StateoftheU.S.

WineIndustry2026

WrittenbyRobMcMillanEVP&Founder

SiliconValleyBankWineDivision

Contents

1Introduction32Executivesummary43Reviewoflastyear’spredictions54AnnualSVBStateoftheU.S.WineIndustrysurvey95Successguide226U.S.Winedemand,correctionandlength317Financialperformancetrends&benchmarks408Technicalappendix44

STATEOFTHEU.S.WINEINDUSTRY20262

Introduction

For26consecutiveyears,SiliconValleyBankhaspublishedtheStateofthe

U.S.WineIndustryReport,offeringwineries,growers,distributors,lenders,educators,thepress,andthebroadersupplychainaclearviewofwherethewineindustry

stands,howwegothere,andwhatthefutureholds.

Thisreportisn’tjustanacademicexercise.Itspurposeistoharnessinsightsfrom

someofthemostexperiencedinsidersinthewinebusiness,providinganunmatched,data-drivenunderstandingofindustryrisks,opportunitiesandrealities.Butweneverstoptryingtoimprove,andthisyearyou’llnoticeachangethatreflectsindustry

needs.

Startingwiththe2018report,webeganalertingtheindustrytoanapproaching

demandcorrectionthatwouldrequirearesponse.Thebusinesswasotherwisedoingwellsoapredictionofthattypewasn’tgratefullyreceived.But,wewereoutaheadoftrendsasathoughtleadershouldbe.Nowthatwe’rehere,there’snoneedtotellyouaboutthethreatthathasarrived;everyonenowknowsandunderstands.So,we’re

refocusingourviewtorecovery.

Ourgoalwiththereportispartlytoraiseawareness.Weallneedtobeattentivetothefactorsthatsurroundourbusiness.Wewillstillprovideyouwithourviewofthecurrentindustrydynamics.Butstartingwiththisreport,ourprimarygoal—withcontinued

industrycooperationinourtwosurveys—istooffermorebenchmarkingandplanningtools,uniquestreet-levelintelligenceandideastohelpyouadapt.

Afterreadingthisreport,wehopeyouwillcomeawayinspiredandequippedwithactionplansthatenhanceyourchancesofsuccessin2026andbeyond.

RobMcMillan

RobMcMillan

EVP&Founder,

SVBWineDivision

rmcmillan@

RobMcMillanisoneofthetopwine-businessanalystsintheUnitedStatesandtheauthorofSiliconValleyBank’shighlyregardedannual

StateoftheWineIndustryReport,describedbyTheNewYorkTimesas“probablythemost

influentialanalysisofitskind.”

WithRob’sdecadesofexperienceresearching

theindustryandworkingwithwineryclients,hisviewsaresoughtafterandtrustedbywinery

owners,journalists,entrepreneursandinvestors.

Heisaprominentspeaker,domesticallyand

STATEOFTHEU.S.WINEINDUSTRY20263

internationally,andyouwillfindhimextensivelyquotedinthenational,regionalandtradepress.

Executivesummary

TheU.S.wineindustryenters2026inaperioddefinedasmuchbychallengeasbyopportunityforthosewillingtoevolve.Acrosseverydatasetinthisreport,

onefindingisunmistakable:successtodayisbehavioral.Youhavetoseetheproblemclearlyanddecidetoreorientyourmessagetowardsanevolved,andyoungerconsumerbasewithdifferentdesiresandvalues.

Thelongeraofpassivedemand—whenvisitation,distributorpullandautomaticclubgrowthcouldmaskstrategicshortcomings—hasended.Whathasemergedisawideningperformancegapinwhichtheupperquartilewineriescontinuetogrowdespiteindustrycontraction,whilethelowerquartilesstruggletoadapt.

Thisdivideisevidentnotonlyinsalesgrowthandpricingpowerbutinhow

wineriesdescribetheiryear.Top-performersfocusondialed-inconsumer

engagement,disciplinedinventoryandfinancialmanagement,moreprecise

brandpositioning,andhospitality-centeredexperiencesthatbuildloyaltyratherthanthroughput.Digitaltoolsamplifytheseeffortsratherthansubstitutingfor

them.

