Capillarity and Rate of Sale

Next time a winery tells you how much wine they sell, ask “how does your rate of sale interact with your market capillarity?”

Oct 15, 2025

While I was studying last year I found a great podcast about La Place de Bordeaux with Patrick Schmitt MW and Colin Hay, which introduced me to the word ‘capillarity’ in the context of wine distribution.

It’s an elegant way of describing how a product moves through a market, how wide their distro is, how many points of contact it reaches, and how far from the winery it travels.

The episode grappled with the points of distribution challenge for Bordeaux Négociants, and why La Place gives immediate access to a large number of distribution points, and how this is coupled with the strength of a brand.

As Patrick Schmitt MW puts it:

“Négociants have capillarity, the ability to find demand and fulfil it. Added to this appeal, or pull factor, has also been a push by La Place, with courtiers seeking out producers and encouraging them to come to the distribution network.
But, as I warned any fine wine makers who might now be considering the system, it is designed to distribute wines, not build brands”

In wine more broadly, ‘capillarity’ describes how widely and effectively a producer’s wines flow through the market.”

Immediate access to markets doesn’t immediately equate to growth in sales. How quickly does the second order from a new outlet come through?

Wineries have to understand the ratio between a number of different metrics when understanding sales strategy. One that gets overlooked is ‘Rate of Sale’.

**The Maths of Growth: CAOVF**

For direct-to-consumer brands, the simplest model uses three variables:

Customers (C) × Average Order Value (AOV) × Frequency (F) = Revenue.

This is not new ground, plenty has been written about this data metric idea, but it’s still the cleanest way to think about growth. A hundred customers, spending £100 twice a year, gives £20,000 in revenue. Multiply to 250 customers at the same spend and frequency, and you’ve got £50,000.

Pulling one lever has an isolated impact. If we wanted to double revenues from £50k to £100k, by only changing one metric alone we’d need to do the following:

Double customers to 500, or double average spend to £200, or increase frequency by 250% to five purchases per year.

Instead, aim to compound increases in multiple metrics by a smaller percentage. Increase both Customers and AOV by as little as 20% and increase Frequency by 50% and you’ll be in a stronger overall position from compound growth in all three areas.

300 Customers * £120 AOV * 3 Purchases = £108k

Established businesses would be totally amazed with 5% growth in the current climate without a significant catalyst, so these numbers are for illustrative purposes.

Either way, the compound approach makes more sense than obsessing over one metric in isolation. Don’t go all-in on driving web traffic and increasing check-out optimisation without looking at basket spend or retention rates.

Bottles or Cash?

Unlike a digital brand, a winery has physical constraints, production volume may become a more important metric than revenue in the short term.

There are so many layers of distribution, margin, hidden costs, marketing, logistics that looking at revenue might not be much use compared to looking at ‘number of bottles out of the warehouse’.

So, when thinking like a winery, swap AOV for Average Order Quantity (AOQ).

You can break it down by channel if you like.

100 DTC customers × 5 bottles × 2 purchases per year = 1,000 bottles.

200 export customers × 600 bottles × 6 shipments per year = 720,000 bottles.

You get the idea.

This is also where the distinction between ‘brand’ and ‘estate’ becomes useful. A scalable producer with no ceiling on volume behaves like a brand. An artisan estate, limited by vineyard size and vintage conditions, behaves differently.

One is slower, more deliberate, less flexible. Many wineries drift between the two, the ebb and flow of brand-like behaviour even if their production size can’t sustain it.

Rate of Sale v Frequency

Rate of Sale and Frequency aren’t the same thing.

Rate of Sale (ROS) - Total bottles shifted within a set timeframe, per channel or outlet.

Purchase Frequency (F) - The number of transactions or purchases.

They complement each other, but they don’t tell the same story.

An indie wine shop might take fifty transactions a day, six bottles on average, 300 bottles total. That might look like: 90 bottles of shit Pinot Grigio, 60 bottles of an easy-going Appassimento red, a random case of an expensive Tuscan red, and the rest scattered across ten per cent of the range.

The rate of sale on the Pinot Grigio dwarfs that case of 1997 Brunello Riserva.

The old 10–80–10 rule. Ten per cent of wines drive most of the business. Eighty per cent tick over steadily as the core range. The final ten per cent sell slowly but serve a halo purpose, they make your range look like you know what you’re up to.

The Human Element

Back to the point. Wine industry nerds love trying different wines, love recommending a different wine to every customer, love the next thing their rep shows them, and think fondly of the last all expenses paid trip.

Paying customers are often creatures of habit, they’ll find that one wine they like. They’ll buy it by the dozen until they ruin the memory of it, or their indie merchant best friend finally convinces them that this grape, from that place is both tastier and cheaper than whatever is in their comfort zone.

When you’re a DTC focussed brand, you can take a top line look at those simple metrics. You can incentivise frequency, you can tweak your free delivery thresholds and grow your mailing list.

Rate of Sale exists in the space between comfort and excitement. Consistent discovery coupled with accessibility, new fans and loyalists alike.

Take two on-trade examples:

A single site restaurant that takes 60 bottles per month, every month
A restaurant group that has 6 sites taking 120 bottles every 2 months.

On paper, both equal 60 bottles per month overall, but per site the single restaurant has a six-times higher rate of sale. Roughly twelve bottles per week, compared with two.

Almost every channel apart from DTC depends on Rate of Sale.

Focused energy on customers where the ROS is high is where a winery builds genuine traction, not just a list of shiny new customers.

That new on-trade listing? Useless if they only order six bottles a year and let them gather dust in the cellar.

That trendy hybrid merchant? Useless if the staff haven’t even tasted it. How are they going to sell it?

That online mixed case? Great exposure, but if the selection changes monthly, where’s the second purchase coming from?

Capillarity Revisited

In wholesale, the number of customers and the number of outlets are not the same metric either. This is where we come back to capillarity, and why ROS is so important.

For an established artisan producer, like those distributed through La Place, increased capillarity might mean more outlets, more visibility, and a slow but steady ROS from loyal, educated buyers. In their case that’s fine, that’s a prestige brand awareness play.

While a growth brand, built on awareness and maximum exposure, a high ROS might come from a large number of new outlets, infrequent purchasers with a low likelihood of a repeat purchase.

The point there is to establish high ROS through brand recognition and activation, it can often lead to quick range or SKU extensions, a need to remain agile, targeted price promotions, high impact point of sale (POS). Multiple outlets then fight for attention, and eventually some consolidation is needed or a market saturation point is found.

In both cases, understanding the strategic relationship between capillarity and rate of sale is everything. It’s not just how widely the wine travels, but how fast it moves once it’s there.

Next time a winery tells you how much wine they sell, ask them “how does your rate of sale interact with your market capillarity?”

You might get a much more useful answer.