Behind the Tag
The Scoop on Wine Prices
That’s a simple question, but it’s surprisingly difficult to answer.
Wine is one of the world’s most regulated products, encountering several
touch points from grape to glass, each having the potential to increase its
costs. For starters, farming grapes involves land, labor, and transportation
costs. That cost is increased by sorting through fruit to remove unwanted items
(such as unripe grapes, or things you’d rather not have liquefied, like lizards),
and fermenting, aging, bottling, and storing the juice once pressed. Generally
speaking, the more expensive the raw materials are, the more expensive the
resulting wine will be.
But that’s just the beginning. Wine needs to be bottled, packaged,
exported/imported, distributed, marketed, and then sold through various
channels, with further costs (such as taxes and license fees) levied along
the way. As more than one winemaker has surely remarked, it can sometimes
seem like a miracle that a bottle of wine ever finds its way to a store shelf
at a reasonable price!
There’s also a key factor that trumps nearly all others when it comes
to the price that finally gets slapped onto a bottle of your favorite vino:
good old-fashioned supply and demand. Adam Smith and John Locke knew of what
they spoke hundreds of years ago: if a product is in demand, and supply is
low, you need to be prepared to pay through the nose for it. Wine is, of
course, no exception, and the most sought-after wines from the most storied
wine regions (Napa Valley, Bordeaux, and Burgundy, for example) are able
to charge whatever they think the market – that’s you – will pay.
Despite the complexity, wine prices can generally be divided up into a
few manageable categories. Within each price range, there are some guiding
principles regarding what you can expect, and where some of the relative
bargains can be found. Let’s take a look at how to navigate a few of those
$9 and Under
This is about as inexpensive as fine wine gets. Just as some
fast food joints can provide tasty experiences at bargain prices,
there are equally tasty wine experiences to be had in this lower
price range. What you shouldn’t expect here is wine made from the
best hand-harvested grapes aged in the finest French oak barrels.
What you should be able to get, however, are wines that genuinely
taste like the grapes from which they are made, are fault-free
(or “clean” as we wine geeks call them), fruity, simple, and meant
for early consumption – usually within one year. Grapes in this price
range are often sourced from a large geographic area (such as all of
California), and can include lesser-known varieties. All of
that helps contain costs and allows for a consistent “house
style.” California has this down pat, as do some Old World wine
regions like Spain and France. Chile, in South America, might be
the current king of bargains in this range.
When you step up in price to this range, you step up in grape
quality and production techniques. You also often see wines sourced
from a smaller range of vineyard areas and harvested in specific
vintages. The results are similar to the $9-and-under category, but
with a bit more aromatic complexity. This category is also where you
begin to see more well-known grape varieties (such as Chardonnay,
or Cabernet Sauvignon). Economies of scale, and/or low production
costs are the key factors in keeping a wine’s price within this
range. Look for offerings from Argentina, California, Australia,
France, Italy, Spain, and South Africa.
These are the shores of wine luxury land. At the top end
of this range, wine producers have many more techniques available
to them for producing higher-quality wine, including better fruit
sorting, increased labor, and more elegant aging tools such as oak
barrels. This is also the range in which smaller producers, who lack
economies of scale for keeping prices lower, can show off what they
can do. For those reasons, it’s the price point in which New York,
Virginia, New Zealand, Spain, Portugal, Germany, Greece, and Washington
State seem to thrive, offering complex, interesting, and tasty wines
with some aging potential.
Now we’re talking big bucks for most wine drinkers.
This is special-occasion wine territory, and you should expect
excellence: clean, expressive, complex, age-worthy wines. There
is a wide range of styles in this category, but it favors the
opulent, the luxuriant, or the age-able (and often a combination
of all three). At these price points, the highest-end production
techniques and vineyard sourcing are available to wine producers,
significantly increasing the quality of the wines (and the expense
to make them, which is passed on to you). This is also the price
range in which supply and demand starts to limit the bargain-hunting
possibilities. Look for specific appellations from well-regarded wine
regions, such as those in Oregon, California, Italy, Spain, Germany,
and France, and you likely won’t be disappointed.
$50 and Up
Once you get here, there is no upper limit. Most often, wines
in this range are made from grapes sourced from specific vineyards
or individual parcels within vineyards. They result from the best,
most labor-intensive production techniques, such as hand-harvesting
and hand-sorting fruit. Those expensive techniques only set the floor
of this price band. There are plenty of wines fetching more than $100
per bottle, and even some that command prices above $1,000 in extreme
cases. And that’s for current releases, not perfectly aged bottles
from storied vintages! The single biggest price determinants here?
Supply and demand plus brand-name recognition. Usually you will get
what you pay for here, but you will certainly pay for the privilege
of what you get.
The best thing about wine is that regardless of your budget,
there is something for you as long as you know what to look for.
Whether you’re shopping for a wedding anniversary, that perfect
bottle to impress your wine-loving friends, or simply because it’s
Thursday, you can expect to find a bottle that will please across
a range of price points.