Looking to build a stellar wine collection?
Buying a Burgundy Grand Cru Pinot Noir like a DRC or a Bordeaux First Growth like Chateau Lafite Rothschild for personal consumption is one thing.
Buying it for investment purposes, though?
That’s a whole different ball game!
Make a few missteps, and your entire effort may turn sour!
So, how do you build a wine collection and turn it into a profitable investment?
In this article, we’ve rounded up all the essential tips to help you navigate the world of wine collecting. We’ll also introduce you to one of the easiest ways to invest in wine bottles in 2020.
This article contains:
(Click on the links below to jump to a specific section)
- Is there a Difference Between Buying Wine and Collecting Wine?
- How to Decide on Which Wines to Collect?
- 10 Essential Tips to Build a Wine Collection
- What Every Good Wine Collection Needs
- Resources to Help You Build a Great Wine Collection.
- Invest in Wine Bottles and Manage Your Wine Collection through Vinovest.
Let’s get this started.
Is there a Difference Between Buying and Collecting Wine?
When you buy a bottle of wine, you buy it specifically to drink it.
A wine collector collects wines that they hope will appreciate in value over time and can be sold for an enviable profit. They don’t necessarily purchase these wines with the intention of consuming them, although sometimes it can be a mixture of both.
How to Decide on Which Wines To Collect?
Remember, the core goal of building a great wine collection is to ultimately sell them for a profit later on. And, if a collector is looking to turn a profit from a bottle of wine, they need to carefully assess these factors:
Analyze the current retail price, historical price trends, and the auction history of the wines.
Why do particular vintage wines command higher prices?
Let’s use the Grand Cru wine bottle as an example. It’s expensive for two reasons:
1. The cost of making it: Includes the price of grapes, labor, the cost of growing each grape variety under stringent standards, and marketing costs.
2. The higher perceived value of vintage wines: The wine region, scarcity, novelty factors (like bottles salvaged from a shipwreck), and provenance can send wine prices skyrocketing.
B. Cellaring period and lifespan
A collector should know the cellar period or drinking window of wines. Great wines like Sauvignon Blanc are meant to be consumed in 1-3 years, while you can cellar many Cabernet Sauvignon bottles for 20-50+ years!
C. Provenance and pedigree
A collector needs to trace the wine bottle’s provenance (its source, life cycle, and storage) and pedigree (genetic characteristics), including the conditions under which it was shipped and the cellar conditions.
D. Other factors
Also, look into the:
- Vintage reports
- Tasting notes
- All details of the winery.
As you can see, building a profitable wine collection is not as straightforward as buying and storing expensive bottles in your wine cellar.
But don’t worry.
Here are all the tips to get you on the right track:
10 Essential Tips to Build a Wine Collection
Here are some tips to help you build a wine collection:
1. Assess your disposable income and budget
Buying a wine bottle isn’t the only cost you’ll incur. You need to invest in proper wine storage, insurance, and expert consultation fees. Make sure you have all these costs in mind when purchasing wines.
2. Find a Trusted Source
Do you prefer to buy from an auction house, a trusted wine cellar, or from an online merchant? In any case, make sure there are experts who vet the authenticity of the bottles.
3. Check the packaging
Packaging will affect the longevity of wine.
For example, wine bottles with a longer natural cork will taste and age better than one with a shorter or synthetic cork - as the bottle will stay air-tight.
4. Insure your wines
Protect your entire collection with an insurance policy that covers breakage, natural disasters, and theft.
5. Keep track of your wine collection
Keep track of each bottle, which wine cellar it’s stored in, which bottles were opened, and tasting dates with detailed tasting notes.
6. Have a balanced mix of vintages and prices
Ideally, a new collector should aim at a balanced mix of prices, young red and whites as well as some mature wine or older vintages. You might consider adding a vintage champagne or sparkling wine to your portfolio too!
7. Beware of counterfeit wines
Beware of counterfeit versions of collectible wines. Get professional help to spot tell-tale signs on labels, corks, and even sediments in older wines.
8. Have all the documentation in place
Catalog all the original documents - purchase receipts, auction catalogs, seller details. Take pictures and jot down the vintage year and initial condition of the bottle.
