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Virginia and Golden State vineyards share mutual problem: water
As one travels through California this summer, lush vineyards are ubiquitous. But if you glance beyond the undulating rows of manicured-like vines, it’s scorched hills that dominate the views.
Drought has struck—and struck hard—in the state that produces 90 percent of all wine made in the U.S. And the driest part of its growing season lies ahead.
This writer recently spent ten days on a 1,300 mile road trip visiting with numerous winery owners and staff. The picture that emerged is unsettling and causing serious concern in every wine growing region in the state, from Temecula in the south to the Anderson Valley in the north.
Conversely, Virginia’s landscape appears almost jungle-like as spring and summer rains have vineyards producing heavy vine canopy that will demand regular pruning and spraying to turn the BB size grapes into plump, juicy bottles of wine.
In May, John Delmare, owner of Rappahannock Cellars in Huntly said, “We had a lot of rain early here this year and bud break was so late our vines have barely been growing for six weeks now. Temperatures have been cool and with the late bud break we don’t have near the canopy growing we normally would.
“But with 15 years of growing here I won’t panic until September,” he said chuckling.
Nonetheless, excess water in the form of either rain or humidity is a problem California wineries don’t have to deal with. In fact, the daily summer mantra of the Virginia weatherman, “with a chance of showers and thunderstorms in the afternoon” is seldom heard in California.
One marker for meeting the moisture challenge is the scope of spraying programs employed in the Old Dominion compared to California. Typically out West, vineyards are sprayed two to three times a season. In Virginia, 12 to 14 applications are normal and can go over 20 during a wet and humid growing season; protecting vines from fungi and mildews is paramount.
In 2011, a dry summer foretold of a stellar harvest only to have it drowned out by heavy September rains and a cool October. One nine day period in September saw 12 inches of rain fall in the Charlottesville area resulting in waterlogged grapes.
To the north, the U.S. department of Agriculture has declared the Finger Lakes wine region a disaster area after wave after wave of “polar vortexs” damaged up to 100 percent of some vineyards.
Many grape farmers will need to replant vineyards damaged by the long deep freeze that saw sustained temperatures hover between -7 to -18 degrees Fahrenheit.
The heart of winemaking is farming. Lord Amherst, commander-in-chief of the British forces in the late 1700s said, “There are three easy ways of losing money; racing is the quickest, women the most pleasant and farming the most certain.”
And it is most certain that if significant rains do not fall in California in 2015, dry wine will have an entirely new meaning for American wine lovers.
California is historically a dry state so droughts are not a new experience. Water is supplied through a complex infrastructure developed over decades. Winter rains and mountain snows fill reservoirs and irrigation ditches that drive agricultural production in normal years. But for the last seven years normal has not been normal.
Today, the entire state is officially in drought, the worst since the mid-1850s. B. Lynn Ingram, a paleoclimatologist at the University of California at Berkeley, believes the state may be headed for a megadrought of 200 years or more. “During the medieval period there was over a century of drought in the Southwest and California. The past repeats itself.”
Indeed, a millennium ago native tribes waited for winter rains that never arrived. The following years the wait continued until the marshes of the San Francisco Bay turned from cattails to salt grass, resulting in the loss of rich fishing grounds. The Indians packed up and left the region in search of water. Might this be the fate of the state’s winemakers?
Most scientists are reserving judgment but agree the past century has been exceptionally moist and warm in California and an extended drought could be measured in decades, if not centuries.
Bright-eyed optimists are convinced that 2015 will see the return of an El Niño and heavy rains. In fact, warm water is being observed in the depths of the Pacific Ocean now, a precursor of a rainy season. If is rises to the surface in the next several months, it could trigger an intense El Niño effect. Keep your Farmers’ Almanac handy.
With this preamble on the California water issue, slide into the back seat of the rental car as this writer and his wife head out on a wine odyssey.
Located thirty minutes north of Santa Barbara, this area is home to the Neverland Ranch, the late Michael Jackson’s colorful 3,000 acre property. But there be will no swing by to gander at the edifice. The task at hand is wine.
At Firestone Vineyards the knowledgeable guide explains the challenge of growing grapes in a desert-like environment.
“We recently planted a block of 16,000 new vines to replace ones destroyed by root rot. At $20 per vine and four years before maturity with an additional few years more before a sufficient quantity can be harvested, a good bottle of wine is expensive to produce.” “We have four different reservoirs plus two wells, enough water for about a year. We have pruned from typical four shoots down to two, focusing on quality not quantity.The drought will likely dictate an early harvest.”
At Bridlewood Estate Winery, an employee said, “In the past, we’ve had a 10 year drought cycle and old timers don’t get nervous. But with three straight years of drought everybody is now getting nervous.” The winery has two years supply of water sourced from ground wells that produce 40,000 cases of wine annually.
Two terms you hear a lot of are “dry farming” and “drip irrigation”.The former involves no watering of the vines. This is “tough love” grape farming and forces the vines to seek cooler moist soil at depths of 15 to 30 feet. It is not employed without some risk and in extreme conditions some water would likely need to be applied. The latter produces a slow drip of water through polytubing suspended about a foot above the vine’s base and is used sparingly.
Bridlewood employs drip irrigation. The winery already sources some of its grapes from outside of California, mostly from Oregon and Washington. Federal law permits up to 25 percent of wine from another state to be bottled and still labeled with the receiving state’s name. If the drought worsens, it’s a strategy an increasing number of wineries could use.
Foxen Winery is located in the rural area of Santa Ynez near the eponymous Fess Parker Winery. The landscape is palpably dry with broad vistas of rolling brown hills and fields of straw colored grasses. Extended hikes in the region would demand a day pack full of bottled water.
“Next year we will be hugely affected by the drought,” explains the tasting room host. “Wine prices could get ridiculous.” The winery does both dry and drip irrigation. “In our drip vineyards our winemaker is seeing so much fruit he is having to drop 50 per cent of it”, a strategy designed to conserve vine energy and produce deeply flavored wines. “We’ve also shorten the cordons” (the branches extending from the trunk that will produce the fruit).
The technique draws down energy demands of the vine. “Next year forecasters are predicting an El Niño that will turn everything around. We are staying as positive as we can” she said.
Before leaving Santa Ynez, a stop at the Roblar Winery elicits a telling comment from our host, “Lake Cuchuma is ridiculously dry. We’ve only had about five or six days of rain in the last year. The ocean fog does provide some moisture.” The nearby 3,100 surface acre lake is at thirty-nine percent of its capacity.
Moving north and entering the county of San Luis Obispo—home to some 300 wineries—temperatures rise to the upper eighties with low humidity. It’s apparent the drought has applied brute force to the region.
An extended conversation with a long time grape grower and winemaker was as revealing as it was heartbreaking. “The big question I have this season is, ‘will my well run dry,’” said Jim Jacobsen, who along with his wife Mary Beth, have been farming fruit and grapes for over 40 years, the last 17 at his winery Doce Robles.
“My well is not dry yet but I’m hearing my neighbor’s went dry recently.” Jacobsen farms mostly red grapes such as Cabernet Sauvignon, Merlot, Syrah, Barbera, Malbec and Petit Syrah. White wines don’t thrive well in the hot countryside but his Viognier was tasty.
“In 17 years, I’ve only flushed my well filters four or five times. I have really clear water. But at the end of last season, I was flushing daily because of dirt starting to come up from the bottom. I’m just hoping we make it another year,” said Jacobsen.
It’s the same story heard from wine farmers throughout the region. Vine growers on the east side of town are hurting a bit more than those on the west side nearer to the ocean, but “the long term prognosis is not good for them either.” Jacobsen’s well is 300 feet deep and he opines that some of the other wineries have deeper and larger wells to help survive the summer.
He currently is drip irrigating his 36 acres of vines over an 11 day cycle. “I can survive one year without a crop. I can’t survive four,” referring to the length of time it takes for a new vineyard to start producing some fruit to make wine. “I have never been in a situation when I didn’t have rain to grow fruit.”
Jacobson thinks the problem isn’t ultimately the lack of rain but the failure of the state to conserve its precious water sources. “If we get a wet winter, nobody worries about it. We need to build more dams,” he states.
As the visit draws to a close, his wife Mary Beth echoes the soon-to-be commonly heard refrain, “They are predicting an El Niño next year.”
As one proceeds up Highway 101, with Paso Robles fading in the rearview mirror, the landscape turns as flat as the Bonneville Salt Flats. But instead of a barren white landscape, miles of irrigated fruits and vegetables are on display. The Central Valley stretches some 450 miles long but it’s the southern half that will feel the first impact of the drought.
It is estimated the state’s agricultural economy will lose $1.7 billion this year, leaving some 14,500 farm workers without jobs all because farmers will receive one-third less irrigation water. Not only are wine drinkers nationwide going to be feel the drought’s impact, so will anyone who enjoys fruits, vegetables and nuts. Everyone will likely have to dig deeper in their wallets to enjoy this region’s normally bountiful agricultural products.
Napa and Sonoma
Moving still further north, one enters the Valhalla of wine growing in the U.S., Napa and Sonoma County. Legendary wineries abound here as do enormous amounts of money and prestige. An acre of prime Napa vineyard can exceed $300,000. Given what is at stake if the motherland were to go dry, wineries here monitor water supplies and vineyard stresses closely to assure the vines remain viable.
Ground water can be accurately measured and a vine leaf can be placed in a pressure chamber to extract stem water and determine the specific level of stress the plant is encountering. Seemingly no technical tool available is left unused to coddle the vines. At Martin Ray Winery in Sonoma, Greg Ray (no relation), is the wine club and e-commerce manager.
“The drought has not affected us too drastically. We’ll start seeing more prominent effects as get we further into the summer,” he said. The majority of the winery’s grapes are dry farmed and rely on drip irrigation only when plant stress rises. “Droughts are fantastic for the vines. They love it.” It’s true. The harder a vine struggles the higher the quality of fruit that is forthcoming. But if the stress becomes cataclysmic an entire vineyard can go down.
After a fascinating two hour tour of Jack London’s early 1900s Beauty Ranch in southern Sonoma, a visit to nearby Benzinger Family Winery was in order. The hospitality host was again knowledgeable and friendly, an almost universal experience encountered at every winery.
“There is voluntary rationing of water throughout the state. Our last two vintages have been great so the warehouse is well stocked to meet a shortfall, if it occurs this year. We have been dealing with the water issue for about seven years,” he explains. An early harvest is predicted because of early bud break and the vineyard is two weeks ahead of where it was last year.
The majority of water is currently retained in the soils “so we’ll let the vines go through that before adding additional water. We also do water reclamation. All the water used at the winery, such as rinsing barrels and on the crushpad, goes into a “gray” water system and from there into man-made wetlands we’ve created. We save a million gallons of water annually using these processes. We do our best to conserve, he said.”
Chateau Montelena in Napa earned its bona fides in 1976 when its 1973 Chardonnay beat the best of white French wines in the historical competition dubbed “Judgment of Paris”. Our host was Nick Rugen, a winery chef and tasting room employee.
“With our estate reds and Zinfandel we practice ‘deficient irrigation’ watering only when we have to. In January, we came close to having to do so but received rains in February and March that really saved us. Our lake was bone dry and we were expecting see a die off of some of the vines. We are now back to about 70 percent where we need to be. So it hit the reset button on the drought. In the middle of June, it will start to heat up and we typically won’t see rain again until the end of October.”
Rugen recalls back in 2008, dry weather caused brush fires further north in the state and the resulting wine was tainted by smoke that covered the vineyards. “They claimed it was from using toasted wine barrels,” he said smiling. The story points up another threat from arid conditions.
In extreme situations the winery would drop all the fruit to save the vines. With the dry farmed blocks—no polytube lines installed—truck water would be brought in to irrigate. He also emphasized if die off began they would pump all the water out their lake to save the plants. Once again, the frequently heard refrain closed out the informative visit, “Let’s hope for an El Niño next winter.”
Two other visits to highly regarded Napa wineries reinforced many of the lamentations previously heard. Mumm Napa and Frog’s Leap wineries produce acclaimed wines and are within a short distance of each other. But Mumm grows no fruit on its property and has no wells because the climate in Napa is too warm for its lineup of sparkling wines. “Grapes for our wines wouldn’t be happy in this environment. We grow our fruit a little closer to the Bay Area,” states the host.
