyard (called "Pearl") is being farmed biodynamically. The property, though too small to achieve full sustainability, is managed as close to the earth as possible - including the young grape vines.
"We have chickens and ducks and walnuts and olives and apples and cherries and figs - we make our own compost, the beef we eat is from our cows." And the vines, Sam points out, will be allowed to mature at their own pace, with the first harvest not being until the fourth leaf - at least a year later than is common for a new vineyard.
"We also want to offer the consumer high quality and good value," continues Sam. On the quality side of the equation, he describes the vision as focusing on "super-high end, very high quality, all gravity flow, no expense spared" wines.
And yet, on the value side, Sam and Cheryl are very sensitive to pricing. "We're not pricing our wines according to quality or scarcity . . . we're pricing our wines so that our growers and the people who work for us - and us - can have a sustainable wage and maintain a reasonable lifestyle that is fairly humble but comfortable." Of course, he adds, they're in business to make a profit, "but not gobs and gobs of money."
And, Sam and Cheryl are in business to do what they love. And since they love to drink Syrah, Gewrztraminer, and of course Pinot noir, these are the varietals they will concentrate on . . . at least at first! Unfortunately for consumers, quantities will be small.
"Wine in essence is an agricultural product," says Sam. "Wine is a humble thing, its a thing of nature. When you take it out of that context and put it up as a museum piece or a luxury, for me it loses some of its reason for being. Wine is meant to be enjoyed by people, it's not meant to sit in a cellar and impress people."
With two such skilled winemakers making such personal wines, one cannot help but wonder at the mechanics of decision-making, especially amid the pressures of harvest. When asked "Who is the winemaker?" they answer, in unison: "We are!"
Bill Hatcher Has More Than One Wineworks!
Bill Hatcher jokes that people who know him won't believe a photograph that shows him actually working. But when you meet up with Bill these days, he is most likely hard at work making his own wine for Hatcher Wineworks, or sampling wine lots for A to Z Wineworks . . . or driving from one place to another to help keep both enterprises profitably driving forward.
For a man with a passion for poetry, a penchant for philosophy, and a preference for profit, the process of making his own wine under his own name has proven to be both an intellectual and creative challenge.
"When I write poetry I am dealing with the abstract and there is no timeline," he says. "I can work on two lines for two weeks getting them into the right context and saying exactly the right thing. But given the organic nature of wine, I am now dealing with the concrete, and decisions have to be made on the wine's timeline, not mine. After making a decision I might later wish I had done something different, but I can't go back and do it again - there is no eraser on the end of the pencil!"
The parallels between making wine for the Thanksgiving Weekend debut of his Hatcher Wineworks, and writing poetry for himself are striking. Just as a poet needs to understand the rules of different meter forms before he can decide when to break them for creative innovation, so Bill has observed that he must understand the technical aspects of winemaking before he decides to do something different to achieve the creative expression he's after.
"There is something you're reaching for, something that you want to express in the fruit," comments Bill. "To do that without constraint, you must compromise something else. But then if you want to play it completely safe, you'll probably get a wine that isn't very scintillating. The creative challenge is frustratimg . . . and fascinating."
Juggling the increasing demands of a growing A to Z Wineworks, with the demands of a growing Hatcher Wineworks, is also a challenge for Bill. "It is difficult," he admits. "A to Z is big enough that I can't just put it aside to make my wine, yet making my wine has its own demands."
"I really believe that with few exceptions, you are able to get a more complex wine by blending. There are very few wines - like Chambertin - that are gestalts within themselves. It's like in cooking, you can always use salt and pepper, but why would you limit yourself to just that?"
Being rigorous in the quality that goes into his blend is vital, Bill believes, if he is going to achieve his goal of a balanced Pinot - that, plus the personal creative inspiration that takes Bill from poetic verse to vinous poetry!
Dear readers- The article below, first published here in 2002, is a little old, but fascinating. Here is the interview where Bill Hatcher laid out his view of the Oregon wine industry, and in it, you see the seeds that will develop into A to Z Wineworks. Bill has an excellent grasp of the wine industry, and this interview continues to offer valuable insights. - 4/04
Vinous Veteran Bill Hatcher
by Cole Danehower
Managing Director of Domaine Drouhin Oregon for the past 13 years, Bill Hatcher has seen from the inside how the state's wine industry has grown-up. Now, as he moves on to new opportunities, Bill shares his unique-or as he says, heretical-opinions on wine as art, craft, business, and passion.
Domaine Drouhin and Bill Hatcher
The story has been told many times about how the French came to Oregon, and how their presence helped bring global credibility to Oregon's winemaking status. But merely being here did not ensure a lasting impact. For that, Domaine Drouhin had to accomplish two others things consistently well: make great wines, and manage an Oregon wine business.
The two things went hand-in-hand. Domaine Drouhin Oregon (DDO in the local parlance) established an enviable reputation as a highly visible and involved member of Oregon's wine community, and the quality of their wines continuously added to the reputations of both Maison Joseph Drouhin and Oregon.
