I am always excited to receive the annual “Review of the Industry” issue of Wine Business Monthly because it is so jam-packed with data and analysis. The 2026 issue (which was distributed at the Unified Symposium’s State of the Industry Session) is especially welcome because it effectively captures major shifts in the U.S. wine industry today. Here are some key takeaways of the WBM report.
Disappearing Wineries
Winery openings often get a lot of attention. Winey closings, not so much. Doors close, equipment is sold off, inventory is quietly liquidated, and memories fade.
If it seems like the number of wines and wineries is always growing it is due in part to the fact that openings are so much more visible than closings. But new wineries enter the market and existing ones exit every year.
Winery closings were impossible to ignore in 2026, according to WBM. The total number of wineries in the U.S. declined by 3% from 11,450 in 2025 to 11,107 at the start of 2026. That’s a decrease in the net number since there are always some openings to offset closings. The winery count has fallen by 512 since the 2024 data were released according to WBM.
The drop in winery count is widespread. There are wineries in every U.S. state and there were winery closings in every state but one: Missouri (253 wineries). Among the states experiencing losses, California (which has the most wineries) experienced the largest drop in winery count, Pennsylvania had the lowest, with the number falling from 402 to 401 according to the WBM data.
Overall, about one winery closed its doors each day of the year in 2025. That’s a lot of wineries, but not necessarily a lot of wine simply because most wine is made by a few large wineries (see below) but most wineries are relatively small.
WBM also provides data for Canadian wineries. Canada can count 831 wineries in 2026, according to the WBM data, down from 860 in 2025. Wine is made in every region except the Yukon Territories. The largest number of producers are located in British Columbia (317 wineries down from 329 in 2025), Ontario (284 down from 292), and Quebec (163 down from 170).
Clash of the Titans
The largest U.S. wineries are very large indeed and many of them are privately owned and do not release production figures. WBM profiles the top 50 wineries and estimates production when published data are not available. I thought it would be interesting to compare 2026 data for the top five wineries with the numbers from 2025 and 2016. Here’s what I found.
- Gallo is #1 in 2026. It is the largest wine company in the U.S. and in the world by volume. Gallo produced an estimated 90 million cases of wine in 2026, down from 94 million in 2025 but higher than the 75 million it produced in 2016. Gallo’s portfolio grew when it acquired a host of wine brands from Constellation a few years ago. It has retrenched more recently and pivoted to other beverages such as the hot-selling High Noon vodka-based RTD brand.
- The Wine Group: 43 million cases in 2026, 40 million in 2025, but 57.5 million in 2016.
- Trinchero Family Estates: 17 million in 2026, 19 million in 2025. It was #5 with 18.5 million in 2016.
- Delicato Family Wines: 16 million cases in 2026, 16.3 million cases in 2025. It was #8 with 8 million cases in 2016.
- Deutsche Family Wine & Spirits: 12 million cases in 2026, #7 with 13 million cases in 2025. Not listed in the top 30 wineries in 2016.
The rest of the top ten for 2026: Jackson Family Wines (6), Treasury Wine Estates (7), Ste Michelle Wine Estates (8), Bronco Wine Company (9), WX Brands (100).
Constellation Brands, once the largest wine producer in the world, ranks #28 with 750,000 cases of wine produced. It was #3 with 50 million cases in 2016. Although it has retained a number of prestige wine brands such as Robert Mondavi, Constellation is now much more focused on its Mexican beer portfolio.
Bottom Line: The largest wineries are very large indeed, sell wines at many price points, and have considerable resources to deal with the current down market. But even they are not immune to the problems that plague the industry today. The fact that Gallo is down “only” 4 million cases in the last year sort of takes my breath away.
Distribution Bottleneck
It makes sense that WBM’s Review of the Industry issue includes an analysis of wine distributors. In my studies of different industries I have observed that there tends to be one or two major inefficiencies (I call them bottlenecks) in the value chain. Successful firms and even whole industries organize themselves around the problem of breaking through the bottleneck problem.
What’s the bottleneck in U.S. wine? It isn’t growing grapes or actually making the wine. It is getting it through the three-tier system into the hands of those who can sell it.
The two critical features of U.S. wine noted in the WBM report are, first, distribution remains highly concentrated in a few large firms and there is little top line change to report. Even though Republic National pulled out of California last year, for example, it still ranks as the #2 national wine distributor after Southern Glazer’s.
WBM reports that the distribution bottleneck is getting even narrower, driven by declining demand and narrowing margins. Retailers increasingly focus on a smaller number of SKUs that can generate reliable cash flow, which means that distributors must do the same.
As WBM reports, “… there are 1,061 unique wine distributors that operate across the United States. That’s slightly fewer than this time last year and roughly one-third of the number of wine distributors in business a few decades ago. … “It’s not a time for great variety, not a time to drive a thousand different things,” said Southern Glazer’s chief marketing and sales officer Gene Sullivan. “Customers are saying ‘Give me that stuff that matters.'”
Pareto and the 80/20 Rule
The great Italian economist Vilfredo Pareto observed the 80/20 phenomenon in 1896 and it has become a classic management principle reminding us to focus on what’s most important. The rule shows up in many ways. For example, according to my AI intern,
- Business: 80% of sales often come from 20% of customers.
- Productivity: 20% of your tasks produce 80% of your meaningful results.
- Customer service: 20% of issues generate 80% of complaints.
- Wealth distribution: Pareto originally observed that 20% of Italians owned 80% of the land.
The WBM report presents a variation on the 80/20 rule when it comes to distribution. Twenty percent of wines produce 80 percent of sales. The remaining 80 percent of wines face an uphill climb on their path to market. That’s not really new, to be honest (and maybe it is more like 90/10 in some cases) but it is maybe even more important now in a shrinking market.