Theo Lieberman drank a nice bottle of Champagne on election night. Normally, that wine would have sat in a restaurant like Eleven Madison Park or Per Se. Maybe it would have been included on the grower Champagne section of his own wine list at 232 Bleecker, where Lieberman is the beverage director.
Of course, these are not normal times. Since March 2020, constrained by a budget freeze, the wine inventory at 232 Bleecker has cratered from $90,000 to $16,000. Last fall, when a distributor presented Lieberman an opportunity to purchase several bottles of highly allocated Champagne, he couldn’t buy the wine for 232 Bleecker but was also reluctant to watch the bubbles recede into the ether of the three-tier alcohol distribution system. So, Lieberman bought the bottles for himself and popped one to celebrate the election.
“I’m not going to turn down an allocation on wine like that,” he says.
Wines become allocated when demand outstrips production. Distributors often have to divide cases or six packs between accounts. Allocated wines generally are pricey, but not always. A bottle of Domaine de la Romanée-Conti can set you back from $1,500 to $20,000, while Coenobium, a white wine made by nuns just north of Rome, costs $20 retail.
The wines are coveted. Traditionally, restaurants, particularly those with splashy wine programs, receive a significant share of the country’s allocated wines.
“Just because I want to spend $300 on a bottle for an anniversary or special occasion doesn’t mean I go to the [restaurant] cellar and get whatever I want.” —Theo Lieberman, 232 Bleecker
It’s not uncommon for sommeliers to buy wine for themselves, offer it to staff at cost or reserve a few bottles for friends. Until this year, to scoop up an allocation was something Lieberman wouldn’t have considered.
“There are certain things you don’t ask for,” he says. “Just because I want to spend $300 on a bottle for an anniversary or special occasion doesn’t mean I go to the [restaurant] cellar and get whatever I want,” he says. “As a wine director, I don’t buy the last bottle of anything.”
But restaurant closures and anemic on-premise sales have shifted standard distribution channels for allocated wines.
Union Square Hospitality Group, for example, suspended onsite dining at its 20-plus restaurants during the shutdown periods, and its beverage team passed on all allocations.
John Ragan, a master sommelier and the group’s vice president of operations, says the company is focusing on selling approachable, takeout-friendly wines from its existing inventory.
“We are using any dollars available to retain or rehire key personnel,” says Ragan. “It’s not a time to be spending on wine, but rather our people.”
As a result, retailers and other buyers, some of whom had blockbuster sales last year, have unprecedented access to allocated wines. If consumers know where to look, they will find them, too.
“If you love wine or want to get into wine, there’s no better time for you to buy than right now,” says Clara Dalzell, general manager and buyer at Flatiron Wines & Spirits, a New York City bottle shop that specializes in rare and allocated wines. “There are so many wines that would have a much higher mark-up in restaurants that are now available from retail stores. You can go in and have access to this next tier of quality, stuff that’s been harder to get or is available for the first time in quantity.”
The Byzantine world of allocated wines
Securing these coveted wines, even for restaurants and retail outlets, is often a murky business.
“If you wind up with any allocations all, it’s about how much money you spend, who your friends are, and what your previous allocations have been,” says Lieberman. Distributors are known to hold back wines to make them appear rarer. Or they can refuse to sell wines to certain clients in favor of placing them at sexier accounts.
Allocations may also come with strings attached.
“It’s never something written down in a contract,” says Walker Strangis, owner of Walker Wine Company in Los Angeles. “It’s just, wink-wink, nudge-nudge. ‘Maybe we can find another case of this if you can help us move other things.’ ”
His business focuses on old and rare wine acquisition and cellar building, but he had never purchased current-release allocations until 2020.
“Conversations are a lot more open and honest now,” says Strangis. “It’s like, ‘These wines are here. We need to move them. What are you interested in?’ ”
“It’s never something written down in a contract. It’s just, wink-wink, nudge-nudge. ‘Maybe we can find another case of this if you can help us move other things.’ ” —Walker Strangis, Walker Wine Company
Neil Rosen, a 20-year portfolio manager at Rosenthal Wine Merchant, hasn’t changed his approach to allocations much during the pandemic.
“We’re not strategic with our allocations,” he says. “We don’t try to leverage access to certain wines to do more business with people. That does a disservice to the wine, and our other wines [that] we think are just as wonderful.”
Last year, wines got stuck in Rosenthal’s inventory. “For me, it was nostalgic,” says Rosen. “People called about white Burgundy, and something was available that never would have been. It was cool because you could sell to someone who had never had the producers.”
That’s how Strangis got his hands on Domaine Henri et Gilles Buisson for his wine club.
