The “Virtual” Winery vs The “Micro” Winery

Bend’s newest glossy mag has just published its first issue and we have a nice mention in it. They spelled our last name incorrectly and referred to us as a “virtual” winery, but you know what they say: All publicity is good publicity. So, we appreciate the nod.

But I do want to clear up this “virtual” vs “micro” winery topic. As both business models become more common throughout the wine industry, the distinction is becoming more defined and apparent.

The VIRTUAL Winery: Can be operated by someone living thousands of miles from the production site. They write the checks to a production facility which then handles the entire process – from sourcing grapes through the finished wine in the bottle. The owner can sometimes watch the progress of their wine via the web, and they can even visit on-site and participate in their wine production. Day to day involvement is absolutely unnecessary. In fact, any involvement beyond sending money is unnecessary. The Virtual Winery owner can be as involved or as detached as he or she wants to be.

The MICRO Winery: Run in basically the same way as a 100,000 case per year winery, except production facilities are contracted rather than owned. Producers may grow their own grapes, or source their own. We spent years finding and securing long term contracts with the best growers. Producers of Micro-Wineries have all the final wine-making decisions – yeasts, barrel program composition, blending, bottling issues – the whole shebang. Consultants may be used – just like the giant multi-national producers. But the responsibility for the full-cycle – from grape to wine in the bottle – rests solely with the producer.

You may have read recently that there is only one winery in Central Oregon. That is not true. There is one commercial wine production facility. Volcano Vineyards® is a licensed Oregon winery and the address on our license reads “Bend, Oregon.”

Sometimes it seems as though we are being penalized for not having the millions of dollars it takes to open our own winery facility. Well, we’re working on it. In the meantime, with debt up to our eyeballs, we have focused on the grapes that are producing wines that are winning awards across the U.S. including a gold medal for our 2004 syrah from the largest domestic wine competition in the country (the San Francisco Chronicle Wine Competition). So, have patience with us. We will have our very own production facility some day. And we seem to be off to a good start. But doing the production facility the right way – to allow us to produce wines of superior quality - will take time and funding. If we decided to do a commercial wine production facility on the cheap, we could have chosen to simply buy bulk wine, get it to Bend on a tanker truck, blend, then bottle it – a perfectly legitimate business model, but not the path we’ve taken.

I hope this clears things up and gives everyone a better idea of what we are doing.