At Frog’s Leap, a young native of Michigan, Megan Anderson, poured wine and provided knowledgeable commentary on the winery and the drought. “Our two hundred and fifty acres are dry farmed. No irrigation, no pesticides, no fertilizers. We believe in nature taking care of nature,” explains Anderson. “Our concern rises when temperatures are above 90 degrees. But the roots of our vines go 20 to 30 feet deep where the soil has more moisture and is cooler. We have no ground wells on the property.”
When really hot weather occurs, water is sprinkled on the leaves to protect the grapes and foliage from sunburn. The root stock comes from Missouri and Texas and has been acclimated to hot weather since birth. “Our grapes are use to being hot and thirsty.”
It also helps that the winery is near the Napa River. And while it is located where the river is more “Goose Creek” than “Potomac” is does provide for a higher ground water table than other locations in the valley.
When pressed about a doomsday scenario, Anderson said, “We’ve never had drought and climate change like this before. We have no idea what will happen. Yes, we would have to do something but we still would not want to irrigate,” she said.
The visit crystallized the passion and knowledge brought to bear in producing fine wine. But it also underscored the subliminal fear and concern that accompanies the possible destruction of a life’s work.
Rounding out the Napa tour was a visit to the iconic Joseph Phelps Winery. An interesting footnote is that Phelps brought the Viognier grape to California from France back in the early 1980s thinking it could become the new chardonnay. But the state’s terroir was not conducive to expressing the best the grape had to offer. In 1991, Dennis Horton, owner of Horton Vineyards in Gordonsville, planted the grape on Virginia soil. The rest is wine history as the berry fell in love with the Old Dominion—hey, Virginia is for lovers—and it became the state’s signature white varietal.
The host at Phelps said dry farming is employed but not exclusively. “”We make the right decision when we need to. We use drip during the bloom and flowering growing period and during veraison (when the fruit turns golden or purple in August). A major expansion of the winery’s hospitality rooms are in progress and for the next 10 months tastings are held on a patio and temporary buildings below the main facility.
But sitting on the patio and focusing on the nearby vines a quiet drip, drip, drip was observed as the vines received an H2O transfusion. It was 87 degrees without a breath of air under a cloudless sky. July and August awaits.
Swinging back onto Highway 101 and leaving the Napa Valley behind, the winemobile headed for the last of the regions to be explored, the Anderson Valley.
The level landscape slowly gave way to hill country and the feeling of dryness was tangible even from inside the air conditioned car. Brown and straw-colored hills with muted green trees predominate here. Leaving Highway 101 and heading west on a twisting two lane road, the stark beauty further reinforced the image of extreme dry country.
Our primary destination was Roederer Estate, owned by the French champagne producer Louis Roederer. Buzz Busse was the hospitably host, a quiet spoken and knowledge retiree with an air of professionalism. A former engineer perhaps?
“The late spring rains saved us but we are still way behind. For those who believe in climate change we are experiencing it. This is the first year we’ve had really bad conditions,” he said.
The winery has 612 acres under vine and produces 110,000 cases annually, predominately sparklers. “Traditionally we receive 40 inches of rain a year but 60 to 80 inches is not unusual. But in the last five years if we got 30 inches we are jumping for joy. It’s expected to be closer to 20 this year.” And some of that rain did not fall when needed.
“In the last couple of years we’ve had rains in early October which played havoc with the grape harvest. Most of the entrapped water in our ponds is needed for frost protection” so can’t be used for it for heavy irrigation. Only light sprinkle irrigation is used during hot weather to protect the vines and fruit from sunburn. The winery does have wells on the property and they haven’t gone dry yet.
“We are keeping our fingers crossed. We’re not sure what’s going to happen.” This year we did long pruning. Normally we prune to two shoots but we went to four. If we do get frost, it will affect the outer shoots so we build in a scenario that will provide for fresh, younger shoots that will produce fruit. But that also raises the cost of production to have to double prune such large acreage,” he said.
Busse’s fellow host opined that she has mixed feelings about several recently purchased wind fans used to augment water misting to protect from frost. “Which is the lesser of the two evils? Using the environmentally unfriendly propane-powered fans or the water? “We also need to save water for the valley people. The locals say ‘Well, you shouldn’t being doing the fruit protection. You are hurting people. You should be like other farmers and let the drought run it course and have a bad year.’ The vines don’t need water to survive. They need water to produce fruit,” she states.
The discussion points up an interesting dilemma. When a natural resource becomes scarce, who has more entitlement to dwindling supplies?
Leaving the winery in the early afternoon, the azure sky and still air sends the temperature to 97 degrees. The valley and its people have a long, hot summer ahead.
The Virginia wine industry has much to be thankful for, notwithstanding its often overly moist environment.
As the wine journey comes to a close, thoughts drift to car a rental return and boarding passes. But the predominate emotions are concern and melancholy. Nature is once again impacting humans and their productive lives.
May the California wine industry live long and prosper.
Out of crisis opportunity?
If California wine production were to drop precipitously, would it create an opportunity for Virginia to become a major wine player?
In the short term, the limiting factor would be the amount of Virginia wine available for national distribution. The Old Dominion produces 511,000 cases annually. While it sounds substantial, it’s a mere drop in the wine glass of California’s production of 214 million cases.
But given the rising quality of Virginia wine, could the state attract investors to dramatically expand vineyard acreage if the Golden State’s wine bottle were to eventually run dry? The Nation’s annual vinous thirst—close to four billion bottles—is seemingly too great for investors not to jump in quickly to meet demand.
But think again.
Brian Roeder, owner of Barrel Oak Winery in Delaplane, said, “I don’t see a source of fruit coming out of Virginia to make something like that happen. Demand here is already outstripping supply.” Roeder thinks it is at least a decade-long problem that cannot be resolved quickly.
“I don’t see any conceivable way we could see the required dramatic investment. And on top of that, we still have our own problems with rain, with spraying, with bugs. We are going to see a whole series of environmental demands placed on us if California’s past experience is the rule.”
Roeder thinks it would be a formidable challenge for an investor to amass small vineyard parcels in Virginia and manage them for large scale wine production. “It would take a billionaire to do something like that,” he said.
What Roeder does think is feasible is the creation of wine factories that would aggregate finished wine and grapes from Europe, South America and the East Coast to produce a large-scale industry to meet demand from a multi-decade drought in California.
“We have the talent, the physical location and the access to European markets that California doesn’t have,” he said.
He also firmly believes the Commonwealth can become an agriculture-tourism wine destination. Virginia has it all with, “its beauty, its easy to reach location and the wealth of the region. We can become America’s Wine Country,” he said.
Published in the 2014 summer edition of the Piedmont Business Journal.
Guests encouraged to relax and savor Virginia
Here’s an unlikely question: Have you ever relaxed in a 3,500 square foot living room?
If not, then head down to Early Mountain Vineyards in Madison. Its expansive tasting room is one of the largest—and most comfortable—in the Old Dominion.
Comfy couches, oversized chairs, a fireplace and artfully placed tables produce an atmosphere conducive to lingering over a wide selection of Virginia wines. Management won’t encourage you to drink up and move on. Your task here is to settle in and sip.
“We want you to come in and relax. Here you are able to truly taste through a variety of wines and contemplate the nuances that each presents,” said General Manger Dave Kostelnik. “So maybe it’s a two or three hour trip to Early Mountain rather than the traditional winery visit.”
The success of that goal is reflected in the numbers. “We’ve seen attendance increase 30 percent over last year. It’s a big, comfortable but very elegant tasting room,” said Kostelnik.
The overall winery itself is an expansive 19,000 square foot mansion-like home that sits on 300 acres dedicated to all things wine; 27 acres are under vine.
A separate production facility covers 28,000 square feet, producing 4,500 cases annually. It’s best to suspend any previous ideas of what a typical Virginia winery looks like when visiting Early Mountain. The place is huge.
What further separates the winery from the rest of the state’s industry is wines from across Virginia are served in addition to its own lineup. Swing by Early Mountain and they’ll include “visits” to other top producers. It’s more than just a twofer; up to a dozen other wines from top producers are available daily.
“Quality has increased in Virginia. It’s been dramatic. We wanted to find a way to make a contribution to Virginia wine,” said Kostelnik. “We are constantly scouring the state looking for wines we feel are the best representations of Virginia; unique wines, wines of place.
“That’s why we are serving wines in flights. A flight allows you to compare and contrast and integrate some cheese and charcuterie and see how they interact together,” explains Kostelnik.
Of course, if you already know what you want, it’s available by the glass or bottle.
The vision of an over-the-top winery showcasing the state’s industry belongs to Steve and Jean Case. Steve Case was founder of AOL and today is chairman and CEO of Revolution, a Washington, D.C. based investment firm.
His wife Jean has taken the lead in turning the winery vision into reality. The Cases were impressed with Virginia’s wine ascent and had an opportunity to purchase the former Sweeley Estate Winery in 2011. After a six month renovation, the facility opened as Early Mountain in 2012.
More than wine
In keeping with its theme to entertain, the winery hosts live music Fridays, Saturdays and Sundays. “Friday evenings the tasting room is absolutely full,” says Kostelnik, which speaks to the success of creating a club-like atmosphere for both locals and out-of-towners.
A consulting chef from DC, Jenn Crovato, oversees the kitchen menu that serves soups, sandwiches and similar light fare.
Other Virginia made products are also available including ham, charcuterie and artisan cheeses; products that go nicely with a glass of wine.
The facility includes a large main hall for special events and weddings. Over forty weddings a year are hosted at the winery and include the use of a cottage on the property, primarily for use by the bride in getting ready for the ceremony. It’s also where the Cases stay when visiting and is available for rental for romantic getaways.
With the summer months upon us, there is a patio that seats forty and a terrace area with picnic tables and picturesque views of the vineyards. “The goal is to allow you to come out, relax, enjoy the scenery, have something to eat, bring the kids and dog, and appreciate the wine,” says Kostelnik.
Early Mountain Vineyards is open six days a week and closed on Tuesdays. For information on upcoming events visit: http://earlymountain.com/
John’s Pick of the Month
“For The Love Of Whites” wine flight
Rather than select a single bottling this month, you be the expert and evaluate the white flight selections and make the call yourself. The flight includes a sparkler, a Sauvignon Blanc, a Chardonnay and a white blend.
The flight concept allows you to engage in the “compare and contrast” fun of wine evaluation. After you’ve picked a favorite—and they’re all good—your purchase decision will have been made. Cheers!
Published in the July 24, 2014 edition of the Culpeper Times.
Bealeton firm emphasizes “feel good” performance
“I’m a people person. Home remodeling and restoration demands close interface with your clients and I enjoy that. You become part of a client’s life when you take on a project. In this business a couple’s home comes in second only behind their family.”
While that’s not a mission statement, it could pass for one coming from Tom Wotton, who along with his wife Dawn, are owners of Home Sweet Home Improvements. “We develop a personal relationship with each client. We are not just a builder or contractor,” said Wotton.
Founded in 1991, the custom remodeling and restoration firm has steadily grown in good times and bad. Today, the firm averages 25 projects a year, ranging in cost from several hundred dollars for a simple design fee up to a $2 million dollar restoration effort.
The company focuses on construction management, additions, whole home remodels and historic renovations throughout the Northern Piedmont area. Typical of most businesses in the last seven years, the recession has had its impact. “We see a ‘pumping’ effect in the industry. At times business surges and then it drops off.”
While the recession officially ended in June, 2009 that has not been the Wottons experience. “The recession hit us really hard but 2008 was one of our best years; by 2010 business had dropped by 50 percent. Today, we are back to where we were 15 years ago,” said Wotton explaining the slowly improving economic conditions.
An important benchmark for projecting industry trends is Harvard’s Leading Indicator of Remodeling Activity, or LIRA. The model is designed to estimate national homeowner spending on improvements for the current and subsequent three quarters.
The LIRA projects a strong growth in 2014, with gains in home improvement spending projected to be in the double digits for the first half of the year and just under 10 percent by the third quarter. Wotton’s firm is well positioned to take advantage of the favorable forecast.
In the beginning
Tom Wotton grew up in a military family and experienced numerous moves as a youth, much of it in Europe. When he was 15, he landed a job as a laborer for a historic restoration project and became fascinated with the construction industry. That early job led to his earning a degree in Construction Management and later obtaining a Class A Contractor License.
