Oregon Tasting Rooms Closing

Group retailers cite economic struggles, shipping woes

by Peter Mitham and Jane Firstenfeld
Vino 100
The Oregon Wine Tasting Room in Amity, Ore., served and sold wines from as many as 150 local wineries for nearly three decades. Now it's going out of business.
Amity, Ore.--Tasting rooms are a key to expanding markets and garnering new fans of rising wine regions, Patrick McElligott knows. As reported here yesterday, winery tasting rooms are proven builders of both sales and brand loyalty. But retailers marketing and serving tastes from many wineries may not be so fortunate in the current recession, as demonstrated by recent announcements that two innovative Oregon tasting rooms are going out of business this month.

McElligott is the soon-to-be former manager of the Oregon Wine Tasting Room (OWTR) in Amity, Ore., which will shut its doors June 22 after 29 years of helping to raise the profile and extend the distribution of many lesser-known Oregon wines. At its peak, it carried close to 300 wines from approximately 150 Oregon wineries, including those of parent company Amity Vineyards.

"We've had lots of wholesalers come through that have picked up on wineries they never knew about," McElligott told Wines & Vines. The variety of inventory made the tasting room an attractive destination for visitors of all kinds to the Willamette Valley, until the current recession reduced traffic and revenues to unsustainable levels.

McElligott also blamed the ever-changing chessboard of interstate direct shipping regulations for the closure. "It has a lot to do with not being able to ship wines without having to pay all these states' different fees if you want to be totally legal, plus sales tax," he observed.

"Because we sold other peoples' wines--even though we were a winery tasting room--we were told, for instance, if somebody from California bought wine, and they're standing in my tasting room, and I'm shipping it back to them, I'm supposed to charge California sales tax and get a retailers' license in California." Navigating the Byzantine labyrinth of state liquor and sales tax laws, he said, finally became more trouble than it was worth, and contributed to the decision to shut down.

Vino 100
Vino100 Portland offered retail sales, tastings and events like this wine tasting class for four years, before closing its doors this month.
Perhaps surprisingly, in the largely rural Willamette Valley, vehicular traffic also put a damper on the OWTR. In a situation similar to Napa Valley's notoriously congested Highway 29, "People keep opening wineries like crazy," McElligott said. Amity is south of Dundee, a wine country boomtown with a single traffic light and, he said, "plenty of waiting."

Traffic has been known to back up as far as Newberg, about 20 miles to the northeast, or even beyond on long weekends, he noted, making it a hassle for potential visitors to reach the tasting room. "It's like being in a city, McElligott said. "Most of those people just quit coming down on holiday weekends because it's just not worth their while."

Ironically, visitors from Portland, the nearest large city, simultaneously lost a local vinous venue. Vino100 Portland announced it would close permanently after four years in business. The owners blamed "a combination of devastating industry conditions and ongoing economic difficulties" for the failure.

Vino100 Portland offered retail bottle sales, wines by the glass, complimentary wine tastings Fridays and Saturdays and private events. Its website had promised visitors "limited production, artisan crafted wines at affordable prices. Vino100 will always carry at least 100 wines that are $25 or less a bottle." A business liquidation sale began on June 2 and the business closed for good on June 6.
Posted on 06.15.2009 - 11:48:27 PST
The loss of the Oregon Tasting Room is especially painful. This was the best example of a unique outlet to showcase and provide small, boutique wines, otherwise lacking their own tasting room, or too small to afford distributors and state license fees elsewhere than Oregon. The Oregon trade board, etc. other statewide interests should have been more "on the ball" to support and maintain this valuable representative of Oregon wine excellence. Also, Patrick McElligott was an equally valuable educator and promoter for these otherwise unknown and unrecognized wineries. Patrick is widely known and appreciated for his tasting/judging skills and ability to teach wine knowledge. He will do well now, representing a single winery combine, but it's a loss to not have him representing the entire Oregon wine industry.
Port Townsend, WA USA