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 on how to become an AP type of wine business please schedule a “Smart Start” call through our contact page here: https://winecompliancealliance.com/contact-wca/
I’ll walk you through the start to finish items you’ll need to plan for related to: licensing, recordkeeping and reporting.
Was wondering how much an AP has to produce in order to maintain their AP.
Is it a certain amount of gallons each year? or every 2-3 years?
Hi Cory- short answer is no there is not a minimum specific gallons. A bit longer answer is yes all winery type license holders (which all APs are) are required at the federal and state level to produce wine on certain levels of frequency. If you want the full details on both of those that would require a consult call w/my office.
What are the legal implications of being or becoming an AP?
Thanks for reaching out. Your question here would require setting up a consult call with my office. I charge a fee for these calls of $375. The call can be recorded and sent to you afterwards as an MP3 file. We almost always cover a lot of ground on these calls (up to an hour in length) so I feel confident if you are considering becoming an AP type of wine business that you’d get your questions answered. Here is a link where you can sign up for one of these calls https://winecompliancealliance.com/contact-wca/