He is also a certified Master Plumber and Graduate Remodeler with the National Association of Home Builders. The man has his bona fides.
His early career was spent working for a residential home builder. As is often the case, the builder was not interested in pursuing remodeling work and handed off such projects to the up and coming Wotton.
Twenty-three years ago, he had sufficient remodeling experience and business leads to justify creating his own company. In 2004, his wife Dawn joined the firm bringing her degree in Business Administration and nine years experience as a senior budget analyst for a U.S. Government contractor to bear on the company’s success.
Dawn Wotton serves as the firm’s Office and Business Manager and oversees marketing, payroll, bookkeeping and finances. The firm has five full-time employees.
As the company’s business grew, the essence of what they wanted to provide to clients crystallized. Today, it’s embodied in the “feel good” relationship they seek to establish with every customer.
“When we chose the name of the firm, we did not want to use the word ‘contractor’ or ‘builder’ because we felt we were more than that. We wanted our projects to make a customer feel good. We work harder at that than we do pounding nails, cleaning up and providing safety on the job,” says Wotton.
He shares a story that embodies his firm’s vision: “Recently, we received a phone call from a former client from a year ago. She said she was sitting in her kitchen and wanted us to know, ‘She still loved it!’ and that she missed our crew and wanted to know how everyone was doing. That’s the kind of experience we want to create for every customer.
“It was also a feel good moment for us,” said Wotton smiling.
To reinforce the success they have achieved, a visit to the firm’s website is revealing. Under the testimonial link are several comments on past projects:
“Your work at Boxwood Winery over the past few years has always been excellent. You are knowledgeable, prompt and always reasonable in your charges. We have never been disappointed and will rely on you in the future.” J.K. Cooke (Middleburg)
“Excellent! I felt that you guys care about all of your projects. You are prompt to answer/return calls and deal with any issues that arise. I have never seen such care taken to where the nails were placed in the trim. It was very nice to work with you all.” Shana S. (Warrenton)
“Polite, qualified workers, willing to listen, change, and come up with ideas to have a great outcome! Thank you for taking so much time to help me work through so many ideas and red tape. It was so worth the wait, what a beautiful job!” L. Jones (Marshall)
“Very good! The employees of HSH are exceptionally nice to work with. There was never any question that you cared about us and our project. There is a sense that this house was built with loving hands!” Cammie F. (Jeffersonton)
When former customers freely share their experiences about job performance, it employs the most traditional way of building new business.
While a valued reputation and word of mouth advertising are proven ways to build revenues, it often is not sufficient to advance growth. The Wottons generate about 60 percent of their business from repeat customers and referrals. To augment that trade they have undertaken other strategies.
One technique is seminars. Tom Wotton has held two of these in the past year and plans to continue the practice. He assembled six cabinet companies to sponsor the presentations that are held at a vendor’s office. Potential customers are registered for the seminar and Wotton covers the ins and outs of kitchen and bathroom remodeling, both from a do-it-yourself perspective to hiring a professional.
Another promising avenue for lead generation is the website “Houzz”. Houzz is a clever child of the digital age. It provides people with information they need to improve their homes; from decorating a room to building a McMansion.
The site offers builders the opportunity to upload photos of their work and showcase past projects to potential new buyers. “We posted photos of two of our projects and use the site to create ideas for prospects before we meet with them. It’s also a good sales tool. We recently had 800 views within a week,” says Wotton.
Print advertising rounds out their marketing efforts.
In discussing the scope and timeframes for completing specific jobs, Wotton emphasizes he doesn’t use high pressure sale pitches. “”It’s their home and it’s done their way.” Projects are often segmented into the three stages: material selection, purchase of supplies and final installation. “We must be flexible. Typically projects last from three weeks to several months, depending on the scope of the work to be done.”
One interesting segment of the business is people who have recently purchased a new home but want to make changes or additions. “Buyers tell us they were only able to get so many options with their new home and want to further customize it. That’s where our conversation with them begins,” says Wotton.
Historical renovations and restorations take remodeling to another level. Often such projects are tied to a family’s needs. The projects can be sensitive since older homes embody memories of times and people from yesteryear. The Piedmont area has a substantial number of these homes given its rich history dating to the founding of the country. “Family ties to the past and nostalgia are important considerations when undertaking such projects,” said Wotton.
A critical marker of success for Home Sweet Home Improvements is the cadre of trade partners it has developed. “Our partners are important and have been with us a long time. Our plumbers, electricians, designers, architects, and material suppliers share our culture.
“All of us want to provide a project that is on time and on budget and deliver a safe, clean, worry-free home investment. At the end of the day we want it to be a good experience for our customers,” emphasizes Wotton.
In the age of mass production, it’s reassuring to know homeowners in the Piedmont region have a local firm that is committed to providing hand-crafted home remodeling in the best sense of the tradition.
For a full description of the firm’s services, estimates, financing and more visit http://www.homesweethomeimprovements.com/
Published in the 2014 Summer edition of the Piedmont Business Journal.
Experienced vintner returns to making magic with fermented grapes
Andy Reagan, multiple gold medal winner, is again crafting Virginia wines since his departure from Jefferson Vineyards in December 2012.
Reagan chose two avenues for his reappearance on the Old Dominion winemaking scene. First, he joined forces with Mike Shapiro, a budding venture capitalist, to produce a new line of wines. He’s also been given the keys to the cellar of a small but respected Virginia winery.
During his hiatus, Reagan collaborated with Mike Shapiro to create Roundabout Cellars. Given the entry level costs of a million dollars or more to start a winery, the two entrepreneurs took a “round about” way of producing quality wine at an affordable price without cashing in their 401(k)s.
“I always had a passion for wine and when I learned Andy was looking for opportunities, I thought it was a way to try a new approach to selling wine,” said Shapiro. The wines are only available online since there is no brick and mortar winery.
It’s reality wine retailed from a virtual tasting room.
Reagan, well connected in the industry, arranged for the purchase of finished wines from a few top Virginia wineries. He then utilized cellar space at an established winery and employed his blending skills to create five different cuveés.
Lest one thinks blending is a minor part of winemaking, Google Michel Rolland and learn how the French “Flying Winemaker” gained international fame by consulting to wineries worldwide. He achieved much of his success by employing his educated palate to taste and then blend wines of exceptional character.
Both Rolland and Reagan believe blending embodies the old chestnut that “the sum is greater than the individual parts”.
To confirm the quality of Reagan’s wines, the 2013 Governor’s Cup awarded three silvers to his first vintage and the Virginia Wine Of The Month Club snatched up 150 cases for its December 2013 selection.
Oenophiles interested in tasting the product of a talented winemaker need only visit www.roundaboutcellars.com and keystroke their way to a purchase.
With over twenty years experience as a winemaker—yes, he started in his teens—Reagan was soon off on another project. After working on his Roundabout Cellars brand, he found himself creating wines at a conventional winery.
Old House Vineyards in Culpeper is where Reagan is now nurturing some ten different varietals. The winery is sited on an old alfalfa farm and draws wine tasters to its bucolic setting graced by a small lake, pavilion and wood burning pizza oven situated on a large stone patio.
The winery’s newest claim will be wines crafted by a top vintner with his best years ahead of him.
In June, the Laurel Mills Store in Castleton reopened its doors after a four month hiatus between ownerships. Local residents couldn’t be happier.
The new owners, Pete and Brenda MacMurray, are familiar with the Piedmont region having renovated and reinvigorated the Orlean Market in Fauquier County in 2008. The serial entrepreneurs are pleased to be back in Virginia after operating a B&B and gift shop in New Bern, N.C. for the last three years.
Pete McMurray is a creative businessman with a host of successful companies on his resume’. Among his more unique ventures was the development of one of the first eCommerce businesses in the country, called PC Flowers. Created in 1989, the business sold flowers nationwide via the embryonic Internet.
Later, he shifted gears and purchased and operated a major marina located near the Outer Banks in North Carolina. His early career involved stints with IBM and Boeing Computer Services. His wife, Brenda, operated a grocery store in Manassas in the 1990s.
The energetic couple has breathed life back into the historical village store that was built in 1877. An old woolen mill next to the store manufactured confederate uniforms during the Civil War.
The MacMurrays restored the pine flooring and exposed the original brick walls to showcase goods typically found in a small grocery store. And more.
By the end of July, wine—both Virginia and international—and several craft and popular beers will be featured along with fresh sandwiches, soups and salads.
Former longtime co-owner of the store, Mary Frances Fannon, says, “I am thrilled to death to have the store back in operation.”
As are a host of unique customers.
“All the kids from Castleton Festival come in. They are really, really nice kids; musicians, singers, costume designers, and more. Who would have thought we’d have an internationally acclaimed music festival in Rappahannock County? We have people from all over the world come in the store now,” says Pete MacMurray.
And that includes local residents, many who have enjoyed successful careers elsewhere and seek the beauty and quiet of Rappahannock County as counterpoint to their busy lives.
One such legendary cohort is the “Sunday Morning Front Porch Group” that has been meeting for years at the store for coffee, pastries and banter. If one was to stumble onto this crowd, they’d be chatting with consultants, political figures, high-priced lawyers, former CEOs, and judges just to mention a few of the diverse occupations.
Long time Front Porch member Richard Viguerie says, “The Laurel Mills Store has changed but it hasn’t. You’ll find the same warm smile and friendly greeting from Brenda and Pete that we’ve grown accustomed to over the years from Mary Frances Fannon, then Marion Sharp.”
Viguerie explains that as one walks onto the front porch and up to the heavy wooden door, it looks like the mom and pop store he’s known for decades. “But when you step inside—wow—you feel as if you’ve been transported to a charming boutique shop in Greenwich Village.
“Brenda and Pete have clearly made a long term commitment to our part of beautiful Rappahannock County. I, and the other front porch regulars, welcome and thank them.”
Brenda MacMurray is doubly pleased to be co-managing the store since she is again able to visit nearby family members.
The Laurel Mills Store is opened seven days a week in the summer from 7 a.m. to 9 p.m.; Sundays 8 to 5 p.m.
But locals know that if an item is needed during off-hours they can, “Simply knock on the front door and we’ll let them in since we live on the second floor,” says a smiling Pete MacMurray.
Rappahannock hospitality continues in fine form with the rebirth of the Laurel Mills Store.
Published in the July 10, 2014 edition of the Rappahannock News.
The new owner of The Grapevine wine shop in Warrenton is Dan Kutruff, a wine professional who has turned a passion into a gift for Fauquier County wine lovers.
The enthusiastic entrepreneur has pulled corks at a number of venues including Wegmans in Gainesville, accumulating a wealth of expertise that is satisfying lovers of the fermented grape.
Wine selections range from $6.99 for an everyday sipper to $250 for a world-class champagne. However, value wines are spotlighted. “Since taking over the shop, I’ve increased our selections of wines under $15 by forty percent,” says Kutruff.
A diverse selection of wines that’s easy on the wallet? Nice.
So does Fauquier County have a defined wine profile? Not at all says Kutruff, “Diversity is how I would describe our customers’ wine preferences. That’s what makes the job so much fun. I have a penchant for trying to cater to different palates. We don’t sell things just because. We want to make our customers happy.”
As proof that the shop supports the local wine culture, Kutruff says, “I’ve increase our Virginia wine business considerably since we’ve moved in.”
In addition to wines, the shop is also a cigar retailer. Its walk-in humidor with a wide selection of cigars is maintained at a steady 72 percent humidity. And it smells great in there too!
Rounding out the shop’s inventory are ninety different craft beers, ciders and meads.
With summer fast approaching in the Piedmont, The Grapevine is focusing on the quintessential warm weather wine: Rosé.
“Our next big summer excitement is dry rosés. I’ve ordered rosés from all over the world…Spain, France, Washington State, California, South Africa, and Italy, just to name a few,” says Kutruff.
So what draws a person to open a wine shop? No complicated head game answer here: “This is what I was meant to do,” says a smiling Kutruff.
Wine lovers, man your corkscrews!
389 W. Shirley Ave.
Warrenton, VA 20186
New ownership with expanded selections
Lets’ do the numbers
575 wines…250 new picks since opening
120 cigar selections from the world’s top producers
90 different craft beers
Local cheeses and honey
Custom gift baskets
Free wine tastings on Saturdays
Monday – Thursday 11 a.m. – 7 p.m.
Friday – Saturday 10 a.m. – 7 p.m.