“I would never have known about it,” he says. “It’s small-production. I can make a decent margin and turn my clients onto a wine that’s affordable, and they get to be part of the inner circle.”
Flatiron Wines is among the most adept players of NYC’s allocation game, along with shops like Chambers Street Wines, Astor Wines & Spirits, Crush Wines & Spirits and Le Dû’s Wines. The team at Flatiron works to secure allocations and identify quality producers whose wines are likely to be allocated.
“Take Anne-Sophie Dubois,” says Dalzell. “We could have her wines to our heart’s content. But after two seasons, we get cut. But we still get a lot, because we sell a lot. You’re securing your position early on.”
Since the start of the pandemic, Dalzell has received more allocated wines in greater quantities, including bottles that typically only go to restaurants. This means having to do less allocating of her own allocations.
Flatiron’s best customers get priority on certain rare wines that never make it into public view. But in the current climate, it’s been able to offer more allocated wines both online and on store shelves. Flatiron even features bottles like Willi Schaefer Riesling and Marcel Lapierre Beaujolais in its weekly newsletter.
“It’s been years since customers have gotten more than one chance to buy Lapierre,” says Dalzell. “But we got three different drops as restaurants shut down.”
Restaurants and retailers aim to adapt
Not every shop has Flatiron’s buying power, though. Todd Shannon, manager at Terry’s West Village Wines, purchased as much Burgundy as he could last fall.
“But it’s not like all of a sudden, I’m knee-deep in allocated products,” says Shannon, whose budget dried up during the spring and summer of last year, as his West Village clientele decamped from the city.
Several reps who sell wine to Shannon lost their jobs early in the pandemic and changed companies. “It’s a bit of a hiccup,” he says. “The people I’ve worked with for a long time, they think of me, but now I’m a line on a spreadsheet.”
Hannah Williams, beverage director of Blue Hill at Stone Barns, held onto her job throughout the pandemic, unlike a majority of her industry peers. With no guests, she spent weeks cleaning out and checking the inventory of her award-winning, two-star Michelin cellar.
As Blue Hill pivoted, she dabbled in retail. Williams sold a few bottles to collectors and repurposed much of her by-the-glass inventory to be paired with the restaurant’s resourcED to-go boxes. But Williams has largely been able to keep her cellar intact and buy new releases to age in it.
“There are wines we had never been able to get allocations of, even as Blue Hill,” she says. “For some historical allocations, there’s just a six pack, and you understand that Eleven Madison Park, Le Bernardin and certain people got them.”
Williams says she passed on her own allocations last year in March and April.
“For some of these restaurant-only wines, I called and said, ‘Not to be a vulture, but I’m wondering if this wine is being imported at this time.’ Distributors were quite willing, especially if we could use a wine at a lower price point, to have a conversation with me for the first time.”
Beyond blue-chip bottles, Williams also procured “all these really fun wines,” like Domaine Vacheron Sancerre and Benanti Pietra Marina Etna Bianco Superiore, to sell at Blue Hill’s outdoor dinner series.
“There are wines we had never been able to get allocations of… There’s just a six pack, and you understand that Eleven Madison Park, Le Bernardin and certain people got them.” —Hannah Williams, Blue Hill at Stone Barns
There’s still speculation that distributors are still holding back bottles for certain restaurants when they reopen. Rosen says that’s not the case with Rosenthal, though other distributors declined comment.
“Facing the void, not knowing where the economy was going and with half of our clients gone, we felt our duty was to remain solvent as a company,” says Rosen. “We’re not in a position to hold a bunch of stuff and see what happens. I didn’t think any restaurants would be mad that they missed out on an allocation in a pandemic. That’s the least of [their] worries. Most are liquidating cellars, anyway. I doubt any restaurant would say, ‘How dare you let it go?’ ”
Still, Williams says that she suspects that “we’ll see these gaps in wine lists with the 2018 vintage. It will be like, ‘Oh, that was the Covid year.’ ”
Rosen hopes that more allocated wines end up in home cellars, where they can age and be enjoyed in a less rarified setting. But to secure allocated wines, consumers must know what to ask for and how to navigate byzantine and somewhat shifty industry practices—or have a relationship with a buyer who can introduce them to sought-after bottles.
No one is certain how long this relaxing of allocations will last, when restaurants will return to pre-pandemic levels or what establishments will fill the bones of grand eateries killed off by Covid. It’s likely a blip, not so different from a booming harvest year that injects extra cases into the market.
“My perception is these allocations will go back to people who have had to step away for a time, and I will be the one who loses out,” says Strangis. “It’s like dating someone who’s out of your league. If I do lose access, I will have had a good opportunity to work on relationships with clients, and I’ll fight like hell, continue to ask, beg, plead and try to get them. But sometimes, a relationship has to end.”