Tumwater Vineyard reveals alcohol economy's 'dirty little secret'
Oregon City Business Alliance's latest monthly forum, held in the Grand Ballroom of the Abernethy Center, focused on the "Economics of Alcohol" by giving spotlight to three businesses in Clackamas County.
Rather than produce alcohol for sale by a large corporate entity, which has been the predominant alcohol-brewing economic model for hundreds of years, these Clackamas County businesses use a small-scale, relationship-focused model that provides access to the production facility and sells directly to consumers.
Gordon Root, a partner at Tumwater Vineyard's winery, tasting room and event center across from the Oregon Golf Club near West Linn, kicked off the forum. Neither Root nor his business partner, Rick Waible, had a background in agriculture or winemaking. In fact, Gordon Root refers to the partners as "accidental winemakers."
Root and Waible intended to build 41 homes on a 63-acre site. When new legislation went into effect, they were left with 43 unbuildable acres — and no idea what to do with them.
"We decided to take out all the overgrown Christmas trees, amazing Scotch broom, blackberries and plant a vineyard," Root said.
But realizing through conversations with others that they couldn't make any money growing grapes, they came upon the idea of having a tasting room and selling wine.
To make money, they figured out they needed two things — a great venue and fantastic wines.
What do you do when you're just two guys who want to start a winery and don't know anything about starting a winery?
"What we did is we went out and hired some French people," Root said.
Laurent Montalieu is the vineyard's award-winning winemaker, and Pascale King as general manager runs Tumwater's barrelhouse among other things.
"You know how to become a millionaire in the wine business," said Root, "better start with five or six (million dollars). Because it is a very long-term investment in order to start receiving your yields. As farmers, we are very subject to Mother Nature."
Besides needing a lot of capital just to get a vineyard off the ground, you need to be able to sustain it throughout the early non-producing years.
"In the wine business you have to have incredible amounts of inventory," said Root, "If you plant young vines — which are six months old — you wait five years for your fruit. Then you harvest it, bottle it and wait for anywhere between one and four years to go ahead and serve it."
Besides the land, the planting, the waiting and the bottling, there's selling.
"The dirty little secret here is that it costs about $12.50 a bottle to grow, harvest and put the wine into the bottle, with the bottle, the label, the capsule and the cork," Root said. "Other than that, it all becomes taste — it's important because it determines what that $12.50 is worth."
Tumwater's wines sell at price points between $25 and $65 a bottle.
OC Brewing Company
Next up was Oregon City Brewing's Bryce Morrow, who owns a craft brewery with his father-in-law.
"We started this business really as a homebrew hobby," Morrow said, "5 gallons at a time on the stovetop in my kitchen. We had heated floors in my bathroom that was right adjacent to the kitchen we used to use that for fermenting with the glass carboys — eventually my wife kicked us out of there. Then we moved to another place that we dedicated a detached garage for our brewery, and then the rest was history."
Since November 2014, at 1401 Washington St., Oregon City, Morrow has been a taproom unto to his own.
"Our connection here, when we thought about where we were going to place our brewery, there was really no question it was going to be Oregon City — the name of the brewery is Oregon City Brewing — so, we're committed."
According to the Brewer's Association, the definition of a craft brewer is a brewery with an annual production of 6 million barrels or less — only one brewer in the U.S. gets close to that — Sam Adams.
"We're gonna do about 1,200 barrels this year," said Morrow, "6 million barrels is more than every single brewery in the state of Oregon combined."
But there are benefits to having those 1,200 barrels produced in Oregon City.
"I think the biggest benefit," Morrow said, "is the revitalization of small towns and main streets. It's been a real multiplier to gather people together and to revitalize different districts and to repurpose old buildings."
Morrow said selling direct to consumers allows the breweries to control their customers' experience and the quality of products being served.
"It's hard to do two things really, really well," said Morrow, "to really execute on the food and the beer — and certainly at scale — it can be challenging."