Published in the summer 2014 edition of inFauquier magazine.
Carter family produced first successful Vitis Vinifera wine in Virginia
Over two hundred and fifty years ago, the ancestors of the owner of Philip Carter Winery of Virginia were recognized by both the London society and Virginia’s Royal Governor Francis Fauquier as having made quality wine from the tasty, but notoriously difficult to grow, European grape.
Charles and Landon Carter were awarded a gold medal and kudos for their “spirited attempt towards the accomplishment of their views, respecting wine in America.”
Today, that legacy is being carried forward at the Fauquier County winery under the guidance of the proprietor and Richmond lawyer Philip Carter Strother.
“My family goes back to the formation of Fauquier County in the mid-1600s. Owning a winery was solidified in my mind when I was in law school. It was a way to ultimately preserve our family farm for generations into the future,” says Strother.
It’s also a way to provide wine lovers a beautiful setting in which to enjoy a selection of fine wines seven days a week; a win-win strategy for success.
Strother’s love of the land and his family’s history led to a successful legal practice in environmental law and land use development. As part of that practice, he has been representing farm wineries for almost fifteen years and was instrumental in passage of the Farm Wineries Zoning Act in 2007.
“The law deregulated the wine industry as it related to local government regulations and removed the ability of localities to regulate, to a large extent, the wine industry,” he says.
“I believe it’s the single most important piece of legislation passed since the original Farm Winery Act.” A supportive legal environment has been critical to the success of an industry that today boasts over 260 wineries in the Commonwealth.
Vines & wines
In 2006, an existing 26 acre Fauquier County winery came on the market and Strother quickly purchased it. His family had owned farming property in the county for over three hundred and sixty years and the barrister wanted to continue the agricultural tradition.
The property had the added benefit of being “located one parcel over from the Strother family grave site” further tying the land to his family’s history. “I purchased the property because it was a turnkey operation that allowed me to continue practicing law,” says Strother.
Before taking possession of the property, Strother would travel almost daily from Richmond to the winery to learn first hand about vineyard and cellar production techniques. It was on-the-job training for the city lawyer that enhanced his understanding of where he wanted to take his new venture.
“The farm had eight acres of vineyards and today we have sixteen under vine. We produced 500 cases our first year and are now making about 4,000. Ninety-nine percent of our resources have gone into the wine production side of the business,” Strother emphasizes.
The key to creating fine wine is giving the keys to the cellar to a talented winemaker. “We believe Jeremy Ligon is a rising star in the Virginia wine industry. Jeremy is a native Virginian whose parents own a vineyard in southwest Virginia. He has been working in vineyards since he was a teenager.”
Ligon also has his wine bona fides, holding degrees in viniculture and enology from California State University, Fresno, one of the nation’s most prestigious wine programs.
“We are really trying to complement what others are doing in the industry. We want to elevate the quality of Virginia wine,” states Strother.
Typically, the winery features eight wines for tasting, including Chardonnay, Vidal Blanc, Cabernet Franc, Cabernet Sauvignon and a red blend. The tasting room sits on a slight rise overlooking rolling vineyards with mountains views framing the scene.
To sip wine in this bucolic setting is to appreciate Strother’s “passion and dedication to producing premium wines.”
For more information on the winery’s hours and events visit http://www.pcwinery.com/
John’s Pick of the Month
Philip Carter Winery
Fittingly, this Bordeaux-styled red blend was named after the 17th century plantation located on the Rappahannock River that was home to Robert Carter, a colonial Governor of Virginia and one of the wealthiest men in the British colonies in North America.
The wine is a blend of Cabernet Sauvignon, Cabernet Franc, Merlot and Petit Verdot. It has fruit forward aromas of black cherry and plum and coats the palate with a soft lingering richness typical of a left bank Bordeaux wine. Pair with any quality cut of filet mignon or prime rib.
Published in the June 5, 2014 edition of the Culpeper Times.
Local legend dedicated to improving lives
Since 1990, clinical psychologist Dr. Robert B. Iadeluca has seen thousands of patients seeking solutions to life’s vexing problems. His career spans over seven decades across a number of fields. Today, at the age of 93, he still sees as many as ten patients a day in his Warrenton office.
The man embodies Shakespeake’s “seven ages of man” but with a notable exception: He has never advanced to the final two ages but serves at the Justice level, where he has acquired wisdom through life experiences.
Wisdom used in the service to others.
But who is this man who is recognized daily by residents as he moves purposefully about town working as hard as ever? And how does he do it?
A storied life
Iadeluca was born in 1920 and his mother died when he was nine years old. Those limited early years with her were formative. “She was a strong guiding light; very encouraging to me in everything. I could read at the age of two-and-a-half and was playing the violin at age seven, and the trumpet at age nine on local radio shows.
“When I was 5 years old she took me to the library to get a library card,” he recalls. When the librarian declined to issue him one until he could read, his mother told him to pull any book off a nearby shelf. He did and read the first paragraph aloud. He got his card.
The story is emblematic of the “can do” attitude the good doctor would exhibit throughout his life. Upon his Mother’s death he was largely responsible for running the household since his father was a disabled World War I veteran. “Her early training enabled me to carry on when she was gone,” he states.
His father was a practical man and expected him to achieve whatever his goals were. “Among the many things he taught me was Morse code since he had served in the Signal Corps during the war.” The recollections of life with his parents drives home a truism that Iadeluca firmly believes in; early childhood experiences shape people—for better or worst—for the rest of their lives.
As a young man he did not attend college since graduation from high school was viewed as a good start in those days. After serving in some odds jobs he secured a position with an advertising agency in New York City starting as a delivery boy. His innate intelligence and drive soon brought him to the cusp of a promotion to account executive. Then, Japan bombed Pearl Harbor and his life took a new direction.
The war years
“When news of the bombing hit, my reaction was the same as everybody else’s; ‘Where’s Pearl Harbor?’ Nobody had ever heard of it.”
Not waiting to be drafted, the future doctor enlisted in the Army. In talking about his life experiences he frequently cites the month and day an event occurred. Total recall might be pushing it but the man’s memory is impressive. “I clearly remember being sworn into the Army, raising my right hand and taking the pledge. It was June 10, 1942.”
Soon after his induction, his intelligence was again quickly recognized and he was promoted to First Sergeant, the heart and soul of military rank. He was twenty-one years old.
After serving stateside helping a team create the 100th Division, at his request, he was sent overseas. He landed in England and was assigned to the 29th Division—the unit that landed at Normandy—and fought with the 29th in France, Belgium, Holland and finally, Germany.
“To repeat an often used description about combat, it was 90 percent boredom and 10 percent terror,” he says. It also bestowed on him membership in the historically important cohort called “The Greatest Generation”.
As part of his overseas experiences, he met a beautiful French girl. The couple stayed in touch after the war and subsequently married stateside when he realized “she was the one.” They had two sons, one who is still living. She has since died.
Following his military experience, he accepted a position as a career scout executive with the Boy Scouts of America. He held the position for thirteen years at offices in New York State, New Jersey, Long Island and New York City.
Seeking new challenges, he left his scouting job and became the assistant public relations director with the New York State Department of Education. Within two years, a severe recession led to his loss of the position.
Seeing unemployment as an opportunity—and in concert with his lifelong search for knowledge—at age 52, Iadeluca went back to school and received a PhD in Life Span Developmental Psychology. It took seven years to secure the degree and a few years later he went to work as a research psychologist with the Federal Government.
“When I joined the federal workforce I was sixty years old. Most government workers were retiring by then,” he says. It was also when he moved to Warrenton and for ten years commuted to D.C.
It was a valuable decade of professional experience. He worked at the Army Research Institute on issues involving military families and substance abuse. The expertise he gained would later be brought to bear in his Warrenton practice.
At the age 70, he succumbed to the lure of retirement but quickly realized he was bored. He knew a physiatrist at the University of Virginia. “I contacted him and asked if he’d be interested in having an intern at no charge. He said ‘great!’ so I began commuting to Charlottesville five days a week for a year and a half. I learned even more about substance abuse during the internship.”
In 1990, Iadeluca opened his office on Hospital Hill and began seeing patients daily. Seven years ago he began writing for the The Warrenton Lifestyle magazine. Each month he pens an article on some aspect of mental health and well being.
“It’s almost impossible for a day to go by without somebody stopping me on the street or in the grocery store and commenting on one of the articles. Often they have never met me and only recognize me from my photograph.”
The articles are incisively written and provide advice on emotional issues facing the average person. They are, in fact, a direct extension of his work and an opportunity to sit down with the doctor without making an appointment.
And what are the central issues he hears in his practice? “One of the things I encounter often is the failure of people to communicate with each other. Be it either in a family or employment situation. People do not listen or they assume others know what is going on with them. Frequently, I see patients who are not opening up to the other person.
“I also see substance abuse issues in about fifty percent of my patients. My doctorate centered on the study of the human brain from conception to death,” he says. To that end this past winter he held a seminar for parents that focused on keeping children from becoming addicted to drugs by taking preventive measures in their early childhood.
So does he see retirement in his future? “The interaction with my patients is what keeps me alive,” he says emphatically and he has no plans to take down his shingle.
“I’m not here because I’m healthy. I’m healthy because I’m here.
“There is most definitely an epidemic of substance abuse in Fauquier County,” says Dr. Iadeluca. “And there is a denial by the general public that the problem exists. But if you talk with law enforcement and social services personnel, they’ll agree.”
Strong words from the psychologist who estimates more than fifty percent of his patients suffer from some form of substance abuse. “People say ‘Yes, I hear about the problem but it’s not in my family, it’s not my child’ but often it is. Over fifty percent of my patients suffer from substance abuse and twenty percent are teenagers.”
The 2012 National Survey on Drug Use and Health report estimated 23.9 million Americans aged 12 or older were current illicit drug users, reinforcing Iadeluca’s observations.
Prescription drug abuse is a national epidemic, according to the Centers for Disease Control. Overdose rates in the United States have more than tripled since 1990. Most abusers get the pills from a friend or family member who had the initial prescription.
The doctor says school administrators, teachers and parents need to learn more about the subject and be alert to warning signs of abuse among young people. Such signs can include loss of interest in family activities, disrespect for family rules, withdrawal from responsibilities, being verbally or physically abusive and taking valuable items or money from the home.
Iadeluca says the human brain does not become fully developed until age twenty-five, making young people particularly susceptible to abuse issues. “They simply don’t have the strength to inhibit such behavior, especially if they have been traumatized in early childhood.”
Dr. Iadeluca says…
What drives a nonagenarian to still work 40 hours a week? Is there a secret to a long and active life or is it just plain luck?
Here are a few observations from the good doctor’s philosophy. You decide.
Responsibility builds knowledge: “When I was a youngster and asked my mother a question, she always said, ‘Look it up!’ And I did.”
Health is paramount: “When I was studying for my doctorate I read research that said not eating red meat leads to a longer life. So in my late fifties, I decided not to eat meat and gradually tapered off. I’m not a Vegan. I just don’t eat red meat.”
Don’t retire: “Last year I considered retiring. I thought maybe I was ready. But I went shopping that day and engaged two or three people in conversation. It re-energized me and I realized I had to maintain my practice to stay healthy.”
Express gratitude: “I’ve had a good life but the last twenty years has been the happiest. When I get up in the morning I look forward to going to work.”
An abridged version of this article appeared in the 2014 summer 2014 edition of inFauquier magazine.
The Spring 2014 edition of the Piedmont Business Journal highlighted the role of print advertising in today’s business environment. It’s conclusion was that print—as opposed to conventional wisdom—is alive and well. The following are three pieces I contributed to the magazine.
Dr. Lawrence J. Finkel Dermatology
In 2002, Dr. Lawrence J. Finkel opened his medical practice in Warrenton. Since then, he has seen almost 45,000 patients. To paraphrase the moniker of the late recording artist James Brown, the doctor is the hardest working man in dermatology.
His office is located at 360 Church St. and “sees patients from infants to the elderly”, providing medical, surgical, pediatric and cosmetic services.
“The best advertising, far and away, is word of mouth. It’s very gratifying when people come in who were referred by neighbors and friends,” says Finkel. “As a result, we continue to grow. Some days we see 15 to 20 new patients. That’s good for growth.”
An adjunct to word of mouth advertising is the collateral benefits of providing a good office experience. His phone service, reception room, attentive nurses, and prompt check outs all factor into satisfied patients who return again and again.
