Stefanelli photo | The Stefanelli Distributing facility in Fresno covers 15,000 square feet, and was built late founder Bill Stefanelli and his wife Mary Stefanelli in 1960.

A local distributor with more than 70 years in business will soon be closing as the leaders of the company look toward retirement.

Stefanelli Distributing Company, Inc., a wine distributor based in Fresno near Clinton Avenue and Highway 99, has built its reputation over the last 74 years helping other family wine and spirit companies grow into major brands as well.

Founded by Bill Stefanelli in 1951, Stefanelli Distributing has distributed products from wineries including Sutter Home, Charles Krug, Almaden, Paul Masson, Glen Ellen, Blossom Hill, Martin Brothers and more, helping to raise their profile in the Central Valley.

Their spirits distribution business includes E&J Brandy, Belvedere, New Amsterdam, Skyy Vodka, Four Roses Bourbon, Pendleton Canadian Whisky and more.

Today the company is run by President Mary Stefanelli, CEO and CFO Carla Stefanelli-Rana, Vice President Carol Stefanelli and Vice President of Sales and Marketing Carl Rana.

 

In vino veritas

Carl Rana said there is constant change in how people consume alcohol, with younger people of drinking age being tracked by marketers.

The combination of larger statewide distributors entering the marketplace and independent grocery stores being bought out or closing down makes it difficult to establish loyalty, he added.

“The general market is starting to shrink, and consumption is down. So, Carla [Stefanelli-Rana] and I felt it prudent that this would be the time to retire,” Rana said. “Based on what we’ve seen over the years and how business runs, we got to that point where you can’t rely on hope as a strategy.”

He said he would have loved to continue running the company with its 16 employees for another few years, but they don’t see the market getting any better.

The 15,000 square-foot facility at 1945 Yale Ave. will be operational until the end of March, with an appraisal of the facility being the next step for a possible sale.

Rana said the younger generations are drinking less wine, and 20% of people ages 21-32 drink no alcohol — an issue for the industry.

The “800-pound gorilla” that tends to be ignored is the cannabis industry and its impact on alcohol consumption, Rana said, speculating it’s had about a 15-20% negative impact locally.

He said the 26-year growth they enjoyed from 1997 to the onset of the Covid-19 pandemic five years ago this week has been wiped out in the last two to three years.

China is down almost 40% in their consumption of California wines, he added.

“It’s a Catch-22 — low consumption, a glut of wine on the market and no place to go,” he said. “It’s going to be tough.”

He said the winegrape industry estimates it will probably have to pull out 300,000 acres of vines just to stabilize supply, but the value and quality of boxed wine will increase in the next two to three years because “there is great stuff right now that doesn’t have a home.”

This week, the U.S. Department of Agriculture released its Pacific Region Grape Crush Report, finding the state’s red and white grape crush for 2024 was 2.84 million tons, down 24% annually and the smallest in two decades.

 

Industry pressures

Smaller winemakers that own their vines, sell all of their product through wine clubs, tasting rooms or to the hospitality industry, and have no debt, are the wineries that will survive.

Wineries seeing their contracts getting cancelled and crops coming online will have a tough time, Rana added.

Outside of wine market challenges, California’s regulations and high costs make it difficult to operate.

California’s restrictions on trucks, high prices for diesel fuel and a 32% increase in insurance in the last four years creates a world of hardship.

“It comes to the point where the public is not going to buy something if it becomes too expensive, or they’re just going to buy it half the time, which will lead to a decline in volume,” he said.

Bill Stefanelli, Carl’s father-in-law, started out in the wine business in 1948, working at his brother’s store in Los Banos when a salesman from E&J Gallo Winery told him he seemed to “take great pride in the wine department.”

Shortly thereafter in 1951, Bill opened Stefanelli Distributing in Downtown Fresno in a rented warehouse, moving to the current facility built by him and his wife Mary in 1960.

The company had 10 salesmen when it started, serving the counties of Madera, Fresno, Kings, and Tulare with the wines of Ernest & Julio Gallo, owners of E&J Gallo Winery.

E&J Gallo Winery is the largest family-owned winery in the world, and Stefanelli Distributing has been crucial to making that happen, said Rana.

In 1991, after Bill died, the company became the all-woman owned company it is today. Mary, Carla, Carol and Carl have guided the direction of the company.

Rana said that he and the rest of the executive team want to retire while they are healthy.

Stefanelli Distributing’s clients and workers have been wonderful, he said. He informed them six weeks ahead of time of the company’s closure.

“It’s bittersweet, but it’s time,” Rana said. “You look for new beginnings, operate in the middle, and when the end comes you make do quickly so no one gets hurt, and try to start over with something else.”