Oregon City Brewing doesn't offer food, but Oregonians have a way of working things out.
"One thing you'll see is kind of an evolution of the brew-pub model," he said, "in that we have 10 different food vendors onsite. Nine different, permanent food carts and one micro-kitchen. People can gather over food and drink and I think that's a compelling thing that will always be viable."
12 Bridge Ciderworks
Closing out the forum brought Jeff Jarrett of 12 Bridge Ciderworks, a former homebrewer of a different sort, into the forefront.
"I decided, maybe my new hobby should be trying to figure out how to make cider," said Jarrett, "so, flash forward, I went to the homebrew store, got some stuff, and my first batch was terrible. I miscalculated my recipe. I ended up inadvertently making a 12% cider, which tasted terrible… Of the five gallons, I think I dumped 4 gallons down the drain, I bottled maybe six 22-ounce bottles, stuck them in my pantry and forgot about them and then went on to my second batch."
Humble beginnings, to be sure. But, as with most stories of success, the process begins with time and interest in a subject.
"I loved the science part of it. I was fascinated by that," Jarrett said, "so I went and started buying books and going online and just kind of escalating. About a year later I stumbled across my first bottles in the pantry, probably ready to explode. I was like, I'm going to see what that tastes like. Maybe it's better or maybe it's going to kill me, I don't know. I grabbed the bottle and drank it. It wasn't terrible. Nobody would really pay to drink it, but it was actually a somewhat decent cider. Cider is kind of like wine. It ages better over time, to an extent, maybe not the shelf life of a wine, but it is like a wine in that way."
After about five years making his homebrew and perfecting his skills as a cider brewer, Jarrett began looking into the business side of things. He took a class through Oregon State University on the brewing business, wrote a business plan and found a spot in Oregon City to locate his business, 19376 Molalla Ave., #130. They've been there five years now. "There's not a lot of cideries," Jarrett said. "But you won't find demand as you do here, because the Northwest is one of the apple capital producing places in the world so, naturally, we want to ferment it and drink it. A lot of places have closed, but a lot of places have survived, and that's cool to me; the healthier the craft industry, the better for everybody."
The taproom, or tasting room, provides a place where customers can interact with the brewer or the winemaker. A place where they can get a feel for your brand, a taste of your brand, meet you, the maker.
"That's what a lot of what people are looking for," Jarrett said. "The people who like craft industries like to be able to go and see where the beer's made or where the cider's made, where the wine's made. And that's the fun part for me as a maker. Our production space is right behind a cyclone fence, so you can see me back there falling around and doing a little bit of work. And I like, when I go to a brewery, if I can see that, even if I'm not sure what's going on. It's cool to look at the shiny tanks, (and say), 'Oh hey, this IPA was made right there, and that's what I patterned my space after.' I think it makes it more interactive, more interesting."
"I will need to find extra capacity and space." Jarrett said, thinking toward the future. "I want to stay in Oregon City."
But that may not be easy for Jarrett, who said Oregon City lacks the flex space, or open-concept spaces that amount to four walls and a cement floor, making the space easy to build out for any purpose. Jarrett, and others like him, need these spaces to continue making Oregon City their home.
"There are a lot of really cool older buildings — like I love OCB's building, but there are very few of those buildings that would work," Jarrett said. "I don't want to retrofit and put a ton of money into getting a space up to code, up to what I need — the flex industrial space is appealing to me… I also don't want to lose the coolness of the unique space."
The Oregon City Business Alliance forum wrapped up with a question-and-answer period and a raffle, drawn by Clackamas County Commissioner Sonya Fischer, who spoke briefly on what the county is doing to embrace agritourism.
"Through our Economic Development Department in Clackamas County, we absolutely focus on agricultural industries," Fischer said. "It's in the ground, it's grown, it's harvested and manufactured and it really, you can just feel the vitality of what this brings to our community."
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