Compliance Lessons Part 2: What Alternating Proprietors Need to Know
Last week's post was a milestone for my website. The post on custom crush compliance lessons has received (as of this writing) over 1,000 viewings! It was a definite rush for me to see this response but it also tells me (reminds me really) that there are a lot of behind the scenes compliance details that both custom crush clients AND wineries need to be aware of. A particular section of wineries for follow up focus is alternating proprietors. (APs) An AP is basically a "winery within a winery". There are distinct differences between an AP and a custom crush client at a winery. Wineries- Do you KNOW what those are?
A winery within a winery. That is a very appropriate way to describe an alternating proprietor. It also should give some implication as to the main differences between them and custom crush clients.
An AP basically functions as a stand alone winery (minus the shared facility and equipment) This means they are responsible for:
- Making their own wines from grape to bottle
- Maintaining their own winemaking records
- Filing the required reports
- Payment of federal and state excise taxes
Basically everything you would expect a winery to manage as part of doing business. The key advantage of being an AP is that you don't have that large capital investment involved to get started as far as buying or building and the purchase of equipment.
It is the responsibilities that is the key difference between an AP and a custom crush client. (custom crush clients do not have any of the above listed responsibilities)
APs have become much more common in recent years, primarily due to the advantage they provide related to shipping wines direct to consumer. As an AP permit holder instead of being a wholesaler you are a winery and this allows you to apply for a direct to consumer shipping license in any state that currently offers one.
If you are interested in more of the details behind being or becoming an AP please send me an email to sign up for my free call:
"Starting a Wine Business as an Alternating Proprietor"
I'll walk you through the start to finish items you'll need to plan for related to: licensing, recordkeeping and reporting.
Send an email to: firstname.lastname@example.org