Terlato, seller of others’ wines,
rolling out its own

Company starting slow: Two labels due out this year, one in 2006
In his long career, Anthony J. Terlato has been a retailer, importer and distributor of fine wines, as well as an owner of wineries. Now he’s about to put his name on a label for the first time.
    Terlato Wine Group in Lake Bluff, where 71-year-old Mr. Terlato serves as chairman and CEO, this month is unveiling its 2004 Terlato
Vineyards pinot grigio, made from grapes grown in Sonoma, Calif., and priced at about $22 a bottle. The company plans to follow that up
in September with its 2003 Terlato Family Vineyards syrah from Napa Valley’s Dry Creek region and priced at $35. A cabernet sauvignon blend from Napa, with a price of $48, is due out next year.
    The new wines represent a mere blip on the Terlato sales chart, with projected sales in the first full year of fewer than 4,000 cases, or about $1 million. That’s a tiny fraction of the $200 million in volume the company recorded in 2004, when sales rose more than 7%.
    Yet the Terlato labels represent a shift for a company once content to market other people’s wines but now increasingly involved on the production side.
    “We have no real plan to build a big brand of our own at this point,” Mr. Terlato says. “And this isn’t about making a lot of money at the start. I just get real pleasure in making a wine that is very special.”
    Terlato Wine Group has been on a buying spree over the past decade, acquiring such California wineries as Alderbrook, Sanford, Chimney Rock and Rutherford Hill. The company also has invested in several far-flung joint ventures overseas, including a partnership with the French Rhône firm Chapoutier to grow grapes in Australia.
    “The Terlatos are very skillful in marketing wine,” says Johnson Ho, owner of Knightsbridge Wine Shoppe in Northbrook. “Tony is very good at launching brands. The family knows all the right people in the retail and restaurant trades and should be able to place at least small quantities of their own-label wine very effectively. I’m not sure this
will ever be a huge brand on the scale of a Mondavi, however.”
    The Terlatos, in the meantime, continue to expand their core import portfolio, recently adding the U.S. rights to Bollinger Champagne. The company has begun importing wines from Greece and Chile and other second-tier wine-producing nations. William Terlato has set a goal of doubling sales every five years.
    “That means 17% growth each year,” he says. “It’s ambitious, but we can do it.”

©2005 by Crain Communications Inc..