Bycontrast,lower-performingwineriesciteslowingtraffic,distributor

disengagement,discountingandrisingcosts—responsesthat,whileaccurate,reflectthelackofstrategicattention.Weareatapointwheretheproblemhasbeenidentified.Nowweneedlaserfocusonsolvingtheproblem.

TheSVBdemographicandcohortconsumptionapproachreinforceswhythesebehavioraldifferencesmatter.Consumptionremainsunderpressure.Thatsaid,thereisgoodnewsasthesteepestpartofthedownturnappearstobewaning

andouranalysissuggestsweareenteringanewphaseinthecorrection.Yes,

2026willstillbeachallengingyear,buttheindustryisatleastapproachinga

pointofstabilization.Therecoverythatfollowswillfavorthosealreadyexecutingoutward-facing,consumer-drivenstrategies.

Keyforecastoutputs

2025year-endvolume:~329millioncases(downfrom335.9millionin2024)

2025year-endrevenue:~$74.3billion(downfrom$75.5billion)

TimingofImprovement:Declinesmoderatingin2026;abumpybottomformingin2027–2028,followedbyslow,modestgrowththereafter

Aswemovethroughthisdemandcorrection,wecanseetheindustryis

bifurcatingintothosedoingwellandthosenotdoingsowell.Sincetheindustrywilldownsize,youdon’twanttobeinthatsecondgrouptoday.

Thenextphaseofthiscorrectionwillrewardwineriesthatplanwithclarity,

engagewithpurposeandadaptwithdiscipline.Saidsuccinctly,thenextphasewillrewardthosewhorecognizethereasonsbehindthechangingdemandandthenfundamentallychangetheirbusinessestoaccommodateit.Thosewho

continuetodowhatthey’vealwaysdonewillfindtheirstrategiesfailingastheywatchfromthesidelines,clingingtothefrayingbeliefthattheirwayhasalwaysworkedbefore.

Whilewearepredictingchange,Ineedtounderscorethatthemostcrucialgoalisn’tbeingrightaboutexactlywhenthecorrectionbottoms,asifthebottom

means,“we’llallreturntonormal.”Thatthinkingwillbeyourundoing.The

bottomwillarriveforyourbusinesswhenthetimeisright.Themostimportantgoalnowistobepredictiveoftheevolvedconsumer,identifyopportunities,andpreparetobenefitfromachangedbusinessasmarketdemandbottoms.

STATEOFTHEU.S.WINEINDUSTRY20264

Reviewoflastyear’spredictions

Lastyear,wesaidthefollowing:

“Premiumwinerieswouldseeslowerdollargrowthbutremainstablerelativetothebroadermarket.Clubswouldcontinuetostrugglewithretention.Off-

premisevolumewouldfallagain,impactedbysoftnessbelow$12and

increasedcompetitionfromspiritsandRTDs.On-premisewouldrecover

moderately,butnottopre-COVIDlevels,asconsumersreallocatedspendingacrossawidervarietyofbeveragecategories.”

Wealsopredictedthat:

Totalvolumedemandedwouldcontinuetotrenddownward.

Valuewouldflattenaspricingpowerweakenedandweenteredadiscountingenvironment.

Oversupplywouldremainadefiningfeatureofthebusiness.

Distributorconsolidationandbrandprioritizationwouldintensify.

Youngerconsumerswouldadoptthecategorylaterinlifeandatlowerconsumptionlevels.

Andwesaidthatthepremiumsegment—particularly$20–$40wines—wouldremainrelativelyresilient,butnotimmunetothebroadermarketcorrection.

Whatwegotright

Wehitonmostofourpredictions.

Volumediddecline,consistentwithprojections.

Valueflattenedinadiscountingenvironment,heldupbythepremiumsegment,buteventhathasbeguntosoften.

Theunder-$12categorydeterioratedmorerapidly,pushingproductionlevelvolumestotheirlowestinmorethanadecade.

