Tom Hobart staying focused – owner of Vinogistics consulting firm – Interview
In a corporate world of specialists, veteran wine industry executive Tom Hobart is a self-described generalist. You have the feeling Hobart would rather be walking a vineyard or overseeing a construction project–anything involving the nuts and bolts of the business–than sitting behind a desk counting beans.
Hobart’s entry into the wine business was vastly different than today’s success-track types. “I got into wine because I knew how to handle a chainsaw,” Hobart said over a long and amiable lunch at Chalet Basque, north of San Francisco.
Hobart did some tree-clearing on a new vineyard project, working with viticulturist Barney Fernandez. Through Fernandez, he met Frank Wood, the founder of Clos du Bois winery, where Hobart spent 29 years and helped guide the Sonoma County winery from an initial production of 2,000 cases to 1.5 million cases before he left, holding the title of senior vice president of operations at the parent company, Allied Domecq.
So, in 30-plus years in the California wine business, Hobart has moved from chainsaws to chain stores. “I wouldn’t touch a chainsaw now, that’s for sure,” he said.
Hobart has now fled the global corporate life to launch Vinogistics, a consulting business that offers strategic planning on all aspects of the wine business, including vineyard management, grower contracts, winery cost analysis, construction and personnel management. When he announced the start-up of Vinogistics, Hobart said in a statement: “In order to be successful today, a winery or vineyard operator must understand how their business relates to the global industry.”
He said his focus is long-range planning, but he is also willing to take on interesting short-term projects, not only in California but anywhere in the world. “My wife would love for me to travel more,” he said with a laugh.
How have things changed since those early days with Frank Wood?
“The business has always been competitive, but in the past, I think people could survive and still have a good time. I think we used to have more fun. It’s a war out there now. The competition has become much more fierce,” he said.
Given the state of competition, what is Hobart’s formula for survival?
“Stay focused. Have a plan for the first five or 10 years. You have to know where you want to go and when you want to get there,” he said.
“It’s all about paying attention. Paying attention to the vineyards, paying attention to the wine, paying attention to the market. Stay focused,” he said.
Hobart said another big change was the level of global competition. “You have to be in the global market, and I don’t mean just exports. You have to be able to compete in the home market with Australia, with Chile and everyone else.”
He added that Australia has done such a remarkable job because they made a plan and have stuck to it. “If you look at the growing conditions there, the climate, it isn’t that much different than the Central Valley. It’s just that Australia went for it,” Hobart said. “Australia has done a good job of selling Australia.”
He pointed out that with the exception of a small number of consumers, no one was likely to know the difference, for example, between Dry Creek Valley and Alexander Valley. “And why should they?”
Hobart is concerned that because of the relentless competition and corporate influence, wineries have become more conservative. In reply to a question about why all wine labels seem to look alike, Hobart said it was an effort to make the consumer feel comfortable. “The wine consumer is very jittery, very unsure of what they are buying. They are afraid to make a decision. I know people with PhDs who are afraid to order wine in a restaurant,” he said.
“We simply don’t have a wine culture. If the Italians hadn’t come to this country, we wouldn’t be drinking wine now,” Hobart said, taking a sip of an Alsatian Pinot gris we had ordered.
What to do?
“You have to focus on who you are selling wine to and that’s really the trade, what we call the gatekeepers,” Hobart said.
“You’ve got to keep them happy,” he added.
Hobart said there was a great need for more affordable wine, and for that to happen, grape prices have to come down. “You can’t really make an affordable Chardonnay at $1,800 a ton, but at $1,200 a ton, you can sell an $8 or $9 bottle of Chardonnay and make a fair profit.”
He admitted, however, that there are no easy answers to setting grape prices. “The reality is that grapes seem to be either in over-supply or under-supply, and they are a perishable product.”
On the subject of affordable wine, Hobart said he believed Bronco’s “Two-Buck Chuck” had really saved the Central Valley. “There would have been a lot more grapes pulled if it hadn’t been for that wine,” he said.
Down the line, Hobart said, the ability of wineries to sell wine directly to the consumers, especially through wine club sales, would mark a major change in the wine market. “Those clubs can be big business if the winery is able to ship anywhere.” Hobart said this could be especially important for wineries up to 25,000 cases.
How about Internet sales?
“I see the Internet more as a means of offering information about the winery than for sales,” he said.
On the vineyard side, Hobart said that Pierce’s disease remains a huge threat. “It’s an epidemic waiting to happen on the North Coast. So far, the counties have done a good job of containing, but with the budget crisis here, I don’t know how long they can keep the sharpshooter out,” he said.
Hobart said there have been several important changes in the vineyards since he entered the wine business, with a another just underway. “I think the biggest change has been in trellising and in breaking out of the 8-by-12-foot California sprawl. With closer spacing, the new trellis systems have opened up the canopy, moved the fruit away from the leaves, allowed better air movement and put more sunshine on the fruit without the threat of burn. This has been a major step in improved grape quality,” he said. “Now, growers are starting to talk about pounds of fruit per vine, not tonnage per acre. It’s made them better farmers.”
The second major change, according to Hobart, has been farmers learning to understand the soils.
“Farmers now are working to make the soil healthier which leads to healthy grapes and fewer chemicals. They are taking a more balanced look at the vineyard.”
Hobart said one change just coming about which will have a major impact in the future is clonal selection. “It all started with Pinot noir, but now other varieties are involved. We are just at the beginnings of that.”
On organics, one of the hot topics today, Hobart pointed out that many growers are using organic techniques now, simply because it leads to better grapes, but as for going organic all the way, Hobart said the only way that could be justified in a business sense was if wineries would pay a premium for organic grapes. “It is more labor intensive to farm organically. Growers should get paid more for those grapes if the wineries want them.”
As for the public perception that the wine business is anti-environmental because of new vineyards being planted, Hobart said he didn’t believe the industry was doing an effective job of dealing with that. “Every time someone takes out an apple orchard and plants a vineyard, people get upset. The economic reality is that you can’t make money, at least in Sonoma County, growing apples. We’ve done a bad job of explaining our position to people and explaining how important the wine business is in the community. We are seen as a monoculture, but the wine business is actually supporting a larger economy. We need to show how much we have in common.
“Looking back, I think the greatest thing about the wine business is that we are not making widgets,” Hobart said, as I poured another glass of wine all around. “Making wine is a craft. Each vintage, the winemaker has to deal with what he’s got. A lot of people try to talk about wine as if it were a science. It isn’t. It’s an art or a craft. That’s one thing that has made it so much fun over the years, and I’m very happy now to be getting back to the basics.”
(You can reach Hobart by telephone at (707) 431-1640 or e-mail at firstname.lastname@example.org. The fax number is (707) 431-2173.)
RELATED ARTICLE: Tom Hobart’s Favorite Wine
Hobart said he had a love affair with Cabernet Sauvignon for many years, but now he has two new favorites–Zinfandel and Pinot noir.
“I just like the spice and fruit character of Zinfandel. I’m always surprised by Zin because I find so much diversity of flavor in different Zins from different areas. As for Pinot, I just enjoy the fruit. I remember back in the 1970s and 1980s, most Pinot was planted in the wrong place and winemakers tried to manipulate the wine. Now they let the fruit dictate.”
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