A LIFE IN WINE
 Anthony Terlato earns Wine Spectator’s
Distinguished Service Award.
Tony Terlato’s life in wine has touched nearly
every facet of the industry, from working the
floor at his father’s Chicago wine shop in the
1950’s to his days as a Midwestern distributor,
then as a wine importer and most recently as a winery
owner. Guided by his passions, Terlato has introduced
Americans not only to new producers but to entirely
new categories of wine.
Consumers may not know Terlato’s name, but in all likelihood
they have opened a bottle of wine that bears his
imprint. He is chairman and CEO of the Chicago-based
Terlato Wine Group, an importer that markets producers
such as Gaja, M. Chapoutier and Pio Cesare through
its Paterno Wines International division, and almost single-handedly put Pinot Grigio on the map in the United
States with the Santa Margherita brand. In the 1990s,
Terlato’s company became a wine producer as well, with
investments in California wineries such as Rutherford
Hill, Chimney Rock, Alderbrook and Sanford.
“When I look at the market today, I see gluts,”
Terlato says, discussing the philosophy that drives
him and his company. “But there’s no glut of Gaja.
There’s no glut of wines like Pétrus or Mouton, no
glut of Roederer Cristal. No matter what you’re doing,
if you’re not making decisions for quality reasons,
you’re going backwards. Quality is the only thing
that endures.”
Terlato has demonstrated time and again an ability to
reinvent himself and change with the times, always striving
to make better wines. For his half a century in the
industry, for his achievements in business and as a philanthropist,
Terlato earns Wine Spectator’s Distinguished
Service Award for 2004.
At his home in the hills above St. Helena, Terlato
is serving lunch. And cooking it. “These clams
are Manilas. They’re the best, just the flavor of
them,” he says. The shells rattle as he sets down the
plate, a fragrant plume of white wine, garlic and olive
oil rising from the pasta beneath.
Passionate about cooking since he was a child, Terlato,
now 70, cooks almost daily for family and customers
alike. Squarely built, his eyes at once inquisitive and
intense, he is a formidable force in the kitchen. Wearing
a white apron and armed with a wooden spoon,
he is determined that lunch will be nothing less than
perfect.
Attention to detail, says Pio Boffa of Pio Cesare,
is one of Terlato’s strengths. “He’s never happy with
himself and he’s never happy with anyone [else],” says
Boffa. He calls Terlato “a volcano,” not in the way an
American might use the word, Boffa explains, but more
in the Italian way: full of energy, bursting with ideas and“making new things every day.”
But even as he’s sweating the details, Terlato always
has an eye to the future. It’s been that way since his
earliest days in the business.
Born and raised in Brooklyn – the accent still lingers on certain
words – Terlato was 21 when the family moved to Chicago in
1955 and his father, Salvatore, opened a wine and spirits store.
“In ’55, there were no real wine shops, there were liquor
stores and they had a bar and everything was behind the counter,”
Terlato recalls. His father’s store was one of the first selfserve
wine and spirit stores in Chicago. “We had 90 feet of wine
bottles laying down and customers could go up and down the
aisles. I fell in love with the concept.”
It was a time when Sherries, sweet Ports and wines like Bolla,
Lancers, Blue Nun and Mateus dominated the industry in the
United States, but Terlato’s interests lay elsewhere. “I became a
Francophile,” Terlato says. “We had 1945 Bordeaux and ’47s and’49s, ’53s, ’55s. Lafite, Latour and Margaux were selling for $2.98
a bottle. It didn’t cost anything to drink absolutely wonderful
wines.
In 1956 Terlato married JoJo Paterno, and within a few
years he joined his father-in-law’s business. Anthony Paterno
owned a large Chicago bottling company. For decades, California
producers had shipped wine in bulk to be bottled
and sold regionally, but by the late 1950s many wineries
were beginning to bottle at home and Terlato convinced Paterno
that the company’s future was in wine wholesale.
From the beginning, Terlato was an innovator. In those days,
Chicago restaurant wine lists were mostly limited to four or five
wines from the same producer, printed on the back of the menu. “If you were willing to pay for the cost of printing the food
menu, you could get your wines on the back,” says Terlato. He
began supplying restaurants with leather-bound lists and didn’t
require that all the wines come through his distributorship. The
reverse psychology paid off; restaurants embraced the new lists
and stocked plenty of Terlato’s wines.
By the early 1960s, Terlato’s company was doing business
with industry pioneers such as Alexis Lichine in Bordeaux and
importer Frank Schoonmaker, who specialized in Burgundy and
German wines. By the late 1960s, Paterno was importing its own
brands. Its early successes were the high-volume Corvo brand
and a dessert wine named Sicilian Gold, but Terlato moved increasingly
to handcrafted wines such as Pio Cesare from Italy’s
Piedmont region.
“He was moving into quality in the 1970s when everybody
else was looking at price,” Boffa says, “and that became a lesson
for a lot of people.”
Many importers over the years could lay claim to establishing
a particular label or producer in the United States, but Terlato
almost single-handedly did it for an entire category – Pinot Grigio.
It was 1979 and Terlato was eating alone at a restaurant in
Portogruaro in the Alto Adige region of Italy. Charmed by the
local white, Pinot Grigio, he decided to taste as many as he
could and he ordered all 18 bottles on the restaurant’s list.