9. Assess and appraise your wine collection frequently
Your tastes may evolve with age. So, assess your collection periodically. Also, get a professional to appraise your wine collection routinely and maintain a cellar log book.
10. Know how to resell your wine bottles
There are plenty of avenues to resell your wines to wine lovers and collectors such as an online auction, or a wine exchange.
What Every Good Wine Collection Needs
Expensive wines need to be handled delicately and stored in a wine cellar with care.
Here’s what you need to invest in:
A. Proper storage
Cellar wine in poor conditions and it will degrade quickly and become unfit for resale.
Invest in a good wine cellar or a compressor-based wine fridge to maintain the right temperature, humidity, and pressure. An easier option is to cellar your wines with a professional cellar facility.
B. Serving instruments
While turning a profit from wines is great, some celebrations call for tasting them too!
But as these are such precious wines, they need to be handled with care:
Use the right glassware to serve your red or white wine and dessert wines to a fellow wine enthusiast. Unlike sweet wines, you should serve red wine in wider, rounder glasses to release it’s aroma.
Get a decanter to settle the sediments before you serve good wine. Buy a simple double-hinged corkscrew with a good knife on it. And, a good stopper like the one you’d use on a Champagne or sparkling wine bottle.
Resources to Help You Build a Great Wine Collection
There are plenty of online resources to help a collector build profitable wine collections.
- Use cellar tracking systems and wine investment apps to manage your collector portfolio.
- Use Liv-Ex and auction websites to track market data.
- Check vintage score guides for updated vintage scores.
- Meet collectors and exchange tasting notes at an auction, a tasting room, or at forums like the Napa Valley Forum. Attend private sales and a wine tasting or two at wineries.
- Get personalized services from a wine expert to improve your collection and discover new collectible wines.
- Network with sommeliers, winery owners, and other industry experts.
- Go through wine-related books and podcasts to sharpen your wine collecting strategies.
We know that all of this sounds like a very daunting task!
Luckily, there’s an easier way to manage all of this:
Invest in Wine Bottles and Manage Your Wine Collection through Vinovest
A wine investment company like Vinovest will let you invest in the steady-growth wine market, easily.
Vinovest will help you buy, cellar, and sell your wines.
You can even get your wines shipped to you to celebrate a special occasion!
How to invest in wine bottles through Vinovest
All you need to do is:
- Sign up on the Vinovest website.
- Share your risk appetite and investment preferences by answering a questionnaire.
- Add funds to your account.
Now, simply watch your wine collection grow over time!
What are the benefits of investing through Vinovest?
Vinovest chooses, authenticates, buys, stores, and sells investment-worthy wines for you.
1. Buy and sell wines easily
Vinovest offers an intelligent online platform letting you buy and sell wines at any time. You can also get bottles delivered to you if you wish.
2. Easily track your wine collection
You can easily track your portfolio and make changes using the simple, intuitive website.
3. Store wines perfectly
Your wines will be stored in a bonded wine cellar or warehouse under optimal conditions of light, humidity, vibration, and temperature.
4. Rest assured about provenance and authenticity
Vinovest traces the provenance and checks the authenticity of every single bottle of wine.
5. Avail of the best prices
Vinovest buys your wines directly from winemakers, wine merchants, and wine exchanges. So, you’re guaranteed the best wholesale prices.
6. Access an expert Wine Advisory Team
You get a carefully curated portfolio managed by a team of an Advanced Sommelier and three Master Sommeliers aided by Artificial Intelligence (AI)-driven investment models.
7. Leverage a deep seller network
You also get access to a deep wine industry network, besides being invited to limited releases of new wines and private winery sales.
8. Benefit from low overall costs
Apart from funding your account, the only other cost would be a 2.85% annual fee (2.5% for a portfolio above $50,000).
This fee includes buying your wines, authentication, storage, a full insurance policy at market value, portfolio management, and selling. You also get significant tax advantages because bonded warehouses don’t charge VAT or excise duty.
9. Own your wines
Unlike other investment options, you own the wines you buy through Vinovest!
Building a profitable collection of rare wines can be an overwhelming process.
But if you entrust the entire wine collecting process to an expert wine investment company like Vinovest, it becomes a breeze!
So why not sign up now, and start building your fine wine collection right away?