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Medium Market Entry Location Selection Strategic Relocation

Opus Two

#Consumer Goods #Agriculture #Luxury Consumer Goods
ProHub Comment

This case uses a market sizing framework combined with location analysis to evaluate strategic alternatives. It tests the candidate's ability to establish quantitative requirements (30 acres minimum for 120,000 bottles), apply those requirements to multiple options, and make a data-driven recommendation while considering qualitative factors like brand reputation and feasibility constraints.

Estimated Time 26 minutes
Difficulty Medium
Source Darden
31 / 100
Our client, Opus Two, is one of the most prestigious wineries in Napa Valley. The winery is renowned for crafting a single, exceptional wine – a Meritage Red Blend. Despite its reputation, Opus Two faces significant challenges due to climate change. Rising temperatures, extended droughts, and recent forest fires have made their location unsuitable for grape growing. As such, Opus Two is looking to relocate outside of Napa Valley and is seeking the firm’s help in choosing a new region and wine to produce. What factors should be considered when selecting a new location for Opus Two?

Clarifying Information

  1. What is a Meritage Red Blend? A Meritage Red Blend combines several grapes (vs. just one varietal like Pinot Noir) into a single wine. A portmanteau of “merit” and “heritage,” the name conveys high quality and tradition.
  2. What is the client’s goal? Opus Two is a passion project jointly owned by Darden’s Wine and Cuisine Club (WACC) and a sommelier from Philadelphia. Their primary goal is not to achieve a specific financial return, but rather to maintain their current level of production, quality of wine, and brand reputation.
  3. How does Opus Two sell its wine? They sell a limited supply of 10,000 cases (120,000 bottles) of wine per year to high-end restaurants all around the world as well as DTC online and in-person at the winery. A bottle sells for $500.
  4. When does Opus Two want to move? As soon as a new region and wine is identified.
  5. Has Opus Two identified any potential locations? Yes, we will see explore these locations later in our analysis.
Mock Interview
Interviewer

Our client, Opus Two, is one of the most prestigious wineries in Napa Valley. The winery is renowned for crafting a single, exceptional wine – a Meritage Red Blend. Despite its reputation, Opus Two faces significant challenges due to climate change. Rising temperatures, extended droughts, and recent forest fires have made their location unsuitable for grape growing. As such, Opus Two is looking to relocate outside of Napa Valley and is seeking the firm's help in choosing a new region and wine to produce. What factors should be considered when selecting a new location for Opus Two?

You

Thanks. Before analyzing, I'd like to clarify a few key questions...

Interviewer

Good question. Let me provide some background information...

You

Based on this, I suggest analyzing from these dimensions...

AI Score
Structure Analysis Communication Business Sense Quantitative
Practicing...
Score coming soon
Practice this case with AI Mock Interview

Opus Two, a prestigious Napa Valley winery facing climate-related displacement, must relocate while maintaining its production of 120,000 bottles annually and brand prestige. The case requires candidates to identify location factors, size the land requirement (30 acres), evaluate three vineyard sites against production capacity constraints, and select Walla Walla Valley as the optimal relocation destination.

Key Insights:

  1. Market sizing requires understanding the full value chain (bottles → grape clusters → vines → acreage) and being careful with percentage calculations (a 20% yield decrease does not offset a 20% acreage increase)
  2. Location selection involves balancing quantitative requirements (production capacity) with qualitative factors (brand perception, regional reputation, accessibility to luxury markets)
  3. Regulatory constraints (e.g., Washington State vineyard density limits of 750 vines/acre) can be binding factors in site selection and must be incorporated into calculations
  4. For established luxury brands relocating, maintaining brand equity and consumer relationships is often prioritized over financial optimization