Sonoma County wine, craft beer purveyors disrupted or closed due to coronavirus threat

The North Coast wine and craft beer industries scrambled Monday, the day after Gov. Gavin Newsom called for the closure of all tasting rooms, taprooms and bars statewide in an effort to curb spread of the coronavirus.

The move was an immediate economic jolt to Sonoma County’s signature wine industry, which directly and indirectly supports 54,000 local jobs with $3.2 billion a year in local workers’ wages, according to a study by Sonoma County Vintners, the sector’s main trade group.

The reverberations also hit the area’s burgeoning craft beer, cider and spirits sector. Except for Russian River Brewing Co. in Windsor and Santa Rosa, and Bear Republic in Rohnert Park, that both serve food, the other brewpubs closed. Russian River and Bear, however, each had to cut their dining capacity space in half to give customers wider social distance.

Sonoma County is home to more than ?425 wineries, with an estimated 300 that have permits to operate tasting rooms. There is also about 500 wineries in Napa County, more than 100 in Mendocino County and dozens in Lake County. Those on-site wine bars and lounges generate significant sales income for the wineries, but also serve as a magnet for visitors who come and shop, eat and sleep in the area and support an array of tourism-related businesses.

“We’re still in for some long days and nights ahead of us,” said Corey Beck, chief executive officer of Francis Ford Coppola Winery in Geyserville.

Newsom’s order does not restrict production of wine and beer or sale of either at stores and online, according to trade group officials representing the wine and beer industries. While many in administrative and sales roles are working remotely, those working in the vineyards, production areas and warehouses in the beverage sectors remain on their jobs - under protocols advised by state and local health officials.

The immediate effect of the governor’s sweeping order has been twofold. Many winery executives are trying to find work and tasks for their hospitality staff to keep them busy, so they would not have to be furloughed. In addition, they also were examining new ways to boost digital sales. The smaller wineries still rely heavily on tasting room sales, while the big wine companies Jackson Family Wines and E. J. Gallo Winery dominate supermarket shelves.

An added worry for vintners is people cutting back on dining out and traveling would reduce sales of wine at restaurants and hotels. Some wineries, such as Jordan Vineyard and Winery in Healdsburg, generate a large amount of their sales at restaurants and other on-premises accounts. For some it is more than half.

Coppola in Geyserville shut its tasting room and restaurant on Sunday and many of its employees are working from home, Beck said. The winery’s production space is still open though Beck said his management team was trying to stagger shifts for employees, especially those who are having child care challenges with schools closed.

The winery will cover pay for its hospitality employees for the short term while it looks to see what federal relief will emerge to help affected industries, Beck said.

Vintage Wine Estates, with a portfolio that includes B.R. Cohn Winery in Glen Ellen, Sonoma Coast Vineyards in Bodega Bay and Cosentino Winery in Napa, intends to transfer their hospitality staff for other duties such as telemarketing sales and the warehouse or bottling line, said Pat Roney, chief executive officer.

“We are going to try to take care of our employees,” Roney said.

Still, only 24 hours after the governor’s Sunday order, at least one local brewer - Russian River - furloughed nine workers because it halted brewery tours in Windsor and removed half of its food service capacity space to comply with the governor’s order.

“Our intention is to bring everyone back as soon as possible,” co-owner Natalie Cilurzo said, noting the displaced workers can use company sick and vacation pay and then seek state unemployment benefits.

Furthermore, in a move that underscores the magnitude of the economic fallout expected by the coronavirus, Russian River plans to cut its beer production in half because of all the bar and restaurant closures statewide.

As the business interruption took hold in the area’s wine and beer industries, U.S. Rep. Mike Thompson, D-St. Helena, said he spoke with winery executives about their plight. He said a House-passed bill awaiting Senate action would require employers to provide 14 days of paid sick leave during this public health emergency, as well as three months of paid family and medical leave. It would apply to those companies with 500 employees or less. House Democrats are planning further measures as well to help keep the economy afloat, Thompson said.

There is going to be a “major effort” in Congress to ensure workers and small businesses get financial help, Thompson said.

That would include Suzanne Hagins, who owns Horse & Plow winery and cidery in Sebastopol with her partner Chris Condos. The winery opened in 2008 and produces about 5,000 cases annually. Its tasting room attracts several hundred customers a week during high season. It also does business with restaurants, and Hagins was just notified on Monday of the closure of two East Bay restaurants that bought her wines. In further bad news, the winery was planning a party on Saturday for its wine club members with food and music to be provided.

“Those are some of our most important customers,” Hagins said of her wine club members. “We are reaching out, offering free shipping, offering free pickups and offering some discounts because everyone is feeling it.”

Over at Iron Horse Vineyards, CEO Joy Sterling said she will work with her sales team to find new avenues to spur more online sales after shutting the winery’s scenic outdoor tasting area that overlooks the Sebastopol hills.

One bright spot is that wine sales at supermarkets and wine stores are strong now as a result of recent panic buying, said Rob McMillan, senior vice president at Silicon Valley Bank’s wine division.

“Consumers will drink in good times and in stressful times,” McMillan said. “That’s what happened in Prohibition. That’s what happened in the Great Recession.”

That was the case for Rohnert Park resident Steve Wall during his Monday afternoon visit to Russian River’s Santa Rosa brewpub. Wall said it would be his last meal out for a while. He wanted to support local businesses before practicing more so-called “social distancing” - a space of at least 6 feet recommended by local, state and federal health officials to help reduce the spread of the coronavirus.

Some customers, though, were less concerned about going out to eat. Jamal Armstrong of Lodi, who stopped at Russian River while visiting Santa Rosa on Monday, said he wanted to strike a “balance between aware and going over the top,” noting as long as restaurants consistently clean tables and seat customers far enough apart he would keep going out.