On-premisewaffledinwithvisitation,butchecksincreasedalongwithinflation,consistentwithpredictionsofa“partialrecovery.”

Wholesaleremainedchallenging,asdistributorscontinuedtositonalargebackupofalcoholandstreamlinedportfolioswhileredirectingfocustowardhigher-turningSKUs.

Youngerconsumersremainedfragmentedacrossbeveragetypes,

reinforcingthepredictionthatwineislosingitshistoricalgenerationalanchor.Yetthereishopeinthe32–46-year-oldalcoholbeverage

consumers.

STATEOFTHEU.S.WINEINDUSTRY20265

Whatwemissed

Weperformedremarkablywellbutdidn’tgivesufficientweighttotwofactors:

1.Thepathofdiscountinginwholesaleandretail.

Wepredictedthatthiswouldcontinuetobeadiscountingenvironment,butweresurprisedtherewasn’tgreaterevidenceintheretailscandata.

Discountingistakingplace,butmuchofthediscountingistakingplaceinlessobviousprivatelabelsales.

Whiletherearenogoodsourcesofaccurateprivate-labelsalesdata,

basedoncompanyreports,webelievethevastamountofhigh-qualitybulkwineavailableiscreatingcompellingconsumervalueinprivate-label,

wherewinedemandisgrowingindoubledigits,ledbyTotalWine&MoreandCostcobut,extendingintomainstreamestablishmentslikeKroger.

Thatisapositiveformofdiscountingthatattractsnewvalue-seeking

consumers,protectsexistingbrandvalueandhelpsdraintheoceanofbulkwine.

2.Thedegreeofpremiumslowdown.

Whilepremiumwinesremainstrongerthanthebroadercategory,demandsoftenedfasterthananticipated,drivenbyinflationarypressure,shifting

discretionaryspendingandadeclineinaffluentconsumerspending.

Visitationcontinuedtoerodeatsmallerhospitality-focusedwineries,whileaveragecheckheldinDTC,ordirect-to-consumer,salesatsmallDTC-

focusedwineriesslippedinallbutthetopquartile.

Thepremiumwineindustryandluxuryretailconsumersharesimilar

headwindsandrelatedimpacts.Whiletooextensiveofatopictocoverinthisreport,furtherideationisavailablebyreviewingtheBainWorldwideLuxuryGoodsMarketStudy,andtheStateofFashionfromMcKinsey&Company.

2026predictions

?Theoperatingenvironmentin2026willcontinuetoreflectthestructuralforcesreshapingwinedemand.

?Decliningvolume,valuecompression,andpersistentoversupply—remaininplace,yettherateofdeteriorationwillbeginslowingin2026.What

emergesfromthedataisapictureofamarketstillchallenged,butonewithstabilizationonthehorizon.

?Thereisagrowingdividecharacterizedbytheseparationbetweenwineriesthatadaptandthosethatremaintetheredtothepreviouseraofstrong

growth.Withnoimmediateincreaseindemandinsight,right-sizingindustryproductioncapacitybecomesareality.

?2026willmarkthepointinthiscorrectionwheresomegrowersandwine

companiesthathavestruggledforthepastfiveyearswillpubliclycapitulateandexit.Thepresswilllikelyfocusonthosespecificdisappointingbusinessoutcomes.Whilethereisnowaytohidefromit,thatwillobfuscateprogressfromupper-quartilebusinessesandtheimprovementthatIexpecttosee

fromaslowingrateofdecline.

STATEOFTHEU.S.WINEINDUSTRY20266

2026predictions(continued)

Continuedbutmoderatingvolumedeclines

ThedeclineintotalU.S.winevolumeisexpectedtopersistinto2026,butthesteepestcontractionappearsbehindus.

Demandsoftnesswillcontinueacrosspricetiers,particularlybelow$12.Yet,thedemographicdragthathasdefinedthepastseveralyearswill

begintoeaseasthepopulationof30–45-year-oldconsumersmovesdeeperintowine-friendlylifestages.

Themarkethasnotyetfoundabottom,buttheslopeofdeclineis

flatteningslightly,signalingthattheindustryismovingfromanacutecontractiontowardagradualbottoming.

