The Ins and Outs of Buying Wine at Auction
A Q&A with Old & Rare Wine Expert Scott Shulsinger
Scott Shulsinger wasn’t born into the wine business. Instead he honed his palate and knowledge of the world’s most rare and collectible wines by inspecting private cellars from coast to coast. His sneak peeks into incredible collections (and tens of thousands of miles on the road) let Scott see and taste incredible wines while becoming an expert on which bottles deliver significant ROI… while learning first hand which practices might disappoint collectors and wine enthusiasts down the line.
Now one of K&L’s resident fine and rare wine specialists, Scott illuminates the occasionally murky waters of collecting and selling rare wines for clients whether they’re searching for a special vintage of Bordeaux or looking to grab new releases from Napa’s cult Cabernet Sauvignon producers. At K&L, we’ve been around the auction block many times and thrilled to have the expertise of Scott and our entire team of fine and rare wine specialists to run our auctions.
This week, we sat down with Scott to get his advice on everything from where to start collecting to ensuring the provenance of special bottles, plus which bottles he can’t wait to open from his own collection. Read on for his insights, and be sure to check out our up-to-the-minute Auctions page to boost your collection.
K&L: How did you find your way into the old and rare wine business?
Scott Shulsinger (SS): I'm from Oregon originally, and came to San Francisco in 2000 to work on a master's degree in English literature. Just for fun, I started working in restaurants. One of the first places I worked had a really good wine list, and the manager was super enthusiastic and just started teaching us about wine. We started tasting California wines specifically, and that really got me interested in everything about wine.
Eventually, after leaving that restaurant and working at several others, I abandoned my master’s degree and started working at a company that provided full-service storage for collectors. As part of that I started doing on-site cellar inventories, traveling around the country, visiting clients, and going through their cellars. We would generally advise them on what they should sell and buy and estimate the overall values of their collections, which is really how I got into the world of collectors and rare wines.
K&L: What a job! After seeing so many collections, what advice would you give to someone starting a collection?
SS: Choose your wines carefully. If you're collecting for investment purposes, you really want to buy wines that have some sort of critical consensus, with the major critics putting out similar scores. Most importantly, you want wines that critics have scored because those are the wines that have the most life in the secondary market.
In terms of building a valuable collection, I recommend focusing on major brands from important regions. I think it's easy to get distracted if you're building a collection and just get carried away buying the wines you love to drink. Those bottles are great, but in terms of investing, you need to think somewhat strategically, and focus on acquiring the more collectible wines from places like Napa, Bordeaux, Tuscany, the Southern Rhône, or other prominent regions that have critical reviews.
K&L: So critical reviews are directly linked to most wines’ resale value?
SS: Exactly. There's so much wine out there to choose from, it's pretty easy to find wines that you're excited and passionate about that also have a footprint in the critical world. And that's the great thing about wine collecting now—there's just so much information out there. There's no longer one major critic that drives the entire industry, there are dozens of critics that specialize in every possible region. So it's really wide open, you can find a critic that suits your taste and get a broader sense of what a wine is worth and how it might age.
I've seen a lot of cellars where people bought cases from their favorite winery, and the bottles were forgotten, and those wines are much tougher to sell than something like Beaucastel from Châteauneuf-du-Pape or Chateau Montelena.
K&L: OK, so for collecting we should start with wines that have an established reputation, but what about buying wines? How should folks start purchasing at auction?
SS: You’ve got to have fun with it, and I really recommend playing around on the K&L site. It can be fun to compete with other bidders.
I recommend starting by figuring out the right time to bid. You don't want to start too early and you don't want to start bidding on an auction lot too late. So the best thing to do if you find a specific wine you're interested in, is to track it online through K&L. You just sign up for an email alert and then you’ll see how many other bidders there are, plus get a sense of the prices and best time to bid to win the lot.
K&L: What other tips or tricks do you have for buyers navigating K&L’s auction lots?
SS: The K&L auction site is great. There are new auction lots going up daily, and it’s pretty fluid. Each auction lot runs for seven days, so if you find something you're excited about, there’s time to see what the activity is like. And that activity–which the email alerts will show–indicates how much competition there will be for a specific auction lot, and how much you might want to bid.
K&L: What red flags should buyers know about, especially when shopping for wine at auction?
SS: Provenance is always the most important thing when you’re buying—or selling—on the secondary market. Number one, you want to make sure that the wines have been properly stored in temperature-controlled conditions. And secondly, you want to look for indications that the previous owner might have bought the wine directly from the winery.
K&L: What might indicate that a bottle was winery-direct? Receipts?
SS: It really depends how meticulous the collectors and previous owners have been. Most people don't have receipts, and will just tell you if they bought something directly from the winery. Wines in their original wood cases can generate a better return at auction and might indicate that a wine has been well taken care of.
I also think overall condition is a key thing to look into. For example, does the bottle you're interested in buying have a good fill level? Is the color of the wine good? What’s the condition of the capsule? All of those little details are really important because they indicate if the wine inside is still good—which matters whether you’re buying the wine to open and enjoy it or to possibly resell yourself later on.
And to be honest, all of these conditions vary from region to region. California wines are a little easier to verify while older Burgundy and Bordeaux can be more of a roll of the dice in terms of how the wine aged and was stored.
K&L: Wow, that sounds like a lot to look at. Does the K&L team inspect potential auction lots for provenance or is the due diligence up to each buyer?
SS: We always do our best to ask those questions—and get the answers—before anything goes up for sale.
When a request for a quote comes in, we start by asking where the wine has been stored and how the collector stored it. And really, we're always checking to make sure that the wine was stored in a temperature-controlled cellar or a professional storage facility.
The next step happens once the wine arrives at our warehouse, where our operations team conducts a careful inspection. They make sure that any condition issues are noted, so that our buyers are aware of the exact condition of a specific bottle. So we're looking at every single bottle and we're making sure that everything is carefully described. For example, it’s quite common to see bottles with a torn label or low fill, or maybe missing a foil capsule, but those little idiosyncrasies are always noted on the lot so there’s never a surprise for the buyers.
K&L: That sounds like a really in-depth process. Does K&L do anything else differently than other auction houses?
SS: It definitely is, and K&L’s location is important too. Being located in the Bay area, so close to Napa Valley and other major American wine regions, the wines travel a very short distance to get to us. That’s really significant because shipping can sometimes do irreparable damage to wines, and we’re able to limit that.
Our location also allows us to pick up cellars locally, and there are quite a few collectors in the greater Bay area from Sacramento to San Jose. Plus we also have auction experts in Los Angeles who can verify and pick up cellars in southern California. I think that's something that is not within range for the bigger auction companies in the northeast and the Midwest, who have to ship everything across the country. I think it’s great that we’re more hands-on and can move faster.
K&L: Last but not least, what’s in your collection that you can’t wait to drink?
SS: Oh man, well I'm a big enthusiast of Oregon Pinots and also the Northern Rhône, so I have a few bottles from both regions. My cellar certainly isn’t on par with the collections of our clients, but I have a 1997 Altesino Montosoli Brunello that I can’t wait to open and a 1990 Jaboulet Hermitage La Chapelle that I’m saving. Those wines last quite a long time, and I really think the biggest challenge is choosing when to open them.
To learn more about our team, Scott, and K&L auctions click here.