Wednesday, March 07, 2007

Ernest Gallo: Passing of a Giant

Ernest Gallo, a true giant in Californian business and entrepreneurship, passed away yesterday.

Mr Gallo, who co-founded E&J Gallo Winery with his brother Julio 70 years ago, passed away at age 97.

Starting with $6,000 dollars and book on wine making from the local library he built the world's largest winery, which today produces over 62 million cases of wine each year.

Along the way, he pioneered many of today's standard business practices:

  • vendor managed inventory,
  • end cap product placement,
  • national sales forces;
  • brand advertising,
  • brand extensions;
  • modern distribution systems,
  • and, perhaps, most significantly, introduced wine to a country that only drank beer and hard liquor.
I once asked his son, the current CEO, why they use the Gallo name in their premium wines. He asked me, "how long do you think it will take consumers to see us a premium wine brand name?" I told him, "ten to twenty years." His response was telling - he said, "fine, we are not going anywhere."

In a valley that thinks in terms of months not decades and works to minimize time to exit, the Gallos are an amazing example of resiliency, vision, and multi-generational commitment to the business.

Mr Gallo was a great entrepreneur, pioneer, and Californian who will be sorely missed.

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