How can "two buck chuck" at Trader Joe's be made so inexpensively?

It’s probably a loss leader. Get people in, they buy the chuck but while there ‘Oh, wouldn’t some twenty dollar cheese go great with this?’.

From a story I heard, Shaw went through a bad divorce with his wife, and she claimed either half or a good chunk of the company, so to get back at her he sells the wine at cost to make sure she gets as little as possible.

Great big giant stainless steel tanks. There was a segment on it on a news show not long ago. That guy’s not a vintner, he’s a chemist.

Word of Mouth marketing. They don’t advertise (except for the T.J.‘s circular), so the word gets out by people recommending it to friends.

From Snopes.com:

…As usual, the real explanation why Charles Shaw wine (as well as other brands) can be had so cheaply right now is a mundane one: we’re experiencing a wine glut. The wine boom of the 1990s led vineyards to increase production, but a downturn in the U.S. economy and the effects of September 11 have resulted in a greatly lessened demand (particularly in the restaurant industry), creating such an oversupply that many wines are now selling for less than the cost of production. Some vintners in northern California are even allowing their grapes to wither on the vine because the cost of picking them exceeds their market value.

Here’s a little more about the production – it’s bulk wine. It’s not Napa wine.

Thanks, @laureth, that sounds definitive.

“If there’s been one constant in our wine selection lately, it’s got to be Charles Shaw. Lovingly nicknamed “Two Buck Chuck” by a member of the wine press, these California wines have become something of a phenomenon in the wine world, and in our stores. Contrary to many an urban legend, these super-value wines began as the result of an oversupply of wine and a great relationship with a valued supplier.”

Trader Joe’s website

Hey, @avvooooooo, thanks for the link!

Earlier this year, The New Yorker profiled Fred Franzia, the man behind Two Buck Chuck.

His company buys and sells wine on a scale far beyond any other. In California, his company is the distributor, so no middleman. Basically it’s like Walmart underselling all the smaller operations.

@pdworkin You’re welcome.

Franzia! Ugh! I remember someone coming to a party I threw once while at uni and brought three boxes of Franzia “blush”. It was AWFUL!

Does “two buck chuck” taste good?

@aprilsimnel Still did the job, didn’t it? :D

@avvooooooo – Not for me! I ended up drinking from my own stash. But yeah, everyone else got buzzed pretty good on that stuff!

@aprilsimnel When my little brother was a pledge for his fraternity they were being punished for something or the other. So at the even they were going to, they were only allowed to drink cheap boxed wine. They ended up getting more trashed than everyone else and getting in MORE trouble because someone didn’t think when they were coming up with the consequences for their previous actions! HA!

Does “two buck chuck” taste good?

There are a few wines sold under the Charles Shaw name. I tried a red that was tolerable and a white I did not like at all.

I love Trader Joe’s. Reading this question immediately put the thought of Trader Jose’s Salsa AUTHENTICA in my head and now im drooling everywhere