Valuepressureinthepremiumsegment

Premiumwinerieswillfaceongoingheadwinds,includingweakerwineclubretention,lowertastingroomconversionratesandrisingpriceresistance.

Whilethepremiumtierwillcontinuetooutperformthelower-pricedsegment,itisnotinsulatedfrombroaderconsumerchange.

Inflationaryfatigue,shiftingdiscretionaryprioritiesandaslowdowninaffluentconsumerspendinghavetemperedpricingpower.

Premiumdemandremainsviable,butitnowrequiresmorepersuasivevaluecommunicationand/orhospitality-leddifferentiationratherthanrelyingsolelyonpriceincreases.

Newpathstopromoteandsellwinearenecessary.Pricinghastobeapartofyourstrategyformulationandnotastrategyinitself.Itmustbeincludedwhenevaluatingnewsellingoptions.

Oversupplyremainsastructuralheadwind

Whilethepricingofgrapecontractsispartoftheissuewithunfilledgrapecontracts,insomecases,loweringthepricetozeroisn’tsufficienttohaveallproductionundercontract.Moreacreagewillhavetoberemoved,

particularlyinregionsproducingforlessexpensivebrands.

WearestillsupportiveofaUSDAMarketingOrdertohelpthecategory.

Whilediscussionsareunderwayinseveralcircles,giventhedisappointingexperiencewithWineRAMPin2021,Ibelievetheoddsofindustrytractionforacollaborativesolutionremainlow.I’dlovetobewrong..

Premiumwineriesarefeelingthetensionbetweenholdingbackthenextreleaseordiscountingacurrentslow-movingvintage.Tacticalcreativityinsellingisthemandate.Thespecificsolutioniswineryandregionspecific.

Improvementhastostartinretailsalesbeforewecanexpecttosee

bloatedwholesaleinventoriesimprove.Whileweexpectprogressonboth,thesupplychainwon’tbefullyinbalanceattheendof2026

Thereistoomuchplantedacreageinspecificpremiumvarietals.ThetimeisbecomingripewhensomegrowersinthebestAVAswillfindsuccess

experimentingwithvarietalsthatweresuccessfuldecadesagoandmightappealagainasanentrypricedpremiumwine.Thatisnotalicensetoripwithoutasalesplan.

STATEOFTHEU.S.WINEINDUSTRY20267

Outlookandguidancefor2026

2026willbeanotherchallengingyear,yetatransitionalyearwheresomewineriesandgrowerswillclosetheirdoorswhileothersstaketheirclaimtothefutureofwine.

Iwouldcautionbelievinganyonewhosuggeststhat2026willbringwithitgrowth.That

isjustunsupportedhope.Themathisn’tthere.However,themarketisbeginningtoformabottom,especiallyinthepremiumsegment.

It’sstillearlyinthegame,butouranalysisleadsustobelievethatgreenshootswillbegintoemergeinlater2026andthebottomwillshowitselfin2027and2028.

Thewineriesbestpositionedforthenexterawillbethosewithanexternalviewnow,thosewhounderstandtheopportunitytomorrowandwhowilldevelopstrategiesto

moveawayfromdatedbutembeddedtacticswe’vegrownaccustomedtoandwillfindwhat’snext.

IworryaboutallthepeoplewhoI’vespokenwiththatareholdingonbytheirfingernailsandwaitingforabottomasif“everythingwillgobacktonormal.”Tothose,Ihavetobeplainspoken:Whathasbeennormalwillnotbenormalagain.Therisingtidewon’tliftallboatsafterwebottom.Youhavetoevolvenowtoberelevantandtakeadvantageof

what’scoming.

RNDC’sexitfromCaliforniaisasymptomofotherissuesourwholesalepartnersare

dealingwith.Theywillcontinuetogothroughtransformativechangeintheyearsahead.

DtCtacticsneedtoevolvefromtheoverrelianceonhospitalityandexperienceatthewinery,toanexpandedviewofDtCthatmeetstheconsumerwheretheylive.