Key to DDO's success was Robert Drouhin's early decision to hire Bill Hatcher as the business's Managing Director. A poet as well as a businessman, Bill brought to DDO both the artistic sensibility that respected the craft of winemaking, and the day-to-day pragmatism of running a business. Now, after a long and successful tenure, Bill has decided to leave DDO. Recently, he sat down with the Oregon Wine Report to talk about what he's learned.
This has been a great experience for me," says Bill Hatcher as he leans back in his chair and with a swooping gesture toward the window, takes in a swath of Domaine Drouhin vines. "I've spent thirteen years in this magnificent setting . . . I've learned so much . . . I've worked with such wonderful people and made enduring friendships. . . many warm memories reside . . ."
He stops speaking for a moment, and then continues. "But there comes a time for everyone in any situation to move on."
And Bill has moved on. This April was his last month at DDO; at press time he was not yet in a position to discuss what he was moving on to. But, he said with a smile, "I'm looking forward to being able to take my own stupid ideas and see if they work!"
Branded a Heretic
"Stupid" is not an adjective that leaps to mind (no matter how facetiously used) when listening to Bill present his views of the state of the wine industry.
"Heretical," by his own admission, is nearer the mark. "I have deeply held beliefs about this business," he says, "that sometimes are thought of as sacrilegious because they challenge the mythology."
Bill states his "heresy" in its simplest form: "Wine is becoming a branded business. The world of entitlement has passed. The rules that applied twenty years ago, and the niceties of the business are being aggressively challenged."
For Bill Hatcher, the world of wine-and the Oregon wine industry in particular-is at a critical juncture. "The challenge today for Western European producers, and for Oregon as well, is to recognize the importance of brand, marketing, and competition in what has become a global wine business."
He explains further: "Twenty years ago winemaking was still an art form. It was passed down almost ritualistically within families. But today that knowledge has been codified and disseminated to allow someone now to go out and hire a winemaker, not unlike one can a software engineer. This may sound blasphemous to the artistic sensibilities of winemaking, but in their own right, those who design software would equally consider themselves craftsmen, if not artists."
What this has resulted in, Bill believes, is that quality wine is now simply the price of admission to compete.
"Because there is wide understanding of successful viticultural methods and winemaking technology, it is now possible to cope enologically and viticulturally with more difficult conditions-whether warm, cold, dry, or wet-in global regions thought heretofore to be marginal for wine production," he says.
"In short, there is no longer an excuse not to produce good wine."
This dispersion of wine expertise is forcing dramatic changes in how the wine business is managed, says Bill. Most notably, increasingly large companies are competing in a global marketplace with a wider range of wines. Given the leveled playing field of quality, winning in the market, for these global companies, is a matter of marketing. And as product quality becomes less differentiated, the differentiation of value to the customer-real or perceived-becomes more dependant upon brand identity.
"For Western Europe, and regions like Oregon," says Bill, "the challenge is not to abdicate one's patrimony and aesthetic, but rather to translate these attributes into perceivable value to the customer." In other words, help the customer understand the value in the wine they are buying.
To illustrate his point, Bill cites how the market perception of Australian wines has changed over the years. "Fifteen years ago Australia was thought of as capable of only producing a $6 Lindeman's Chardonnay. Now you see Penfolds rated a 95 by the Wine Spectator and selling for $120 a bottle."
A New Competitive Wine World
"So, how do you compete against a region, or even companies within a region, with millions or even hundreds of millions of dollars to spend to condition market perceptions-and the ability to deliver the real wines that back up their marketing claims?"
Too often, Bill claims, the approach is to deny that the rules have changed. "Some wineries believe that as long as they continue to make fine wine, it will sell itself."
That has only been true in the past, says Bill, because competition was sparse. And it may continue to work for awhile as old reputations cling. But it won't work in the long run, thinks Bill, because producers who don't "communicate their values in the marketplace" will be squeezed out by larger or more nimble competitors.
"Nothing drives me crazier," says Bill, "than to hear a winemaker complain that 'they just don't understand my wine'. The simple reality is that few people are willing to invest themselves in appreciating what the market-right or wrong-defines as idiosyncrasy. It's wine, not James Joyce," he concludes.
From the consumer's point of view, Bill says by way of illustration, it is difficult to decide how to risk their money on an unfamiliar wine. "A consumer looking at a row of Chardonnays in the $15 to $30 range has no idea how to choose-except that they know they liked that Jacob's Creek over there, so that's what he or she ends up buying."
In buying the wine they know, says Bill, they may have passed up a more finely crafted wine that cost more, and which might also deliver more flavor and experience. But this hypothetical consumer may never know that because the power of, say, the Jacob's Creek brand was too effective, and the risk/reward ratio of the unknown wine is just too high.
"I believe that in the long run, unless they adapt, it will become more and more difficult for smaller regions like Oregon-and even Burgundy and non-mainstream parts of California-to compete because branded products are going to grow. Economics is the perfected form of Darwinism."