Indeed, the hallmark of an office visit is the friendly greeting from the reception desk followed by “the doctor will see you shortly.” Long waits don’t happen on Finkel’s watch.
Central to the practice’s growth is that he accepts most insurance plans. There is a shortage of dermatologists who do. Except for the 20 percent of his practice that is cosmetic services—which is cash based—the business primarily involves insurance billing.
Notwithstanding the success of providing a professional experience in building a medical practice, paid advertising plays a role. “It’s important to advertise. We are listed on all the insurance carrier websites that we are affiliated with. Many of our patients come here because they go to their carrier’s website and see I am someone who takes their insurance,” explains Finkel.
Print advertising focuses on magazines and newspapers. “We advertise in ten to twelve publications, including homeowner newsletters. We also place ads in one time event publications such as concert and football programs. Print is the most expensive form of advertising we do and I say no to lots of print ad requests.”
When print is chosen, one criteria considered is the shelf life of the publication. If a magazine is published on a monthly or quarterly basis, it increases the amount of time it may sit on coffee tables or in reception rooms multiplying the number of impressions the ad scores over time.
A particularly useful application of print advertising is when the practice purchases a new piece of medical equipment. “We need to market any new devices since patients do not know about them,” states Finkel.
Yellow Page placements are used to draw older patients who may not have access to the internet. Conversely, online search engine optimization is continually updated with key words to stimulate business from younger patients who live in the digital world. “We get twenty-five percent of our new patients from website searches.”
Social media is limited to Facebook and is primarily directed toward building the cosmetic side of the business, called MedSpa 360. Electronic ads include a once a month email newsletter highlighting cosmetic specials. Conventional direct mail rounds out the media budget but is used on a limited basis.
One future possibility for internet advertising is the use of smartphone promotions. Finkel knows today’s teenagers rely on devices to manage their lives and sees that placing pop-up and banner advertising on them could reap dividends. “They’re on their phones all day,” he correctly observes.
One final form of no cost advertising is the fact that the doctor lives in the Warrenton area. “Because I live and work in the community, it provides a good source of advertising. My kids are in the local school system. People may see me in the grocery store and elsewhere and say, ’Oh, I need to come and see you’. I get patient visits because I don’t live an hour away but am in the community daily.”
The good doctor closes with the observation, “I hope to practice for a long time. At some point I may cut back but have no imminent plans to retire.”
It sounds like the industrious Dr. Finkel may double his patient files over the second decade of his practice. Better make that appointment today.
Stonewall Golf Club at Lake Manassas
“Advertising is very important to the club,” says Jeanna Hilton, director of sales and marketing, at the Stonewall Golf Club at Lake Manassas.
It’s important because it pays. But it must be targeted to score the type of business the club seeks
At Stonewall, a total of $50,000 a year is spent helping to generate revenues of over a million dollars. The ad budget is down from a high of $75 thousand annually when the club first opened in 2001. Back then, the money was apportioned across the three segments of the business: the golf course, the restaurant, and special events.
Today, the golf business receives only a minimal amount of ad dollars because the reputation for a quality golfing experience has been established and precludes the need to extensively promote it. The number of new and repeat golfers keeps the tee time sheet full.
“We used to do local radio and TV advertising to promote the golf side of the business. We no longer find that necessary,” says Hilton.
Not so the case with trade shows, weddings and banquets. “We host an annual bridal showcase each year. I charge the thirty participating vendors $300 each to set up a table. That’s money they need to recoup in sales and they expect to see brides at the show.
“And they do, some forty to fifty brides have been at each showcase,” Hilton says. As a result, the vendors know their investment pays off and they return each year.
“Fifty percent of our overall ad budget goes into print; specifically local magazine and newspapers. $6 thousand of that amount is dedicated to the bridal show alone.” The strategy reinforces the fact successful advertising needs be targeted to reap the expected dividends.
Other revenue streams come from the fifty weddings the club hosts annually, private parties, bridal showers and restaurant dinners; both for groups and public dining.
“We also advertise in a local wedding magazine. The editor has a great website and blog so we advertise with her and get the benefit of her website and email blasts.”
Another reason for advertising special events is that many customers who have only been to the restaurant once are often unaware the club hosts group affairs.
The digital world plays an increasing important role at Stonewall. “We have a twenty thousand email database and send out an online newsletter twice a month. It promotes everything the club offers, from golf tournaments to special dining events.
Rounding out the media tool kit is the popular Money Mailer direct mail program. The co-op mailer is a hyper-local approach to direct mail using coupons and individual ad inserts. It is delivered to eighteen thousand homes and has proven its return on investment over the years.
In addition to conventional advertising, the club is a member of both the Prince William and Fauquier Chambers of Commerce. Hilton regularly attends chamber meetings. She also belongs to business networking organizations, including a wedding network group that she created five years ago.
Networking is a lower cost way to build awareness of the Stonewall Club and promote its event schedule. “That’s a huge part of how I do business,” Hilton emphasizes.
In partly describing her role at the club the energetic Hilton says, “I decide what media to use, including social media such as Facebook. I love my job and like interacting with the community.”
The financial performance of the Stonewall Club confirms her success in managing the company’s advertising budget. __________________________________________________________________________________________________________________
Moving business forward with reverse mortgages
Andreas Keller may be a reverse mortgage specialist, but to bring home the bacon networking is his forte. “The best advertising for me is networking. My experience with print advertising has not been as good,” says Keller.
His observation underscores that a business person needs to know both his product and potential clients before creating a successful media budget. It’s a lesson typically learned through experience.
Reverse mortgages are increasing in popularity with seniors who have equity in their homes and may want—or often need—to supplement their income. Participating homeowners normally defer payment of the loan until they die, sell or move out of the home.
Given the rocky economic landscape many older citizens have been moving across over the last decade, increasing cash flow through their declining years can enhance peace of mind.
Keller works for Southern Trust Mortgage in Warrenton. The firm does not provide advertising dollars to generate reverse mortgage business. Promotional efforts are out-of-pocket expenses of the broker. Finding the best avenue to the settlement table at the least cost is paramount when your own wallet is in play.
But lead generation absent splashy print ads and colorful direct mail means work. “Networking is the number one way I generate business”. He devotes a lot of hours to “giving presentations to senior groups, civic clubs, churches, financial advisors, wealth counselors, realtors, insurance agents, attorneys and more.”
And yes, Keller is an articulate and enthusiastic person so networking perfectly fits his personality.
There is, however, one advertising technique that reaps fruit and doesn’t cost Keller a cent. Since reverse mortgages have gained the attention of major lenders, many use national TV and print advertising. Often people come to him because of an initial interest created by a national campaign.
“I always ask people how they got referred to me, how did they find me. One of the frequent ways is they have read one of my articles or heard my presentation and wanted to learn more.
“But, I also have people say they’ve responded to a national TV or print ad and either got a pressured sales pitch or didn’t like the company’s responses to their questions. So they wanted to talk to me. I don’t use pressure. I am an educator,” says Keller.
That might be dubbed lead generation by “drafting”. But if it places a NASCAR driver in the winner’s circle, it’s a sound strategy for Keller.
The second successful promotional effort is social media, specifically, one called Constant Contact. The marketing website permits users to communicate with current and future customers.
“Whenever I do a presentation or make contact with a potential client, I ask them if I can add them to my email address list. It’s not spam. I get their permission. Then every four to six weeks, I send out information and updates on reverse mortgages. I’m getting a lot of good comments from the use of Constant Contact. It costs $35 a month,” Keller says.
As a further on to social media, Keller employs a panoply of sites including, Facebook, Linkedin, Twitter, and Goggle Plus. “They all generate leads.”
And finally, print ads are not totally ignored. “I spend about $5,000 a year on magazine advertising, including the Guide to Retirement Living Source Book. I submit articles for publication in the magazines. It’s not the ads alone generating business. It’s the ads along with my articles,” emphasizes Keller.
So how does the hard working mortgage specialist relax? He is a member of the Warrenton hiking club called Boots ‘n Beer. “Our motto is a drinking club with a hiking problem!”
Two to three times a month you can find him leading hikes in the Piedmont region followed by a burger and brew at a local pub. Keller is a reverse mortgage specialist with his boots firmly planted in the mountains.
Big reds lead the way at Markham winery
When Howard O’Brien sees red he’s not angry. He’s simply looking at a glass of one of his red wines. And the more intense the color and flavor, the more relaxed the man becomes.
O’Brien is the loquacious proprietor of Chateau O’Brien at Northpoint. The man loves to chat; especially about his wines. And when you focus on the product in the glass you understand why his mantra is quality, quality, and quality.
Like numerous Virginia winery owners, O’Brien entered the wine industry after a successful but unrelated career. In his case, it was circling the globe building his international trade show business. “Because of my work, I traveled 200,000 miles a year for twenty years. My clients included the UN, NATO, NASA, and the Pentagon among other large organizations. Now I want to live a simpler life,” he says.
A simple life centered on complex wines. During his former whirling dervish career, O’Brien found ample opportunity to visit wineries worldwide and began collecting wine thirty years ago. Today, his personal wine cellar contains 3,000 bottles of some pricey wines. “I have no bottle less that $100 in my collection.”
Thirteen years ago he sold his trade show firm and opened Chateau O’Brien. While he has homes in Northern Virginia, the Outer Banks, and Florida, most weekends find him living and working at the winery.
To further his wine knowledge he is currently studying to become a Master of Wine. The Institute of Masters of Wine is headquartered in England and is regarded as one of the highest standards of professional wine knowledge. Certification requires passing multiple written and tasting exams and completion of a 10,000 word dissertation. To put the title in perspective there are only thirty-four Masters of Wine in the United States today.
“I anticipate in three months I’ll be done. I am a sponge for knowledge,” says O’Brien explaining why he chose to pursue the most rigorous wine accreditation in the world.
The winery & wines
O’Brien credits his staff with playing an important role in the success of his winery.
“Staff training is an ongoing thing. They are involved is all aspects of the operation from the vineyard to the bottling line. My tasting room staff are educated people; lawyers, doctors, school teachers. It’s not for the money. They enjoy it and I want to give kudos to them,” he says.
His vineyard manager and winemaker is Jason Murray who has been with O’Brien from the beginning. “Before coming here Jason worked with the Virginia state extension office and Tony Wolf, who is Professor of viniculture with Virginia Tech. Jason has a Master in Horticulture and is certified in some forms of biodynamic and organic grape growing.
“You make ninety percent of your wine in the dirt,” says O’Brien underscoring the importance of having an experienced professional tending the vines. “A winemaker cannot create quality. If you are growing your own grapes, the fruit is the most important part of your operation.”
A somewhat controversial aspect of Chateau O’Brien is the signage you encounter as you approach the winery: “No person under twenty-one allowed on property.” The policy rankles some visitors.
“We want our guests to concentrate on the wines when they come here. I got tired of telling people not to let their kids run around and scream. I’m not their babysitter. My best customers don’t want to see kids in the winery. Ultimately, a winery really doesn’t have anything for kids to do,” explains O’Brien.
Today, the Chateau is in the process of converting more of its vineyards to the production of red wines. Chardonnay, Pinot Grigio and Viognier vines are being removed to provide more acreage for the classic red grapes such as Cabernet Sauvignon, Cabernet Franc, Malbec, Petit Verdot and Syrah.
Case production has also declined to 2,200 cases annually as O’Brien seeks to reorder his tasting lineup with more reds. During the growing season fruit is dropped from the vine to intensify flavor. The goal is to harvest only one to three tons per acre. Maximizing tonnage generates more fruit but can lead to weaker, less concentrated wines.
The strategy also increases the cost of a typical bottle. Wines range from $22 to $79. An additional cost factor is that all wines undergo wild yeast fermentation. Such fermentations must be closely monitored to prevent off flavors. Most wineries use commercial yeasts to protect against serious problems in the cellar.
“You are not going to get good in life unless you take a chance. Yes, you have to be on top of fermenting wines with wild yeasts. I don’t know of anybody in the mid-Atlantic region that is doing 100% wild yeast fermentations. It can take over a year to complete the full fermentation process,” states O’Brien.
Critical acclaim is the benchmark in judging fine wines. O’Brien underscores his success by saying Bartholomew Broadbent—who was listed in the 2013 edition of IntoWine as #48 of the 100 Most Influential People in the U.S. wine industry—stopped by the winery last year. After tasting the lineup Broadbent said, “I don’t believe these wines. Every one of the reds are to another level.”
