Calaveras Vineyards

Calaveras Vineyards is located in Alameda Valley, California with a total of 220 acres, 175 of which the vineyards occupy. The vineyard was established in 1883 to provide wine for the Catholic Church. By 1950 the production also included table wines. The vineyard remained in the original owner's family until 1986. Since 1986 the vineyard has been sold two times. The last buyer was Stout PLC, a British conglomerate, who has decided to sell Calaveras as part of a drive to focus on large, well-know wine and spirits brands. Dr. Lynna Martinez, the present Vice President will purchase 85% and Peter Newsome, the Operations Manager will purchase the remaining 15%, both continuing in their present capacity.

Product, Marketing, and Competition

Presently Calaveras products can be broken down into five main categories: Estate wines, Selected-vineyards wines, California wines, Generic wines, and Special-accounts wines. There are seven varietal grapes grown in the vineyard. Calaveras' good brand image and market position has been achieved through quality control, market segmentation, and capital improvements. Due to the controls and improvement the average wholesale price has grown from $29.52 in 1989 to $44.26 in 1993, a 151% increase. Approximately two-thirds of cases sales are made though its wholesale-distribution network, with the remaining cases sold to special commercial accounts. No changes in distribution are planned.

Calaveras market strategy to move from the bulk-wine sales into the premium-brand market has been successful largely due Dr. Lynna Martinez. The new market concentration is to implement cautious price increase and develop special-accounts segment to fully use wines of lesser quality. Upon acquisition of the vineyard, Winston-Fendall will take over marketing of the company and will treat as its flagship. In addition to handling the marketing, Winston-Fendall will provide collection and will pay Calaveras any receivables left unpaid after...