One wine stood out. It was called Santa Margherita. Terlato
paid a visit to the winery and signed a deal to import the wine.
Neither the producer nor the grape were well-known in the
States at the time, but Santa Margherita is now one of the 25
most-imported wine brands in the United States, according to
Impact Databank, at 450,000 cases per year.
Terlato sold the distribution division of the company two
years ago and now focuses on marketing, importing and production.
Today, his company promotes and markets 1.5 million cases
of wine annually and his wineries produce 350,000 cases a year.
“We sell one out of every 10 bottles of wine priced at more
than $14 in the United States. Three out of every 100 wine consumers
are my customers,” Terlato says.
While Terlato leads the way, Terlato Wine Group is a family affair.
Terlato works closely with son William, who is president and
COO, and son John, executive vice president. The company has
its headquarters in a 1916 Tudor-Gothic manor called Tangley
Oaks, in a leafy suburb outside of Chicago. On any given day,
you’ll find one or all three Terlato men cooking lunch. Food and
wine are old traditions in the family.
“My grandfather was a butcher and my grandmother was a
great cook. My father loved food, he cooked during a time when
men normally weren’t cooking at home,” Terlato says.
In Terlato’s kitchens, opera is the music of choice. “I love opera,”
Terlato says. “My father had opera on in the house all the
time. I could whistle La donna é mobile from Rigoletto when I
was 10.”
His passion for music, food and wine has laid the foundation
for most of his philanthropic work. He is on the board of the
Lyric Opera of Chicago and the Chicago Symphony Orchestra.
He is also on the board of trustees for Copia, the American
Center for Wine, Food and the Arts.
When not in Chicago, Terlato can often be found in Napa
or Sonoma counties. In the mid-1990s, he added vintner to his
résumé. In 1995, Glass Mountain – a joint venture with Mercian,
the company that owns Markham Vineyards in St. Helena– marked Terlato’s first foray into winemaking.
The following year the company bought Merlot specialist
Rutherford Hill in Napa Valley, and has slowly rebuilt the brand. “The winery went through a period in the 80s when a lot of responses
to problems weren’t solutions,” Terlato says. “They kept
lowering prices, cutting costs. Instead of making less wine and
making it better, they made more and tried to make it cheaper.
To me that wasn’t a solution. So we inherited a brand that was
in image decline.”
Terlato has invested more than $7 million in Rutherford
Hill, expanding the winery, finding new grape sources and adding
a 6-acre Cabernet Sauvignon vineyard on a hillside near
the winery.
He has made similar improvements at the other wineries – investing
about $11 million at Napa’s Chimney Rock, which the
company now wholly owns, and about $5 million at Alderbrook
in Sonoma County, of which Terlato bought a 60 percent share in
2001. The most recent addition came two years
ago when the company bought a 46 percent share
in Sanford, one of Santa Barbara’s oldest and
most respected producers.
“We look at our winery portfolio as if we
are a restaurant putting together a wine list,”
Terlato says. “Each of these wineries specializes
in something. We have Merlot with Rutherford
Hill, Cabernet with Chimney Rock, Zinfandel
with Alderbrook and Pinot Noir with Sanford.
And very shortly, we will be doing Pinot Grigio
from Russian River and Santa Barbara.”
Overseeing winemaking for Terlato’s California
properties is Doug Fletcher, longtime winemaker
for Chimney Rock. “Tony understands
the business and has enthusiasm for what he’s
doing. When we were planning the new [Rutherford
Hill] vineyard, the first question that he
asked was ‘Is this the best possible place to do
it?’ not ‘How much is this going to cost me?’”
While Terlato doesn’t rule out the possibility
of adding more wineries to his portfolio,
he is most excited about his joint ventures
with Michel Chapoutier of France’s
Rhône Valley. Terlato has a “participation”
in Chapoutier in France and is partners in
a project with him in Australia. The partnership owns 475
acres in the Australian Pyrenees, of which 85 acres are planted
to Syrah; they are releasing a line of wines priced from $25
to $100.
“Michel is a genius,” Terlato says. “We like very much the possibility
of what can happen with Syrah in Australia. I think that a
Cabernet Sauvignon drinker can adjust very easily to Syrah.”
Syrah isn’t the only bright star in the future as Terlato sees it.
While the wine industry has had its share of problems in recent
years, Terlato is an optimist.
“We’re only on the threshold of people enjoying wine,” Terlato
says. “In the next five or 10 years there’s going to be another – for lack of a better word – enhancement in wine. I don’t know
what that does to the per capita consumption. I’m talking about
the quality of what people are drinking. I look back and think
this is where I was in 1955 and this is where we were in 1967
and now today. Wine is becoming cultural. People are better
educated. If you have wine knowledge, your social status is elevated.
If you look back to the ’50s that wasn’t the case.”
As Terlato looks back on his 50 years in the business, he sees a
progression that makes him proud, and deservedly so.
“When my father had the store, we were able to influence
the drinking habits of people within one mile of each side of the
store. When we became a distributor, we were able to influence
the drinking habits of people perhaps 20 miles each side.
When we became a national importer, I was able to influence
the drinking habits from California to New York and from Detroit
to New Orleans,” Terlato says. “As a winery owner, I can
influence the world.”
Thanks to Terlato, it’s a world that drinks a little better today
than it did when he began.
By Tim Fish
©2004 by Wine Spectator.
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