In the wine trade, they are sometimes called overstocks, inventory reductions, or just simply closeouts. The economics of the wine trade frequently dictate that a wine be “moved out” just as it is approaching its peak level of drinkability. Shouldn’t these wines be going up in price, not down? Why does this happen? There are many reasons; here are just a few examples.
Since fine wine is an agricultural product, it is invariably tied to the cycles of the environment. Every 12 months a new vintage pulls into the station like a freight train coming down the tracks. At the same time, the whims of seasonal weather variation lead to shortages or windfalls in the grape harvest on an annual basis. An abundant grape harvest in any given region will result in a surplus of wine; in many of these cases the vintage will not sell out before the next vintage arrives. Today’s business environment emphasizes and rewards consistency and control, something which our favorite fruit of the vine strenuously resists.
In the United States, alcoholic beverages have been classified as controlled beverages since the repeal of Prohibition. This means lots of rules and regulations (three tier distribution, franchise laws, etc) that create inefficiency and leads to the frequent loss of wines in the gears of the distribution machine.
Wine marketing is often a rather counterintuitive affair. A common practice among wine marketers is the allocation of significant percentages of production to restaurants. The theory is that a greater number of people will be able to appreciate their wine in a restaurant dining room than at the dining room tables of the American consumer. This may have been a valid theory twenty years ago, when restaurants typically practiced a restrained and reasonable 2x mark-up over cost on wine. Over the last decade, wine list mark-ups have climbed as high as 3-4x cost in some restaurants (sometimes more), which has made many wines cost prohibitive to consumers. These days, a good local restaurant with a reasonable mark-up on wine is worth its price in gold. Attempts by wine marketers to artificially manipulate the marketplace in this manner frequently leads to scenarios where perfectly good to outstanding wines become caught in a spiders web of marketing red tape.
These are just a few examples of market forces that that lead to the development of Bin Ends. It should be noted that poor quality of wine did not make our list. Does this mean that there are no poor quality wines? Of course there are. Bin Ends is simply committed to making certain that poor quality wines never cross the threshold of our loading dock door. Our promise to you, our customer, is that every bottle of wine that makes it to the floor at Bin Ends must be of very good to outstanding quality and represent a great value. What about wines of slightly lesser quality? For these wines, we have developed a program called Cooking Wine for Hunger Relief to address these orphans. Life is too short to drink bad wine.
There may be an endless supply of bin ends for us to bring to you, but that does not mean we have an endless inventory of any one product. Many of our selections will be small lots of product, meaning that “once it’s gone, it’s history”. We feel that this is one of the things that will make Bin Ends so much fun. Coming back every week or two will always provide you with a fresh line-up of products to taste and enjoy. Variety is the spice of life, and at Bin Ends, variety will be our way of life. – John Hafferty