Themostimportantgoalistoberelevanttothelifestylesofadifferentconsumer.Youhavetocompetetoearnshareandbeapartofthatconsumers’occasionswhentheychoosetodrink.

STATEOFTHEU.S.WINEINDUSTRY20268

TheannualSVB

StateoftheU.S.WineIndustry

survey

STATEOFTHEU.S.WINEINDUSTRY20269

TheannualSVBStateofthe

U.S.WineIndustrysurvey

TheAnnualSVBWineIndustrysurvey

AsI’vesaidovertheyears,averagesdon’talwaystellthewhole

story.Oursurveyresultsthisyearshowthatdemandremainssoft,wholesaleinventoriesarestillnormalizingandownersacrossthecountryarefeelingtheweightofthisshift.Yetthedatatellsamorenuancedstorythanlowersales.

Thatnuancedreadrevealsanincreasinglybifurcatedmarket:a

bottomquartileofwineriesclearlystrugglingwithsaleserosionandrisingcosts,butatopquartilethatcontinuestogrowbyleaningintodirect-to-consumer,sharpeningtheirvalueproposition,managing

inventorywithdisciplineandstayingclosetotheconsumer.

Throughoutthesurvey,thecontrastbetweenthesegroupsbecomesarecognizablepattern,settingupthenextsectiononSuccess

Metrics.

STATEOFTHEU.S.WINEINDUSTRY202610

WinerySentimentIndex–

Industrybifurcationisacommontheme.

TheWinerySentimentIndex—ourleadslideinthisreport—capturesproducers'stateofmindfortheyear.Netsentimentslippedfurtherintonegativeterritory,reflectingayearthatmany

describeas“challenging,”“difficult”or“disappointing.”

Butwithinthatgloomyheadlinesitsanotablepositive:theshareofwineriesreportinga

betteryearincreasedslightly.Thatmeansthetopquartileispullingawayfromtherestofthepackdespitethemarket’scontraction.

Reinforcingthisdivide,top-performingwineriesdescribe“high-touchDTC,”“bootsonthe

groundinkeymarkets”andafocusonan

evolvingsetofexperiencesbothat,andapartfromthetastingroom.

Strugglingwineriesmoreoftenpointtogenericforceslike“slowtraffic,”“competition”and

cost-cutting,asignoflessstrategicadaptation.

TheonlypositivecomponentoftheNet

SentimentIndexinthissurveyisgrapesupplywhichisabundant.Asthesurveyiswineries

only,that’snotasurprise.

Netsentimentindex

Total“positive”responsestoeachcategory,minustotal“negative”responses

toeachcategorydividedbytotalresponses

60

40

20

0

-20

-40

-60

-80

4543

19

21

13

13

9

10

9

1

1

-2

-12

-2

-2

-11

-6-9-7-12

-15

-17

-17

-14

-23

-21

-24-24

-33-35-35

-24

-23

-23

-29

-27

-30

-30

-29

-34

-35

-32

-36

-39

-36

-40

-43

-52

-53

-56

-55

-58

-59

-66

-73

Overall

Sales

channels

Grape

supply

Capital

EconomyConsumerdemand

LaborAlcohol

laws

ForeignSubstitutesWater

competitionavailability*

n20212022n20232024n2025

*Wateravailabilityfirsttrackedin2021

STATEOFTHEU.S.WINEINDUSTRY202611

Source:SVBStateoftheU.S.WineIndustrySurvey

Overallperformance:Mixed

Whensurveyingmembersofthewineindustry,weliketosay,"Don’tspendtoomuchtime

thinkingaboutthequestion.Inthiscasethe

questionwasonewithoutanumericresponse,justagut-level“Howwasyouryear?”

Resultsshowthatroughlyhalfofwineriesrate2025negatively,andaboutathirdrateit

positively,aslightdeclinefromlastyear.

RegionsincludingVirginia,PasoRoblesandSantaBarbaraonceagainfeatureahighershareofpositiveresults.