Guests might keep that assessment in mind when ascending the steep driveway to Chateau O’Brien; both the winery and the wines may well lead to the next level of their wine enjoyment.
For information on hours of operation and special events visit http://www.chateauobrien.com/
John’s Pick of the Month
2009 Limited Reserve Tannat
Virginia wines continue their inexorable climb in price and this month’s selection is no exception. But if you are looking for a dense, inky, full-bodied red, redolent of black fruit with a silky finish, this will be your choice. It is a special occasion wine that rivals a top end Napa red. It is simply delicious.
Published in the April 24, 2014 edition of the Culpeper Times.
Grandson joins ranks of fabled fighting force
The United States Marine Corps was created in 1775 and for more than two hundred years has served as the world’s elite fighting force. Marines are First to Fight; warriors in the truest sense. To be a member is an honor earned, not given.
“Every Marine a rifleman” is the axiom that embodies the strength of the Corps. Each Marine learns the basics of being an infantryman regardless of what role they may later assume in the organization.
The training enables Marines to deploy to any location in the world on a 24 hour notice. All troops under a Marine commander are capable of front line combat.
On March 7, our oldest grandson, Preston Scott Hagarty, graduated as private first class from the legendary Parris Island, SC Marine boot camp. Jean and I witnessed the ceremony along with his family, his other grandparents and several of his friends.
All of us could not be more proud of Preston’s achievement.
Recruits receive an intensive 13 weeks of training that is demanding and rigorous. It includes physical conditioning, marksmanship, hand to hand combat—and perhaps most importantly—the ability to operate as a cohesive unit, a team.
During his ten day leave after graduation, I spent some time talking with Preston about his experience. It was instructive to learn why this 18 year old young man chose the Marines and what he has learned in the process.
“What prompted me to join the Corps was doing something most civilians will never do. Not many people can say they’ve served in the Marines. It fits my personality. I’ve always wanted to serve in the military. At first I considered the Army, but I wanted to be the best of the best. It was the challenge,” he explains.
When he arrived at Parris Island, he was a full-fledged civilian and found his first test was taking orders from fierce drill instructors that were never far from his face shouting commands at full voice.
“My worst experience was the first two weeks. You had no idea what you were doing. No idea why you were there. I asked myself, ‘Why did I come here?’ ” he recalls.
For those who knew Preston as a high school student, taking orders was not easy for him. But his transformation at boot camp was swift.
Early on, a drill instructor said to think of the training as an initiation process. “I thought, well that makes sense. It’s their Corps and they were going to make us the best Marines. We are the future. We will fight the next war,” he says matter-of- factly.
He also began to change when other recruits he admired became squad leaders. He was dissatisfied he was not advancing. “Who you hang out with is who you are going to be.
“I got with my buddies around week three and said I would show my leadership skills.” Soon afterward, he was assigned squad leader with 12 men reporting to him. He was also promoted to private first class, an honor not bestowed on all recruits.
“I was the second squad leader. I took care of them. I think we had the best squad in the platoon. We were really close to each other,” Preston says.
To underscore the change he underwent, the day before graduation we met one of his drill instructors. The sergeant came up to me and said, “This man has made more progress than any other recruit in the platoon.”
The observation highlights the natural leadership skills our grandson possesses and speaks well for his military future. Receiving and executing orders has become second nature to the young warrior and reinforces the Parris Island slogan “We Make Marines”.
When he returns to duty after home leave, he will undergo Marine Combat Training, or MCT, at Camp LeJune, NC. This will in essence be a graduate course in combat training. The majority of the 27 day exercise will be spent in the field.
“From day one I go straight to the field. We will learn everything about becoming a combat survivor,” he says.
Following MCT, he will be sent directly to Ft. Benning, GA to train in his Military Occupational Specialty; likely artillery or tanks. As expected from a young man looking for adventure Preston says, “I want to do tanks. It’s more fun; more exciting.”
Indeed, it can be both. But most importantly, it will be providing our Nation with the ability to defend itself in a world replete with aggression and terror.
As for the future? Our young soldier looks forward to traveling the world and contributing to freedom’s defense wherever he may be assigned. After his four year enlistment he will decide on his next career.
“If the economy is good, I will leave the Corps and go into to real estate with my Dad. But if the Marines are looking good, I will probably re-enlist,” says Preston.
We salute Pfc. Preston Scott Hagarty for the courage to pursue his dreams and thank him for his service to our country. Semper Fi.
Off to visit his high school. Man were they impressed!
Stylish tasting room pouring velvetly wines
As you drive slowly up the steep entrance way—framed by vineyards—one is struck by the wall of glass windows at Delaplane Cellars.
Upon entering the sleek and tastefully decorated tasting room, a stunning artist-like mural of the Virginia countryside unfolds with waves of rolling hills stretching to the western horizon.
And you haven’t even tasted the wines yet. This is going to be fun.
Such are the impressions when visiting one of Virginia’s most respected wineries. Owners Jim and Betsy Dolphin opened their winery just five years ago, but accolades on what they’ve achieved are heard whenever quality Old Dominion wine is discussed.
“We want to be first class. We want to be at the ‘top of the mountain’…right up there with the big dogs,” says Jim Dolphin smiling. Whoof. Whoof. Goal achieved.
Passion is an overused word in the Virginia wine business but no term better describes what the Dolphins have brought to bear in creating their vision.
Jim Dolphin spent the better part of his career working for a real estate investment trust. When he joined the embryonic company in 1979, it had three employees. When he left nineteen years later, he was chief financial officer and the company had grown to 3,200 employees.
Betsy Dolphin was a portfolio manager at the same firm managing 12,000 apartment units. This couple knows from success.
Love of wine
As a young college student, Jim Dolphin fell in love with wine, especially Bordeaux from the Medoc region. “A fellow college student got me interested in quality French wine. Back then it cost four dollars a bottle,” he recalls fondly.
“By the time I opened the winery in 2009, I had a 1,500 bottle wine cellar. I know what good wine is and I don’t want to waste my time making plonk.”
So how did a man who carried one of the sharpest pencils in the financial trade become a vintner and winery proprietor? Enter passion, stage right.
After years of enjoying wine he asked himself “How’s this stuff made?” The question drew him to Jim Law, owner of Linden Vineyards. Law has a reputation for making some of the best wine on the East Coast. Several of the budding vintners who studied under him later went on to open their own wineries.
“I didn’t know anything about making wine. I took every winemaking and viticulture seminar Jim gave. Twice. In 2005, he let me help out with his harvest. I couldn’t get enough of it,” says Dolphin, while he continued to refine his home winemaking skills.
“I also enrolled in a UC Davis online winemaking course and began meeting many of the leading figures in Virginia wine.” The university has the most prestigious wine curriculum in the US and its graduates include some of the biggest names in American wine.
At the height of his home winemaking ventures, Dolphin had as many as 28 different wines in various stages of aging in the basement of his Maryland home. It became obvious turning professional was the next step and he launched his search for ideal winegrowing land, which is often steep and rocky to stress the vines and produced the highest quality fruit.
“In 2005, I started looking for land. I looked at more than a 100 properties finally settling on a 32-acre site in the northwestern part of Fauquier County, off Route 17. “I wished I had brought three times that amount of land so I could have put in more vineyards. I’m looking for more acreage now.”
In June 2009, he started construction on the winery and opened in November of that year; total investment in land and faculties ran to $2.5 million. He lives in a home nestled next to the winery and says, “I have a 150 yard commute.”
Given the influence of French wines on his palate, it comes as no surprise his focus is on reds, although his white lineup is impressive, including a medium bodied, lightly oaked Chardonnay.
Dolphin’s red wines are often blends that typically emphasize a single vineyard where the grapes were sourced from. The emphasis on the French concept of terroir—the somewhereness of where the fruit is grown—dominates his offerings with names such as, “Spring Lot” and “Williams Gap”, referring to the name of the vineyards producing the grapes.
In reflecting on the state of Virginia wine, Dolphin says, “A lot of people in the business have no business in the business. But that’s not news to anybody.
“Some people have gotten into the business who realize pretty quickly ‘This is not the romance I thought it was.’ There are twenty or so wineries that are always seeking to improve and get better and wines from those places will continue to get better and better.”
For those interested in tasting one of those producers’ efforts, a visit to Delaplane Cellars will enlighten.
For hours of operation, special events and more, visit http://delaplanecellars.com/
John’s Pick of the Month
2010 Left Bank Reserve
OK, we’ll all agree the price tag on this beauty is steep. So let’s have no less an expert than the wine director at The Inn at Little Washington, Jennifer Knowles, provide us her take on it. “More Merlot than Cabernet, it has a core of rich cassis and crushed blackberries tempered by cocoa powder tannins and balanced acidity. Meaty and powerful.”
Gotta love the way those folks talk…and the wine.
Published in the February 13, 2014 edition of the Culpeper Times.
Winery sales often lengthy and complex
There are 259 wineries in Virginia producing 511,000 cases of wine annually. The industry has achieved dramatic success in both growth and reputation since the first tasting room opened in 1975.
Today, the quality and repute of Old Dominion wine is recognized nationally and around the world. Last year, Steven Spurrier, a renowned international wine authority said, “Virginia is a solid competitor in the global wine industry.” Such high praise is a commonly heard refrain.
And yet, there is an anomaly to the sanguine picture of a robust and healthy wine culture: Few wineries are profitable and most are difficult to sell.
Indeed, notwithstanding advances in vineyard plantings and winemaking skills resulting in a commensurate increase in the production of fine wine, it still remains a challenge to actually make money in the business. If a winery isn’t turning a profit, potential buyers can be hard to conjure up.
With many of the state’s winery owners entering their retirement years, it is expected an increase in properties will go up for sale, especially if adult children do not share mom & dad’s dream. But selling even a marginally profitable business is a challenge. Typically, it takes three years or more to find a qualified buyer.
Rick Walden, owner of Virginia Estates, a Charlottesville real estate firm that specializes in selling farms, estates, vineyards and wineries says, “I’m just about the only guy in the state handling winery sales. How many are making money? I’m gonna go for zero.” He bluntly points up the narrow margins earned in a difficult business.
“There are probably thirty wineries for sale in the state but a lot of people do not want it advertised. They think its hurts their business. Last year, I wrote every winery in Virginia asking them if they were interested in selling,” says Walden. “I got twenty-five responses and now have $100 million in winery listings. I expect to sell five wineries in the next few months.”
While that prognostication seemingly runs counter to Walden’s profitability assessment, it does speak to the romance and lifestyle attraction of the business.
Others well placed in the industry, however, would disagree with his assessment and even plain speaking Walden later acknowledges some wineries do turn a small profit. “I had one guy call me and wanted a 20% return on his investment but from what I’ve’ve seen it’s more like one percent.” Other knowledgeable sources put the figure in the 5% range.
But profitable ventures are in the minority, with most industry observers saying less than fifteen percent of state’s wineries are making money.
When asked about the difficulty of growing wine grapes in Virginia, Walden responds with a quick, “Do you have a few days?”
“First, owners are biting their nails that bud break happens before a late spring frost comes along, like this year (2013), and cuts them off at the knees. Then, the stuff that survives gets beat to death by endless rains, and whatever does survive is ravaged by raccoons, turkeys, bear and deer.
“This year all of those animals were hungry because their food got frozen by an early frost so they came in and ate every last thing. The crop last year was hardly anything.”
Indeed, it was a tough 2013 harvest with frost and animal depredation taking its toll. But wineries across the state are making wine and it promises to be a decent vintage.
Walden closes with, “I don’t want to be a doomsayer, but buyers need to be aware of the real situation or sell $100 bottles of high quality wine.”
Romance, lifestyle & hard work
For anyone visiting a winery, the lure of owning one is understandable. Verdant vineyards framed by mountain or lake views and decks on which to enjoy the serene settings. Such scenes are alluring to buyers who hail from congested urban areas.
In reality, potential buyers must pony up at least a million dollars—at a minimum—and then commit themselves to an inordinate amount of work to grow the fruit and make the wine. Perhaps the most demanding part of the business is hospitality. Weekends are spent greeting customers, pouring wines and extolling the virtuous aromas and flavors in the glass.
When reality clashes with the dream, the property goes up for sale.
