Two Buck Chuck takes a bite out of Napa

By Joel Stein, Business 2.0 Magazine

When I ask if he's tempted to build a pretty little winery in Napa with tours and gardens and a tasting room and move into a nice house - instead of a trailer in the middle of a giant field near absolutely nothing, surrounded by barbed wire and pimpled with cement wine tanks slightly bigger than the coolers on a nuclear reactor - he ends this line of inquiry with his second favorite phrase: "Who do I have to impress? Is it going to make you happier to interview me in Napa?" When I inform him that, hell yes, I would be a lot happier to be in Napa, he shakes his head in dismay: "Come on, Joel. This is real life."

This "real life" phrase comes up constantly, second only to the wars. Real life is that hawk, or the tractor trailer that split in two from the weight of grapes. When I bend down, as instructed, to pick up a gopher skull amid a huge pile of bones outside an owl house built to keep rodents away, those bones are real life. Real life, I quickly learn, is anything except what you would do in Napa.

The people who live in the county of fake life aren't fond of Franzia. In 2004, when the company was named winery of the year for the second year in a row at the Unified Wine and Grape Symposium, the entire room groaned in displeasure.

At a dinner for Napa grape growers in 2005, attendees even broke out in a chant: "Kick Bronco's butt!" This is partly because of a long legal battle that Napa growers have waged against the company. A law requiring wines labeled "Napa Valley" to contain, by volume, 85 percent grapes from that area had a loophole grandfathering in brands from before July 7, 1986, when the regulation was passed. So Franzia bought up three wineries with the word "Napa" in them that were founded before 1986. Napa got the loophole removed. Franzia sued. The Supreme Court last year declined to hear the case.

While many winemakers say they hate Franzia because he's a bully or because he's crude or because he operates close to one side or another of the law, Franzia believes it's because he exposes their pretentiousness. "Sniff it and smell it and taste the inner body," he says, scoffing. "They're trying to confuse the consumer. You either like it or you don't like it. You shouldn't make them feel like second-class citizens. I love to sell something you don't have to give an excuse for."

The text on the back of Franzia's Three Knights chardonnay label, after a story about two brothers and a cousin who crusade on behalf of the people, delivers a brilliant parody of vintner-speak, cramming together words like "notes" and "mid-palate" and "melon" nearly nonsensically.

"A lot of people object to Fred because of jealousy, a lot of people object to him because of his business practice - which is, simply, if the law says I can do this, I'm going to do this to the fullest extent," says Michael Mondavi, founder of Folio Fine Wine Partners and a close friend of Franzia's who went to high school and Santa Clara University with him. And, Mondavi believes, they mostly hate him because his company scares the crap out of them: "When Fred built a bottling plant in Napa, everyone's great fear of the San Joaquin Valley invading Napa Valley mushroomed."

According to Mondavi, San Joaquin grapes had improved tremendously in the 1990s - especially when unpopular, harsh grapes such as carignan were replaced with cabernet sauvignon and merlot - and Franzia was using real winemaking techniques on them. That, coupled with Franzia's very un-Napa crudeness, made him highly unpopular in wine country.

While the crudeness seems like a put-on meant to test opponents, it's still startling. He's a giant, 62-year-old former high school football player who looks like a cross between John Madden and Shrek, and he utters very few sentences that don't contain at least one curse word.

When we go to lunch at the Farmer's Den, a cheap joint down the road from Bronco where Franzia eats four or five times a week, he greets our scoop-necked T-shirted waitress Whitney - the owner's daughter - with "Why you hanging them out like that, like the other girls? Is your dad not around?" She blows this off with "Whatever, Fred. You always have something to say."

Later, when he's showing off his collection of 187 flags, he requests one from Swaziland by telling a guard to "put up the spear-chucker flag." This would probably not go over well in Napa - or anywhere after 1960. And remember, this is how he talks when someone is following him around with a notebook.

Although Franzia is unapologetically blunt, his partners tell me they never get in fights with him. While older brother Joe avoids the press, he interrupts his one-word answers to tell me that Fred never bullies his inner circle. "If we can't get to a decision, we table it," Fred explains. "Everyone then comes back with new ideas. If we can't agree then, we table it. If we don't agree the next time, we never bring it up again."

Franzia works 100 hours a week and never takes vacations - and there aren't many slackers at Bronco. When I meet Franzia on a Saturday, Bronco's inner circle is deep in a meeting. That morning they all interviewed a salesman who made the crucial mistake of mentioning that he's physically active. "When does the guy work? He golfs and plays baseball," Fred says, laughing. "We faked it for 10 minutes and then kicked him out."

While he expects a lot, Franzia is known for listening to his employees, even if he has to berate them into talking. "The thing we do better than anyone is we listen," Franzia says. And despite Bronco's size, he's still willing to take big risks.

As we speak, enormous swaths of his fields are being ripped up to switch from cabernet sauvignon and merlot vines to pinot noir and pinot grigio, which Franzia expects to be big sellers because they're easy to drink. "We don't admit we made a mistake by putting in cab. We're 'adjusting,'" he says. "You have to be aggressive. You have to be ahead of the curve. Today the bottom price of pinot noir is $60 a case, but we hope to plant enough to have it in Charles Shaw."

Franzia believes deeply that success comes in increments, from small adjustments. He built long, straight paths in his fields so that his tractors make fewer turns and wear tires out more slowly. He runs all his vines north to south so they get even sun exposure.

His next project in Napa doesn't involve pricey grapes, but rather the construction of a bottle factory that will adjoin his bottling plant - giving Bronco complete vertical integration and slashing costs even further. "Success is easy if you think of it like rust: It's inevitable if you keep at it. You look for magic moments, but they're not there," Franzia says. "Guys can claim they are, but that's bullshit."

He started the company in 1973, right after his dad sold the family wine company, started by Franzia's immigrant grandfather in San Joaquin Valley in 1915, to Coca-Cola (Charts). Franzia didn't speak to his dad for seven years after that, and he started up Bronco to compete with him.

Franzia has turned Bronco into a new family business, with 12 relatives on the payroll, but says he has no interest in buying the Franzia label (now owned by an unrelated winemaker that sells a sweet boxed wine popular for drinking games). "I think it's better not putting your name on it," he says. "Otherwise you get emotionally involved, like Mondavi, and it clogs your thinking."

Emotion doesn't clog much about Franzia. Still, a few things contradict his third most-used phrase: "All I care about is making money." Fronting his property are huge rows of pretty cypress trees, which he had planted after visiting Tuscany. And this house he's planning to build - a series of three houses, actually - will be right on a small artificial lake surrounded by fully grown trees he's been planting since 1987 in anticipation of the home. After telling me about this, he quickly adds, "Don't tell anybody. They'll think I'm going soft." Top of page

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.