Sortingrespondentsintosales-growthquartilesilluminatesthepattern.Top-quartilewineries

aresmalleronaverageandmoreplannedinexecution.

Theircommentsshowproactiveapproaches:refiningclubofferings,adjustinginventoryandSKUcounts,deployingtargetedhospitalityandcost-cuttingthatseeksareturnoninvestment.

Bottom-quartilerespondentstendtorelymoreheavilyontraditionalwholesaleandreport

fewerspecificstrategicadjustments.WithDtCperformingbetterthanwholesaleinthissurvey,theresultisn’tsurprising.

Howwasyouryear?

Percentofrespondents

30%

25%

20%

15%

10%

5%

0%

2022202320242025

28%

26%26%

24%

22%

21%

22%22%

19%

20%

18%

17%

16%

17%

12%

11%

12%11%

8%7%

6%

7%

6%

6%

7%5%

3%1%

ThemostdifficultOneofourmostyearinourchallengingyears

historyever

Adisappointingyear

Neitheragood

yearorabad

year

AgoodyearOneofourbetteryears

Thebestyearinourhistory

STATEOFTHEU.S.WINEINDUSTRY202612

Source:SVBStateoftheU.S.WineIndustrySurvey

Financialhealth:63%reporttheirfinancialconditionasgoodorstronger

Again,top-quartileparticipantslookdifferent.

Theyreportdouble-digitrevenuegrowth,

improvedcostmanagementandtightercontroloverworkingcapital.

Thebottomquartileshowsrevenuedeclines,risinginventoriesandincreasedrelianceondebt.

Emergingfroma25-yeargrowthperiod,

managersareunfamiliarwithhandlingthekindofdislocatingchangeweseetoday.Inpast

decades,ifyouhadtoomuchinventory,thereweremanyescapevalves,anddoingnothingwasaviablestrategy.Inanincreasingdemandenvironment,heavyinventoryinthecellaronlyrequiredlowerplannedproductioninthe

currentperiod.Thehigherdemandotherwisewoulderasetheoveragequickly.

Thatisanexampleofthetypeofstrategythatwon’tworktoday,unlessyouareupperquartileandyoursalesareincreasing.

Trendofwineryfinancialhealth

2022202320242025

Percentageofrespondents

31%31%

30%31%

27%

25%

24%

24%

22%

19%

19%

19%

13%13%

11%

10%

9%

7%

7%

6%6%7%

5%4%

VeryweakSlightlyweakGoodStrongVerystrongRocksolid

STATEOFTHEU.S.WINEINDUSTRY202613

Source:SVBStateoftheU.S.WineIndustrySurvey

Baselinecomments

Ourobservationisthatthemosteffectivemanagementteamsaremoreinclinedtotakemeasuredrisksandadapt,evenundercostmanagementpressures.

Thatsaid,theoveralltrendinself-reportedfinancialhealthcontinuestoslip,withfewerwineriesdescribingtheirconditionas“strong”or

“verystrong.”Higherinputcosts,risinginterestratesandflat

revenuesarecompressingmargins.Butformostwineries,thismarketisn’tyetacrisis.

Fewwineriesincreasedgrapepurchasesin2025,andseveral

regionsleftmeaningfultonnageunharvested.InCalifornia,the

harvestestimateisbelow2.2Mtons.Thiswasaproductionsegmentthatcouldproduce4M+tonsinagoodyear,whichgivesyouanideaofthedepthofover-plantingandthecurrentbubbletheindustryhastodealwith.

Somebelievetheshortharvestof2025willhelpmoregrowersfind

contractsin2026andbeyond.Theproblemwiththatlogicisthat

thereisn’tsufficientpull-throughtodaytoreducetheinventorybubbleatwholesale.Withoutreducingsupply,producersaren’tgoingto

contractformorefruit.Thebestwecansayisthelightharvestwon’tmakethesituationworse.

Thepremiumindustryenteredthiscorrectionwithrelativelyhealthy

balancesheetsin2020giventhelightharvestthatyearfromfiresontheentiretyoftheWestCoast.Fewwereaggressivelyexpandingnewvineyardplantings.Mostcanstillweatheraprolongedadjustment;

however,thereisnodenyingthatwehavetoomanySKUsandtoomanywineriesforcurrentdemand.