Stephane Baldi, owner of Hume Vineyards in Hume, placed his winery on the market early last year after only three years in operation. His wine is produced off-site, a process known in the industry as “custom crush”.
He’s asking $2 million for his large home, a vineyard and a tasting room. It doesn’t include his small inventory or brand name which would need to be negotiated separately. At 44, Baldi is among the younger owners in the industry.
“I grew up in the Loire Valley in France surrounded by vineyards and wineries and I am a huge wine fan. I saw what was happening with Virginia wine and thought it was the right time to make a move and open a winery.
“But my wife and I still had full time jobs in DC. Then, two years ago, we had a child and the winery is now more of a constraint,” he says. “The challenge of living in Hume is difficult. I run two businesses—one based in DC—and need to drop off our child at daycare every day. It really doesn’t leave us time to do anything. We are still young enough and we’d like to have a life but it seems we spend our entire life in the car.
“This is something we wanted to do at a point in our lives. Now, it’s time to move on.” He admits he has not gotten much interest in the property, saying, “The bottom line is nobody knows how to sell a winery.”
Bob Schenkel, owner of Altillo Vineyards, runs a small operation in southwest Virginia, and is asking $1 million for his winery that opened in 2010 and produces about 700 cases a year. “I’ve invested about $1.4 million but I’m selling it for a million. We have never shown a profit. It’s an inordinate amount of work. I think there is going to be a lot of turnover in the industry. A lot people would like to sell.
“The profit seems to be in events and entertainment. Many of the wineries that seem to make a buck are doing events. There is an ocean of wine out there but down here the quality seems to be a race to the bottom,” he laments.
“South of Charlottesville, the wine is abysmal. It’s sweeter and cheaper. Wineries see that it sells at festivals and they cater to younger folks who simply want to get a buzz and listen to a rock band. I’d like to see a better effort to improve the quality and the reputation of Virginia wine. The state talks a good game but their actions are tearing down the long term reputation.”
Strong words from an owner who has been unable to make it in the industry.
Schenkel goes on to say, “Rick Walden is my agent but most of his buyers are interested in the Charlottesville or Northern Virginia area. I’ve had next to no selling activity. Only one person has looked at my property and it was not a serious inquiry. They knew nothing about winemaking.”
Schenkel’s lack of enthusiasm that he will soon find a buyer is understandable. Mark Malick is a real estate agent in Leesburg that focus’ on winery sales and is co-owner of the winery, Maggie Malick Wine Caves, in Purcellville. His wife Maggie is the winemaker.
“Less than one percent of the population can afford a winery costing a million dollars or more. And what percentage of those people are actually looking for one? It’s a tough sell. Not many of these businesses are profitable.
“I try to talk people out of buying a winery before I talk them into it. I always try to get them to come out and see my winery and let them see everything that’s involved before we proceed. I basically try to pre-qualify them.”
Malick believes the number one factor in selling a winery is the owner’s age. The sellers “realize it’s time to move on, that it’s consuming them in both time and money.”
It’s common knowledge that virtually every new winery will labor for five to seven years before it begins to see a profit. But if committed and hard working owners stay the course, eventually some modest return on investment will likely emerge.
The Virginia viticulture extension service states two people can operate a five acre vineyard on a part-time basis. “Technically that’s true,” explains Malick. “But they will have to work every weekend during the growing season.” And that does not include making or selling the wine.
Over time, the emotional glow of plump grapes hanging heavy in a vineyard can begin to fade.
One model that has a better than average chance for failure is a multi-million dollar operation that opens its doors and immediately begins making tens of thousands of cases of wine a year. Finding a home for such exuberant growth is not easy.
Two over-the-top examples of this wine hubris were the Kluge and Sweeley estates. Both ventures envisioned producing vast quantities of wine and selling it quickly. Both ended in foreclosures, costing the owners tens of millions of dollars.
But even businesses that have grown slowly and produce good quality wine are not ripe for a quick sale. Naked Mountain in Markham was on the market for over a decade. The owners eventually got $3 million—the original asking price—but patience played a role in finding a qualified buyer.
Malick explains successful people start small and grow slowly. “A lot of people bootstrap their winery, doing things as cheaply as possible and buying used equipment. They do all the work themselves in the early years,” he says.
Malick cites Fabbioli Cellars in Leesburg as a model for success. Doug Fabbioli is a respected vintner and consultant who built a small, thriving business producing quality wines. His success was the result of his winemaking skills and his understanding of the industry and sound business practices.
“If owners stick with the business and get above 3,000 cases a year, then they will begin to see profitability,” says Malick.
Chris Pearmund and John Delmare have several decades of combined experience in the wine industry. Pearmund owns Pearmund Cellars in Broad Run and Delmare is the proprietor of Rappahannock Cellars in Huntly. Both wineries are profitable.
In trying to understand why a large percentage of the state’s wineries struggle to make money, Delmare’s analysis helps lift the veil of confusion. Start with the basics: 259 wineries statewide producing 511,000 cases.
“I estimate the top five producers together are making 200,000 cases. The next twenty wineries bottle an additional 150,000. That leaves 234 wineries generating some 160,000 cases, or an average of about 700 a year each,” says Delmare.
Conventional wisdom says it takes 3,000 to 5,000 cases to operate in the black. When you consider the financial investment, hard work and time the wine business consumes, those numbers are “frightening for the smaller producers” says Delmare.
If a small owner decides to back away from the business and sell out, he or she is faced with the hard reality of marketing a profitless business.
Last year, Pearmund tried unsuccessfully to sell his winery for $5 million but took it off the market. Today, it is back up for sale at for $4.5 million. Sotheby’s, a luxury real estate firm, is handling the sale. “The winery has been profitable every year it has been opened,” says Pearmund. Nonetheless, no buyer has yet come forward.
When asked how long it typically takes to sell a Virginia winery, Pearmund humorously replies, “It takes three bites to get to the center of a tootsie pop.” So how many bites does it take to get to the center of a cluster of grapes and see a buyer pop out?
Even when a serious prospect does step forward, it doesn’t always go smoothly. A case in point is Pearmund’s sale of the Winery at La Grange in Haymarket to a Chinese corporation.
The sale was valued at $5.6 million but was a rocky real estate deal.
Shortly after the June 2012 transaction, Pearmund said, “My experience at La Grange has been the most difficult of my professional career. I devoted six years to its success and have little to show for it.”
He estimates that today, there are ten wineries for sale. “In Virginia, I would guess 95% or more of the wineries opened since 1980 are still opened, how fantastic! What other business category has that track record?”
But the statistic also points to a pending wave of winery sales as original owners approach their late retirement years and may have lost both the passion and energy to continue.
John Delmare believes the commonwealth’s industry is maturing beyond something more than a hobby. “As long as we are hobbyists, there are no sale opportunities per se. There is no business rationale for buying a winery,” he states.
He observes that many sold to date have been distress sales, sold for pennies on the dollar, such as Kluge and Sweeley. “It’s hard to point to sales that were true market transactions. Some sales are really real estate sales. The buyer simply wanted the property, not the winery.”
Delmare states his business is profitable but doesn’t believe a buyer would purchase it solely on its financial return. “There is a quantifiable return in buying a winery that is an emotional return on top of a modest financial one that makes such a deal worthwhile.”
He goes on to explain wineries have always been that way regardless of where they are located. He cites California as an example. For years that state’s wineries have had a 5 to 6% return on assets. “That’s a lot of risk for just 6% return. If you take fully loaded costs—not an owner working for free—I’ll take a stab and say maybe ten percent of Virginia wineries are legit businesses.”
In addressing the issue of Virginia wine being expensive, he says, “When someone comes out and buys a $30 bottle of wine you have sold them an experience. They are buying more than the wine. We are selling experiences in our tasting rooms. If we were just taking orders, we would all be in trouble.”
Moving on to the more controversial issue of hosting events, he says he doesn’t share the disdain some people voice over the practice even though he does not pursue that type of trade.
Often weddings, parties, fundraisers and the like are what enable heavily mortgaged wineries to make a profit. Some larger businesses have weddings booked three years in advance, ranging from twenty to over seventy a year. Given the significant capital investments in these wineries, entertainment and hospitality are important revenue streams.
Delmare thinks many of the larger operations think their wineries are worth $8 to $12 million but he doesn’t see buyers out there to command such prices. “We are just starting to scratch the surface on having a market that produces those kinds of sales.
He underscores that aging owners wanting to move on will be especially hard pressed to find takers. “True legitimate buyers are hard to find.”
Delmare thinks a bank would be skeptical fully financing a potential buyer of his own winery, even though he has not personally had a problem securing capital. A bank may look at the borrower’s capability to service and pay back a loan outside of the actual business itself.
Inventory and equipment loans are not that difficult to get, he states, with banks lending up to 80% of their value. For example, if he were to sell his winery, a borrower might be able to secure an 80% loan based on the underlying value of the land, wine inventory and equipment but may still have to come with a substantial amount of cash, upwards of 50% of the total purchase.
“If a winery is making a five percent return on assets, but the bank interest rate is six percent, you are losing money on your loan,” Delmare explains. “In addition, the higher the loan-to-value goes you get to the point there is not enough cash in the business to support the loan.
“In today’s market, a 6.5% loan is typical. A 75% loan-to-value will result in every penny the business is making going to service the loan. Banks won’t loan that way. Banks look at asset value—collateral that secures the loan. Then they want to know ‘Where is the cash coming from to pay us? If you are making $1 a year, we want your payments to be 75 cents so you have a little cushion if things don’t go well,’ ” says Delmare, explaining how banks think.
He goes on to say, “Any business is similar, and in some ways a winery may be easier to finance because it is so asset driven. We have a lot of real estate, a lot of inventory and a lot of equipment; all things a bank can use to secure their loan.”
The banking discussion brings into relief that in addition to growing grapes, making wine and entertaining guests, potential buyers should have a custom fitted green eye shade hanging in the winery office. Sharp pencils are as important as sharp palates in this business.
With the current growth rate of wineries, it is projected within five years there could be more than 400 tasting rooms dotting the Virginia landscape. While such proliferation seems questionable given the challenges of opening one, it also speaks to the intense romance and lifestyle involved.
Creating flavorful wines and earning accolades from guests while living in picturesque rural areas is a powerful draw to pursuing a less than viable business. But romance is not a bedmate to logic and numerous winery owners would not trade their chosen endeavor for a conventional business.
More future owners will likely follow their lead. Delmare underscores the increasing challenges ahead. “When I started my winery in the late nineties, it was the sixty-second one in the state. I paid $2,000 an acre for land that today is going for $10,000 to $20,000.
“My business grew twenty to twenty-five percent a year initially. Today, it’s about seven percent. It’s only gotten harder. Everything is more expensive and the barrier to entry is harder.
“There is both a looming grape and labor shortage. All of these things will make entry a little higher. Small operators will be scared out of it so growth will maybe slow in the next five years,” he says.
One path to sustainability for his winery is securing permanent control over his grape supply. To that end, he is working toward purchasing and planting additional vineyard acreage. “I’m not doing it to grow but to secure the future of my winery.”
“Construction costs and getting wine into a bottle are fifty percent higher today than when I started. I hit it at the right time when I got in.”
Perhaps the legendary Dale Carnegie unknowingly summarized the pursuit of the Virginia wine business when he said, “When dealing with people remember you are not dealing with creatures of logic but creatures of emotion.”
And a cadre of emotional winery owners may be in Virginia’s best long term interests.
Published in the Winter 2014 edition of the Piedmont Business Journal.
Amissville firm caught wall-to-wall trend early on
In 1951, when the post-World War II housing explosion was beginning to surge, the carpet industry sold six million square yards of wall-to-wall. Seventeen years later, almost 400 million yards adorned homes nationwide.
Among the first businesses to spot the consumer trend from hardwood floors and area rugs to foot comfy wall-to-wall was John Early. Forty-seven years later, the thriving family business is an icon in Culpeper, Rappahannock and Fauquier counties.
In 1954, Early began his career as a flooring installer and commuted daily to jobs in Northern Virginia to make a living. Even back then, the traffic was bad. He eventually decided to work out of his home in Amissville and spend less time on the road. At the time, there were only two furniture stores and one lumber company in the tri-country area selling carpeting.
