I came across this article recently about the “top 10” mistakes that US wineries make in the US market. It was focused on wine importers however I found it to cover several very relevant point for any new wine business.
I have conversations every week with people who are in the beginning stages of starting their own wine business. They are very excited about the prospect of having their own wine in the bottle to show off with the label they’ve been designing in their mind. While I generally enjoy listening to their enthusiasm afterwards I’ll also make sure to include in these early conversations the details that are important for them to plan for if their wine business is to be a success in the long run.
These are details specific to the bottom line of their wine business, which plain and simple doesn’t have a “bargain basement” financial model to it no matter which way you slice it. So with that in mind we’ll talk a bit about the specifics of their wine business’ “who”. Who is going to buy their wine? And on a regular basis? How will they stay in front of that group of regular buyers? Why will someone want to buy their wine vs another producers?
[bctt tweet=”How will they get their message out there in a field that is crazy crowded with product?” username=”vinocompliance”]
Anyone who is considering starting their own wine business must consider these topics and do some of their own research when they are getting started so they can begin to have an idea of what the financial scenario of their business is going to look like. These “who” details can start to give them an idea of how much revenue their business may generate, but then on the flip side of that I will also point out to them the expenses they need to be planning for to blend in (deliberate wine metaphor there) against those potential revenue numbers.
What are just some of the costs to at least be aware of related to starting a new wine business? Keep in mind the dollar amounts of each of these areas will vary depending on who you’re working with and/or the products you’re purchasing.
These are just some of the winemaking costs to plan for, some of the others being the costs of getting your necessary permits/licenses (My area!) to legally make/sell your wines, marketing costs, wine shipping costs, and fees to set up your business entity filings.
The statistic that is still seen related to new businesses success rates is that around 50% of them fail in their first 5 years. I wonder what that rate is for new wine business start ups.
Like to discuss your new wine business plans? Let’s talk on one of my “Smart Start” calls.