STATEOFTHEU.S.WINEINDUSTRY202614

Inventoryandsupply:Slowly

workingthroughtheoverhang

Despitebroaderindustryoversupply,mostpremiumwineriesreportbalancedtoslightlyheavyinventories.Still,15%reporthavinganexcessiveamountofwinerelativetocurrentdemand,soweknowthereistoo

muchwineavailable.Notwithstandingthesurveyed

inventorypositions,financialbenchmarks,asyouwillreadlaterinthereport,indicateinventoriescontinuetoexpand.Some,butnotallofthatincreaseisduetoinflationandcostincreases.

Thebestactionformostproducersinthismarketistocontinuecontractingwithgrowersimportantto

yourbrand,buttodependmoretothespotmarketforgrapesaroundharvesttofillouttheirremaininggrapeneeds.

Webelievewearestilloverplantedinmostregions

whichwillleadtohigherlevelsofuncontractedfruitatharvestandpricereductionsonthespotmarketin

2026.

Inventory/winesupply

15%

44%

Webelievethesupplyofourwineiswelloverwhatweneedtomeettheexpecteddemand.

Webelievethesupplyofourwineis

moderatelyinexcessofwhatweneedtomeettheexpecteddemand.

30%

Webelievethesupplyofourwineis

8%

sufficientfortheexpecteddemandforourwine.

Webelievethesupplyofourwineis

somewhatshortoftheexpecteddemand.

2%

Webelievethesupplyofourwineisveryshortoftheexpecteddemand.

1%

Noneoftheabove

0%10%20%30%40%50%

Proportionofrespondents

STATEOFTHEU.S.WINEINDUSTRY202615

Source:SVBStateoftheU.S.WineIndustrySurvey

Thereisanopportunitytodifferentiate

DTCchannels—tastingroomsandwineclubs—againaccountformorethanhalfoftheaveragewinery’srevenue.Wholesalecontributesroughlyone-thirdofsalesonaverage,butwineriesleveragingwholesaleintoday’smarketareexperiencinglesssuccess.Evenamiddeclinesinvisitation,DTCremainsthe

economicengineofthepremiumwinebusiness.

Regionalandsizedifferencesaresharp.PasoRobles,

Virginia,TexasandSantaBarbarashowexceptionallyhigh

DTCshares.Largerwineriesstillrelymoreheavilyon

wholesale.Seekinggrowthandmargin,mid-sizedproducershaveincreasedtheirDTCpercentageoverthelastfiveyears.

Top-quartilewineriesconsistentlyexhibitgreaterDTCdependenceandastrongeremphasisonexperiences.

Commentsfromsurveyrespondentshighlighthospitality

innovations,targetedsmall-groupprogramming,andtightercurationofclubtiers.Thesewineriesareplacingmore

emphasisonusingDTCasavalue-addedrelationshipchannel,notsimplyapointofsale.

Whatisfascinatingisthatwhilethetopquartilesofperformersaredoublingdownondecliningvisitationanddirectsales,

thosetakinganovelapproacharefew.Thattellsmethereisanopportunityformanywineriestotakeariskbyinvestinginregionsoutsideoftheirhomestate.Ataminimum,wineriesshouldbetestingideasandseekingthewayforward,ratherthandoingmoreofthesame.

Saleschannelmix:DTCisstillthemarginengine

2025

Wineclub,25%

Tastingroom,28%

Phone,1%Other,4%

Exports,2%

Wholesale-

off-premise,18%

Mailinglist/subscription/allocation,5%

Online,6%

Wholesale-

on-premise,12%

STATEOFTHEU.S.WINEINDUSTRY202616

Source:SVBStateoftheU.S.WineIndustrySurvey

PercentofrevenuefromDTCsalesbyregion

PasoRobles Virginia Texas AverageSantaBarbaraNapaCounty

SantaCruz&Monterey OtherUSWashington New