When Brian Heath and Jennifer purchased Grape Creek Winery in 2006, it was an anchor in a tiny regional industry that produced 2,000 cases of wine per year. Today, Grape Creek has grown along with the industry and the number is north of 75,000 cases, not including Heath’s other wine ventures. He recently told a crowd of Fredericksburg leaders he’ll continue to invest in this Texas wine region as it shows huge promise.
Heath was a head sales leader for Ameriprise Financial. “My connection to understanding the economy and business was forged in that environment,” says Heath who has a command of the industry’s Xs and Os like few others.
Grape Creek Vineyards was the first winery on the Highway 290 Corridor. Brian and Jennifer Heath added Heath Sparkling Wines on the Grape Creek grounds, added robust Cabernet and Pinot lineups with their Jenblossom Cellars, and have purchased two more wineries in 18 months. Invention Vineyards is on a scenic spot south of Fredericksburg, and Kuhlman Cellars near Hye.
“We’re committed to the Texas wine industry and Texas grape growers. But we also learn a lot by traveling to other wineries, from Napa, to Temecula (California), to Saint-Émilion, France,” he says. “Our whole goal is to see what the successful wineries do. The favorite phrase I ever heard was from Phillipe, the wine director at Chateau Beychevelle, who said, ‘Making wine isn’t that difficult — it’s just the first 200 years that are a problem.’ So we’ve still got some ground to go here locally.”
While the Texas Hill Country has seen a bit of a spending slowdown, Heath says, “It’s a business cycle, not a business forever.” And he has faith that the people will keep coming as the wine region is within an hour-and-a-half drive for five million people in Austin and San Antonio metro areas. He said Napa’s wine valley grew to 3.8 million visitors annually through its robust grape-growing. But the Temecula region has grown to 3.2 million visitors largely through its proximity to 20 million people within a 2-hour drive.
And the Fredericksburg region has seen its share of winery growth. In 2015, Heath says, there were 27 unique winery permits in Gillespie County. In December of 2023, there were 73. “I don’t know if it’s really saturated; I can’t tell,” he says, acknowledging there will be more. “I don’t mind seeing California wineries coming in, but I would like to see them plant vineyards and grow Texas wine.”
And so will other businesses. “Dining, shopping, transportation, lodging — it becomes symbiotic,” he says. “The only reason the wine industry exists in this area is because the town of Fredericksburg did such a great job of creating interest and tourism over time. It’s now the wine industry’s turn to give back.”
He points to winery visitors being typically higher on the socio-economic scale. He points to custom wine services industries popping up. But Heath says even more growth is on the way, so he’s investing here. “Jennifer and I have looked in California and actually had a contract on a piece of land in Temecula,” he says. “But it was eye-opening (with taxation rules).” Texas is more laisse faire but the downside in a low-regulatory environment can make for a seeming free-for-all. It is still the better alternative to him. But he adds that’s all part of the early growth phase for this wine region.
Heath and other regional wineries have also grown their direct-to-consumer business. Since small wineries can’t get into the big box store model, they put resources into growing the subscription or wine member model, and they invested in their grounds and exclusive clubs. What used to be 15% of many wineries’ revenue approaches 60% for some.
And Heath changed the “rules” to appeal to his high-margin customers — putting quality experiences over visitation measured strictly by quantity. “People with bad manners like chaos. We decided to create an environment that our best customers wanted. We eliminated busses and large tour groups. During Covid, we went to no kids and no dogs, because of the six-foot separation model. We thought it’s dumb to make our members stand in line while non-members are sitting at a table.” And it took hold, with substantially increased membership.
Other wineries filled the void of those who were turned away. “I actually like that there’s a place for them to go,” he says. “It’s one of the things I love about America and the free enterprise system.”
Heath even appreciates Fredericksburg having tighter regulations for its Main Street businesses. “If we didn’t have signage rules and the chain limitations, we would look like every other town in Texas,” he says. “It creates something that isn’t diluted and isn’t limited. Fredericksburg is a jewel. People come from all over the state to visit our Convention and Visitor Bureau to ask, ‘How did you do this?’”
And that has Heath all in on the Texas wine industry.