Forever a champion of inexpensive wine, Fred Franzia died early Tuesday morning at his home in Denair, Calif. Franzia was the nephew of Ernest Gallo, founder of E&J Gallo Winery, and son of a founder of Franzia Brothers Winery, which was later sold to Coca-Cola and popularized boxed wines. In 1973, Franzia decided to start his own wine company with a few relatives and founded Bronco Wine Co.
Bronco set out to acquire huge areas of land (30,000 acres of vineyards) and used this massive scale to help keep costs low. But selling the iconic Charles Shaw wine, or “Two-Buck Chuck,” for $1.99 plus tax required more than scale. So how did they offer this stuff so cheap?
Well first let’s talk about the name. Franzia picked up the Charles Shaw wine label when its owner, Charles F. Shaw, filed for bankruptcy. The grapes that go into Two Buck Chuck are grown in the San Joaquin Valley in California — which is cheaper than growing in Boujee Napa and Sonoma — and they age the wine using oak chips rather than oak barrels. The wine is harvested and produced using bulk machinery versus human labor and the the packaging material uses lighter bottles and cartons to decrease shipping costs. The natural cork is one of the cheapest available on the market as well. They thought about plastic corks, which would also help with price, but decided against it since they thought it would impact the taste and consumer perception. But the biggest reason they are able to keep costs down is volume. Those 30,000 acres can produce A LOT of juice and these economies of scale drive down costs considerably. Bronco makes an impressive 90M+ gallons of wine a year.
While Franzia’s approach to low-cost wine was not without controversy — pleading guilty to criminal charges surrounding false advertising of the quality of Bronco’s grapes and paying $55 million in a class action settlement — he was devoted to making wine accessible to everyone. Franzia was well known for doing blind tastings of his $2 wine against $10 wines and stating if you can’t tell the difference, why pay the difference? Consumers agreed, making Charles Shaw’s Two Buck Chuck one of the best selling items in Trader Joe’s history, with over a billion (with a “B”) bottles sold.
Franzia is survived by his five children, fourteen grandchildren, his three siblings, Joseph S. Franzia, Joellen D’Ercole, and Catherine McFadden.
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