Early began working for them. But he soon realized those businesses did not see the rising popularity of wall-to-wall. He quit the job and opened Early’s Carpets. “When we started out, everyone thought we were crazy because there was nothing out here but those three firms,” recalls his wife, Lorraine, who provided a succinct history of the company. “John couldn’t make a living on that income and in less than two years on our own we had our building up and grew from there.”
Three years later, the store was expanded to include a warehouse. In 2014, there are plans to expand again with a 3,500 square foot facility dedicated to its rug cleaning business. Starting a business from scratch in the rural Piedmont region—and consider how rural it was forty-seven years ago—had its challenges.
“Back then, we hand addressed and mailed 42,000 flyers twice a year” to help build the business, says Lorraine Early. Hand cramps must have been a common aliment during those early marketing efforts. Today, the successful business generates $2.5 million in sales annually, employing twelve people, including five family members and a fleet of a dozen vehicles.
As the company grew, it became evident that John Early’s take on changing consumer demand was not his only ace on building the business. “Both John and I attended local high schools. We grew up with our customers. It was an asset to personally know a lot of them, including our teachers, friends and people in the banking business,” says Lorraine Early.
“It was a nice experience to go into the homes of these people. It was fun decorating and seeing the finished product. “When we started we didn’t have but seventeen dollars and some change in our savings. It was all done by hard work and faith in our local banks,” she says, explaining how bank financing worked in a gentler time.
As the business succeeded, carpet installation grew along with sales of oriental and area rugs, hardwood and ceramic flooring, window treatments, and carpet cleaning services. “Anything to do with flooring,” says Early. Trends tend to be cyclical, and today home decorating is moving back to hardwood floors and area rugs. Early’s is again well-positioned to capitalize on the shift.
Over time, it became obvious carpet cleaning could also generate additional income. For years, it was performed with small machines carried into the home. With the emphasis on today’s “Green Scene”, the Early’s purchased “mounted trucks”; a vehicle with high-power, environmentally friendly cleaning motors. Sucking up dirt and odors with these mechanical stallions made for happy homeowners. Remodeling does not readily come to mind with carpet installation, but when water damaged is encountered, Early’s will tear out and replace floors, walls, door jams and ceilings. However, getting homes dried quickly is critical to avoiding such expensive restoration work.
“Our technicians go to school in Georgia to learn how to completely dry out a home. During training, the company floods an entire house and the students learn how to dry it out. If you don’t get to it quick, mold will set in. We have even refinished guns that were water damaged,” she says.
When hiring a new employee, the Early’s emphasize they are embarking on a career, not just a job. “We tell them it’s like going to college, but longer. There is a lot of product knowledge and studying to do. A person needs to stay up with it. “John and I use to do all the training ourselves but now we depend on our daughter and son-in-law to do it. Once trained, we want our employees to stay in the business. It takes five years of on-the-job training to become proficient in the flooring business,” Early explains.
When the company was in its early years, it was typical to get just two or three customers a week. “We’d have customers push the buzzer on the store front door. My children were just a few months old and people would have to wait till I got there from our home out back,” she remembers. Today, those few of customers have grown to several hundred visits a week.
The clientele is still primarily local people, but increasingly the Early’s are seeing buyers from the Gainesville and Hay Market area. “While we do some commercial work—mostly local churches, banks and other businesses—the bulk of our business is still centered on residential.” The firm does not pursue track housing contracts.
One couple who are relatively new to Culpeper County heard about Early’s reputation and chose them to install hardwood flooring and carpeting. “Oh, we were very happy with them. The workmanship was great and we were very satisfied with the product,” the homeowner commented.
The Early’s could, no doubt, fill several volumes with similar testimonials. While the internet is changing how business is generated these days, Lorraine Early doesn’t see it as a growing force in the family shop. “Yes, we do have some online sales but in this business you still have to measure and touch things. For the most part, our customers want to see us,” before making a buying decision.
“This type of business requires a lot of personal attention. You need to stay on top of things. Everybody wants to do computers but our work is a little different. It’s hands on but rewarding. The personal touch is important to our success.”
What has also helped the small firm grow is its depth of inventory. The warehouse has over 75 large rolls of carpet, 400 area rugs, 100 rolls of vinyl, and selections of hardwood and ceramic flooring to chose from. “When customers are working on a project and want to complete it, they can come in and often find what they need without having to order it.”
In reflecting on the last six years, Lorraine Early says. “It’s been hard. There hasn’t been much improvement. I feel very fortunate our buildings are paid for but young people need to be trained and they need the jobs. Business comes in spurts and you get excited but then it drops back.
“We’ve had to do away with a lot of our employee benefits, except health insurance. We have kept it for all our employees. But paid holidays and vacations have had to go in order to afford the insurance.” While remodeling is often viewed as a bright side to a depressed economy, the Early’s don’t see it.
They do more advertising to keep their name in the market place. The benefits of growing a business when you are young and living in a rural area is the ability to attract customers you grew up with. Today, both the owners and their faithful customers are aging and younger newcomers moving into the area. “We need to keep our name our there so people know who we are.
There has been influx of new people and they don’t always know us.” One benchmark of the quality work provided by Early’s is repeat business. It’s not unusual for them to perform work on floorings that were installed thirty or forty years ago. “The quality of our work has really held up,” Lorraine Early says.
At this stage of his career, one might call John Early, Installer Emeritus. He acts as the public face of the company, handling public relations and work site visitations, while monitoring customer satisfaction and quality control. At 79, is well positioned to know when a project needs a bit of fine tuning. His depth of experience also serves to train and mentor his younger employees.
Lorraine Early speaks with respect when she shares that her husband is a two time cancer survivor. “He’s had health issues that he shares it with people who are going through a lot of turmoil. He is still active and is a very determined man,” she says with pride.
Lorraine Early managed the sales force and the decorating side of the business for decades and still oversees it. However, back in 2000 she turned much of the daily in-store work over to her daughter, Sonja, who is the store manager and project scheduler.
Sonja’s husband, Solon Betts, is head installer. Son John handles in-home measuring assignments, and grandson, Ted, heads up cleaning and restoration. Grandson Cody, attends the itt Technical Institute in Chantilly, preparing for a career in computers. Meanwhile, he oversees the company’s computer applications. The Early’s have no plans to sell their business but if they ever did, the buyers would be family members. What they have built together will stay together as the family flagship.
For hours of operation and a full description of the company’s product line and services, visit http://earlyscarpetinc.com/ Published in the Winter 2014 edition of the Piedmont Business Journal.
Heating and air conditioning firm building on 78 year legacy
FDR was re-elected in a landslide. Gone with the Wind first hit the bookstores. And the cost to mail a letter was three cents. It was 1936, the year McCrea Equipment Company was founded.
To place that success in perspective, the average lifespan of leading U.S. companies has decreased from 67 years in the 1920s to just 15 years today. The Fauquier County firm is bucking the trend by building business the “McCrea Way. Quality service the first time, every time”.
“Mack” McCrea created the then heating and air conditioning wholesaler in the harsh economic environment of the mid-1930s, when unemployment raged at 16.9%; over twice what the US is experiencing today. When he died in 1965, three of his employees purchased the company’s stock.
One of those employees was George Lanhardt, who subsequently bought out the other partners in the early 80s. Since then, it’s been a family run business with Lanhardt’s son, Wayne, forging the company’s growth for nearly three decades.
Today, the firm has 215 employees—63 at the Warrenton location—and operates six companies in VA, MD, and PA. Wayne Lanhardt’s sons, Shane and Seth, are the firm’s next generation of leaders who are continuing the company’s performance by building a young, success-driven corps of managers. Their accomplishment is reflected in increased revenues generated during a depressed economy.
“We have a very strong team with a lot of guys in their 30s and 40s in management positions. The team is very forward thinking. We’ve made a successful transition from an older company. A lot of older companies stumble. In the end, it’s really about your people. That’s the strength of our organization,” says 36-year-old Shane Lanhardt, who runs the Virginia business and spent time sharing the firm’s story with the Piedmont Business Journal.
Unique business plan
Unlike many HVAC businesses, McCrea sets itself apart by being involved in all aspects of heating and air conditioning services. This includes new home installations, service and replacement, manufacturing of sheet metal, duct and piping materials, and providing energy analysis and audits. The firm is among the largest HVAC firms in the DC metro area.
In addition to the scope of the business enterprises, the firm had the prescient to see what was unfolding in the red-hot real estate market of a decade ago. “The housing market was booming during the nineties. It was almost uncontrollable growth. We were installing 10,000 units a year in new homes. But we knew the bubble was going to have to burst,” recalls Lanhardt.
And burst it did. But McCrea had positioned itself to survive the collapse. “We decided to create service and replacement companies and augment new home construction sales with more service and replacement work. In 2000, 95% of our business was in new home construction. Last year, that figure dropped to 60% with 40% service and replacement picking up the difference.”
Lanhardt goes on to say, “The housing market has recovered some but I don’t think we’ll ever see what it was doing back in the nineties. While we have done 40% more new work this year than last, I don’t think that pace will continue.”
The DC metro real estate market is among the most stable in the Nation but Lanhardt opines there is still “a lot of instability in the market. If you know your job is stable, then a decision to replace a $6,000 unit becomes easier. If not, you might pay $500 for a repair. There is a little trend of more people repairing and not buying the best systems because of instability,” Lanhartdt says.
One of the hallmarks of McCrea is not trying to sell customers something they don’t need or can’t afford. The business is based on volume sales and “we don’t want to make the most amount of money off each customer. Our philosophy is to provide good service, do a great job and provide value to people for their money,” emphasizes Lanhardt.
Building market share
One obvious advantage of building sales with a decades old business is a large customer base to draw upon. The firm has a 200,000 person customer file that receives a quarterly newsletter providing information on new developments in the industry, tips on reducing heating and cooling costs, special promotional offerings on service and installations and more.
“We keep in touch with our customers through our newsletter, Facebook and Twitter. Our industry is reactive so customers don’t normally plan to buy new. Their purchase is often dictated by the immediate need of a failed unit. Building brand so that former customers think of McCrea when facing an HVAC need is critical. There is no cold calling in this business. Word of mouth and branding are important,” says Lanhardt.
As in every industry, technological advancements have been dramatic in the last few decades. Today, an increasing source of new business is geothermal. It provides the highest energy efficiency but is expensive.
Lanhardt says, “The federal government gives a 30% tax credit back to dollar one on the installation costs on these systems. And there is no cap on that number. It is the most efficient unit you can buy. A geothermal unit can reduce utility costs by 70% to 80% a year.”
Significant savings are not limited to premier systems such as geothermal. Propane or oil systems that are upgraded to heat pumps with oil backup can generate 50% to 60% savings in utility costs from systems installed just a decade ago. Science and technology strikes again.
Nonetheless, technical advancements can possibly be trumped by commonsense. Lanhardt underscores old fashioned strategies such as raising window shades and pulling curtains back during the winter months will allow solar energy to hold heating costs down. Reverse actions in the summer permits a darken house to retain air conditioned cool air.
“Our newsletter regularly includes cost saving recommendations,” says Lanhardt.
The importance of giving back to the community that helped fuel its growth is evident in McCrea’s work with Fauquier Habitat for Humanity. Last January, the firm provided discounted HVAC units and no cost installation for two duplexes Habitat built.
The duplexes are a collective effort between Habitat and the Fauquier Family Shelter. The Shelter provides transitional housing for families in need. If they subsequently qualify, they are eligible in securing mortgages as permanent residents of the newly constructed duplexes.
Brenda Drerenberger, Executive Director of Fauquier Habit for Humanity, explains, “Shane is great to work with. He arranged for the manufacturer, Trane, to provide the deeply discounted units to Habitat and then donated McCrea’s labor costs to install them.
“The program is a hand up not a hand out. Each family must be employed and quality for a mortgage. They are also required to provide 400 hours of sweat equity. The program gives them an opportunity to step up in life and improve their future possibilities. But the lower we can keep construction costs the lower the family’s mortgage.”
Habitat has 200 volunteers that provide much of the construction labor but, by law, cannot install heating and air conditioning units. McCrea fulfills that need.
“I went to them this year and was not expecting them to be able to help again but they did,” says Drerenberger.
The firm also supports Habitat’s annual golf tournament and other Habitat projects in Virginia.
Given the business and community philosophy that drives McCrea Heating and Air conditioning, celebrating 100 years in business appears to be just a matter of time—2036 to be exact.
Published in the Winter 2014 edition of the Piedmont Business Journal.