If he is right, then what hope does Bill see for the craft producer of fine wines-which includes mostof Oregon's wineries?
"Don't misunderstand," protests Bill, "I don't believe our best wineries have to compromise their craft to compete. The underlying qualities that create grace, nuance, and finesse are what makes wine so wonderful. In fact, these are the very things that we have to become better at marketing in order to thrive, if not survive, in this new world of mass branded, increasingly homogenized wines."
"The partisan response," he continues, "would declare it unthinkable that 'me-too' refinery offerings could ever displace finely shaded wines on the consumer's palate. Then again, forty years ago no one would have predicted the demise of roadside diners with their myriad regional nuances at the hands of monolithic fast food chains."
"Unfortunately," Bill laments, "a lot of wineries would still prefer to believe that all you have to do is plant your vines and make a few basic commercial decisions in order to have a successful wine business."
Summing up the new business challenge Bill believes faces wineries, he asks this question: "When you can walk into Trader Joe's and buy a $4 bottle of Chilean Merlot that is absolutely drinkable, how do you make the argument to a consumer to spend $20 or $30?"
Market the Uniqueness for Success
The answer, Bill believes, is for quality producers to embrace brand marketing in the same way that the big commodity wine producers are doing-but to focus their messages to consumers on what is special about their wines: brand the nuance that makes them unique.
"Wine professionals can talk about how the subtleties of a $75 bottle of wine make it better than a $20 bottle, but to a consumer, those differences are often marginal," says Bill. "They don't necessarily translate into value to the consumer."
So, he says, the craft winemakers must develop a strong marketing appeal. An appeal that is commensurate and reflective of the wines they produce, in order to induce consumers to buy their offerings rather than the heavily branded produce of the global wineries. "Better winemakers," he claims, "will sell a certain amount of wine just on the pull of their name, but at some point inertia is insufficient to keep the product in orbit."
The trick is to persuade the next consumer to the marginal values that differentiate the craft producer's wine in quality and cost. What gets confused in Oregon, Bill thinks, is that "what passes for marketing is merely advertising." And advertising alone, says Bill, does not constitute a marketing plan. "You can buy the finest steelhead gear, but if you fish in the park frog pond, you won't catch anything."
"What Oregon does have, is an image from afar that it is one of the last pristine places." This, combined with its reputation for wineries that are small family businesses focusing on quality artisan wines, provides, in Bill's view, a unique platform for differentiated marketing.
"I'm not denying the importance of the art and craft of winemaking," cautions Bill. "It is the sine qua non. However, I steadfastly believe that you have to find a balance between preserving the art form and making it commercially viable."
Preserving the Art; Marketing the Value
Bill sums up his marketing vision this way: "It is to preserve the art in winemaking while at the same time communicating its value as perceived worth to the consumer. For example, most bottled water is purchased for intangible reasons, convenience, image, etc., whereas twenty years ago the idea of a two dollar bottle of water in a gas station convenience store was ludicrous. Similarly, who would have thought twenty years ago that you could sell a cup of coffee for three bucks, let alone create a worldwide chain of stores to do so?"
Bill believes that craft winemakers-in Oregon and throughout the specialty wine regions of the world-must bring new sophistication, resources, belief, and will to their business and craft. "Not to be submerged by these market forces," he points out, "but rather to ride the crest of the wave."
"Our thinking must become more sophisticated about how to market our products," Bill explains. "We must cultivate the resources and the mindset to think in terms of the marketplace. That means knowing who our customers are, or could be, and why they (would) buy our wines. How much is attributable to the intrinsic qualities of the wine itself, how much to the image the winery projects, how much to the public personality of the winemaker and so on. It also entails an understanding of market trends with their associate risks and opportunities. And, it involves strategic partnerships such as those fostered by special bottlings, preferred customer premiums or key retailer/restaurant alliances that project the brand."
The risk, as Bill sees it, is that if such principles aren't applied, "then we allow the wine business to become a commodity business, and treasures like Burgundy and Oregon risk being compromised into something that will become that much more 'white bread.'"
"If," he continues, "in twenty years people have forgotten the wonderful nuances of these wines, we will all find ourselves drinking pretty much the same McWine, differentiated only by extra oak or extract, like double cheese. Nuance will be a mere redolence, like the memory of the best piece of apple pie in the world at that little café in Bakersfield."
Concluding his convictions, Bill cautions "I'm not claiming to be an oracle; I'm simply defining a problem that's wholly apparent. I'm not saying 'here is the way we need to market this industry;' rather, I'm saying, 'we need to identify what makes us different-both as a region and as individual producers-and craft that message just as we craft our wines'. The answer is neither singular nor is it static; we need to continually remind an increasingly distracted marketplace of ourvalue."
And lest anyone think that Bill is giving up on wine in his life after DDO, he has a heretic's final thought: "You'll probably have to burn me at the stake to get rid of me."