The wine industry is poised to undergo a radical transformation. Faced with slipping sales and high overhead, many wineries have been forced to confront a basic truth about American wine drinkers: 80% of wine is consumed within a week of purchase, yet it’s packaged inone of the most wasteful, unnecessarily heavy materials. Glass represents 50% of theshipping weight for a bottle of wine and it’s not verylikely to be recycled–only about 15% of wine bottles actually end up being recycled. Due to a growing desire to be green, the number of boxed wines have become even more prevalent–but the stigma attached to box wine means it is still not widely accepted by wine drinkers (in 2007, I wrote about the challenge of French importer French Rabbit in making TetraPak wine for Fast Company). The new company Yellow+Blue takes their sustainability mission a step beyond responsible packaging, focusing on consumers who are passionate about the story. The company claims their choices have made them profitable during the biggest sales dip in the industry in years.
A RIPE OPPORTUNITY
Matthew Cain had been importing wine for the past 15 years, bringing small, high quality producers from France and Italy to the U.S. But about two years ago, Cain started to question the “ridiculousness” of wine packaging, including the wastefulness of shipping heavy bottles halfway around the world. He was lucky enough to work for over a decade with the legendary Kermit Lynch, who impressed upon him some solutions for keeping wine safe. “Wine is fragile,” Cain says he learned from Lynch. “It was of particular importance to me is that wine is protected.” Of course any wine that would need to be aged longer could be keptin glass, but for the wine that was drank within a week, a smartersolution could ensure that wine was produced and stored in a way that was perhaps even better than glass. The challenge became an issue of putting wine in the safest environment possible that would also be safe for the environment.
Matthew Cain (right) with winemaker at winery Fabril Alto Verde in Argentina. (Photo: David Fields)
Cain first went to work finding his grapes. He vowed to work only with vineyards that shared his values, locating four organic vineyards worldwide, including the first certified organic vineyard in Argentina, Bodega Nanni, as well as one of only two certified biodynamic wineries in South America, Fabril Alto Verde. In addition, Cain works with an organic winery outside Alicante, Spain, and he will soon begin working with De Martino, a winery in Chile that’s supersustainable: It’s the only winery certified by the Kyoto Treaty, producing more energy than it uses and managing a wastewater plant.
Spools of flattened TetraPaks before they’re filled at the U.S. packaging plant.
INSIDE THE BOX
Yellow+Blue went with a choice that is becoming increasingly popular for wine: a TetraPak with graphic design by Terry Scullin at TMinus1 Creative. Wine is not “boxed” on site, instead, to save even more money in shipping, as well as energy expenditure, the wine is shipped in insulated steel containers by boat to the U.S., where the wine is “boxed” in a domestic facility. This factor alone saves the company millions of dollars in shipping. “A case of wine in glass is 9 liters and weighs 40 pounds,” says Cain. “My wine is 12 liters and weighs 28 pounds. A case of wine in glass is 50% wine and 50% packaging. We are 93% wine and 7% packaging.”
Yellow+Blue even got the stamp of approval by Dr. Vino, the wine journalist Tyler Colman, who built a carbon footprint calculator for the wine industry. “Our carbon footprint is 54% what it would be if we did the same thing in glass,” says Cain. “If we shipped in 750ml glass it would be $18, here you get a liter at $12–and it’s the same wine. We pass the savings along, but still make a profit.”
Yellow+Blue shares the shelves with traditional labels at Bottlerocket Wine & Spirit in Manhattan.
STRATEGY FOR GROWTH
“We wanted to find a way to work with all those people in a way that brings value to them,” says Cain, so they made a tough decision when it came to distributors: Yellow+Blue didn’t sell to any national chains, and even when they sold to someplace like Whole Foods, it was on a regional basis. Instead, they focused on owner-operated shops and bars, places like the farmers’ collective restaurant Founding Farmers in D.C., Hearth and Rouge Tomate in Manhattan, and in San Francisco, Yield, a green wine bar, and the restaurant mini-chain Andronico’s. “We were building through the customers where we know they’ll embrace it,” says Cain, who personally hand-selected the distributors who made smart decisions about where to sell.
Yellow+Blue was also selective in choosing a type of bar and restaurant that would pass along the sustainability information to their customers; restaurants that had the same values for serving local and organic foods. Cain says that the servers even tell customers the story behind the wine–actually informing them that the wine comes in a box, and sometimes bringing it to the table to show to them. It goes beyond simply sustainability at this point, it’s a combination of value and provenance. “These people are saving money, and they’re making a point of showing the packaging to them and making them proud of their decision.”
Rosés from Yellow+Blue give drinkers a liter of wine for the same price as a 750ml bottle.
COMPLICATIONS AND INSPIRATION
Unfortunately, there are still many places in the U.S. that don’t recycle the TetraPak, which is regulated on a municipal level by each recycling program. But one positive aspect of TetraPak is that it has a task force of about nine people who travel the country advocating for TetraPaks to be recycled. Still, says Cain, using the TetraPak, which is 75% paper from responsibly-managed forests, was a better choice overall when compared to glass. “The first step is reduction,” he says. “if you don’t ship a bottle around the world you’ve already reduced waste, fuel cost, shipping.”
Yellow+Blue’s perspective could potentially transform the domestic wine industry, which is facing a tremendous downturn, especially the high end brands. Americans, while continuing to drink wine, are buying less expensive bottles–there’s been a severe drop in sales of bottles over $15, meaning people who used to buy $30 bottles are now buying $13 bottles. A switch to less-expensive packaging for wines that will be drank within a week could bring profit to these wineries struggling with cash flow. “Our sales will be up 250% as compared to 2008,” says Cain. “We have moved in to 45 states in the U.S. in the face of the worst industry slump in decades.”