Good taste

Anthony Terlato has helped reshape the wine industry
After driving six hours to visit a restaurant in Portogruaro, Italy in 1979, Anthony Terlato opened the wine list. Inside, he found 18 bottles of pinot grigio. To the restaurant’s surprise, he ordered all of them..
    “The waiter said, ‘This crazy American just ordered 18 bottles of wine!’” recalled Terlato, 70, chairman and chief executive officer of Terlato Wine Group in Lake Bluff. “The owner said, ‘When are the rest of the people coming?’”
    Informed that Terlato would be dining alone, the owner sat down with the American customer and proceeded to taste all 18 varieties
with him, including one called Santa Margherita. Today, that pinot grigio – imported by Paterno Wines International, a Terlato Wine Group company – is the most-requested imported wine in U.S. restaurants. Though Paterno now sells 450,000 cases of Santa Margherita a year, before Terlato’s auspicious trip to find a pinot grigio to import, the
pinot grigio variety was unknown in the United States.
    Starting in the wine business a half century ago at his father Salvatore’s Chicago store, Terlato today is flourishing as an importer, producer and marketer. He concentrates on luxury wines, defined as those bottles costing more than $14. According to Crain’s Chicago Business, in fact, Terlato Wine Group is among the top 120 private
companies in the Chicago area in terms of revenue.
    Though serving wines at dinner and in restaurants occurred infrequently during the Eisenhower era – the whole wine list at a restaurant could consist of one brand, such as Paul Masson – Terlato has helped spark a revolution in people’s drinking habits.
    “He has brought Italian wines to world-class status,” said Fred Rosen, owner of Sam’s Wine and Spirits in Chicago, who has known Terlato for more than 50 years. “His success is attributed to how smart he is. He could see long-term what the wine industry should look like.”

Changing times
Barely out of his teens, Anthony Terlato began work at his father’s wine and spirits store, Leading Liquors, at Clark and Ridge in 1955. A rarity for the North Side of Chicago – the store sold 77 imported beers when Schlitz was the town’s beer of choice and offered yards upon yards of wine – Terlato tackled every type of job while imbuing crucial lessons for his future in luxury wines.
    “What I learned from my father was the best customers – the professors from Loyola University, the doctors – bought the good wine,” he said.
    Soon, he joined his fatherin- law, Anthony Paterno, at Pacific Wine Co., which bottled California wines. He sold pints of wine on Chicago’s Madison Street while decked in tie and cufflinks (“I looked like a fly in milk,” he said). After jettisoning that task, the budding businessman met a few import salesmen through Pacific and decided he’d like to start importing wine.
    After he struck deals with a number of French labels, Terlato faced a problem: how to persuade restaurants to serve the wines.
    “I said, ‘Put one of my wines on your list and I’ll print the list,’” Terlato said. “The plan was, we got one on the list, we’ll get more as time goes on.”
    After picking up important distribution contracts and solidfying the company’s transition from its retail roots – Paterno Imports was incorporated in 1964 – Pacific became the distributor of Robert Mondavi wines in 1967. Other successes followed: the introduction of Corvo, the first Sicilian wine in the United States, the blossoming of Santa Margherita and the company’s expansion into winery ownership, with the purchase of Rutherford Hill Winery in Napa Valley in the mid-1990s.
    Before the Rutherford purchase, Terlato had started scouting spots for a new corporate headquarters. He looked at land around O’Hare Airport. Then he stumbled upon an advertisement for an estate in Lake Bluff.

To the manor born
Sitting in his office at Tangley Oaks – a former children’s sleeping porch filled with bottles of wine, family photos and mullioned windows – Terlato described entering the 26,000-square-foot mansion for the first time.
    “You walk into the house you’re going to buy, and you see your chair, where your son’s office will be,” said Terlato, who lives in Lake Forest. “I fell in love with the building. We deal with so many Europeans who have castles of their own.”
    But like most castles, the new Tudor Gothic headquarters – designed by Harrie T. Lindberg and finished for the Armour family in 1932 after 16 years of construction – lacked modern amenities.
    “It had no air conditioning. We had no hot water. No kitchen,” said Terlato.
    Today, the 61-room manor – where 300-year-old Chinese rice wallpaper graces a onetime ladies powder room and whose wooden front door is heavy enough to frustrate a Chicago Bear – is refurbished. At lunch, many of the 56 employees (among 200 employed by Terlato Wine Group across the country) gather in a kitchen to sip wine
while chef Colin Crowley prepares oysters and other delicacies. A handful stroll to the dining room, where a selection of red and white wines await and, oftentimes, a guest from Europe or elsewhere is entertained.
    The mansion mirrors Terlato’s philosophy that embracing quality is the best way to conduct business.“He’s the best-dressed person in the wine industry,” Rosen said. “Everything he does is firstclass. I’ve never gone to dinner with a guy like Tony at McDonald’s.”

Next generation
The third generation of Terlatos to be involved in the wine business is making its mark. Bill Terlato, president and chief operating officer of Terlato Wine Group and Paterno Wines International, has helped Paterno become the leading marketer of luxury wine in the United States. His brother John, executive vice president of Terlato Wine Group and Paterno Wines International, led Pacific Wine Co. into hand-crafted beers – at one point Pacific became the largest Samuel Adams distributor in the world – and today looks to increase Paterno’s productivity.
    The new generation is well versed in technology, and their influence is apparent on their father. With a few clicks on his computer, Terlato shows a visitor an old television commercial that first ran in New York City during the 10 p.m. news, describing his discovery of Santa Margherita in that faraway Italian town.
    “I don’t know how I afforded that commercial,” Terlato mused.
    These days, Paterno Wines International has no problem affording color advertisements featuring Santa Margherita Pinot Grigio in national publications such as The Wall Street Journal. Which suggests one way to sum up Terlato Wine Group’s phenomenal rise: Terlato, who once sold wine on Madison Street, now lets another Madison– Madison Avenue, the catch phrase for America’s advertising industry – sell wine for him.

©2005 by Lake Forester.