How Much Does It Cost to Start a Winery? The Non-Glamorous Side of Wine Business


It seems (and even sounds) glamorous to own a winery. The thought of buying land and bottling your fresh grown, hand pressed grapes swirls around in your head. You can see a bottle with your name on it and money in your bank account. If only the business were that simple. In reality, it takes long suffering and dedication to start and run a successful winery business.

Knowing how much does it cost to start a winery is the easy part. According to a study at Washington State University, operating a winery costs between nearly $600,000 and $2.3 million. The investment depends on the size (amount of cases) you plan to manage. The hard part comes in the years of blood, sweat, and tears. That’s what it takes to get the business even close to what you dreamed of. Still dead set on making your winery dream a reality? Take this advice with you during your planning.

A winery owner will invest much more than they gain at first

Expect high numbers for how much does it cost to start a winery. That holds true whether you purchase an established one or build one from the ground up. What used to $100,000 per acre is now around $300,000. Later on, you can still look forward to annual maintenance of close to $20,000 per acre. Add in machinery and the cost to build a production building and tasting room.

There’s receiving equipment, cellar equipment, and material handling. For storage you need a refrigeration system, fermentation, and cooperage. Building a tasting room isn’t a requirement. Most people still chooses to. Not doing so leaves a bulk of money on the table from missed sales. 90% of your total sales to be exact. You also have to think about the funds you’ll have to kick out for permits. This means you shouldn’t expect to gain or even see a return in the first several years.

Patience is an understatement

The winery business isn’t for anyone who needs a quick turnaround. It will feel much like working for free for over a decade. It’s been proven to take between 11 and 13 years to get into the positive from your wine production. During that time your stages include planning, grooming and developing your vineyard, producing grapes, and executing your marketing strategy.

It’s difficult to hold on to your dream as your bank account appears to bleed. That’s why you should go into the winery business with the facts. Know that it’s common to pour in a massive investment. While keeping this in mind, work hard and be patient. Plan to devote most of your time to the business. Have a savings account or a plan to fund your personal expenses.

Look into other lucrative sectors outside of starting a winery

Owning a winery is only one option in the business. You can still make a good living, and do it more quickly, by exploring other opportunities. Many people even create their own products for frequent wine drinkers. There are a few more options that are close to the winery industry without the large investment.

Virtual Winemaker

If you don’t need to micromanage your business, you can consider owning the wine brand. With this concept, you’ll partner with other vineyards. With your input, they get the grapes and produce the wine. Some companies even create the label and bottle. Your job is to create and promote the brand.

The company handles the product, and you sell the wine. Look at it as outsourcing. This works if you’re comfortable with delegating many of your tasks to an outside crew.That way you won’t have to invest nearly as much money. You can also skip the years of grunt work before possibly turning a profit. The question how much does it cost to start a winery wouldn’t matter.

Multi-Level Marketing Wine Business

Another way to go is piggybacking off someone else’s bright idea. In recent years, a few millennials mixed a new product with an old business model.  Companies like Winestyr joined many other brands using network marketing. Makeup, jewelry, shoes, and now wine has a direct to customer approach. Most companies require their distributors to buy a certain amount of wine upfront. From there, they can resell it to their clients.

This opens the door for many marketing strategies. Some use the old fashioned house parties. Others focus more on their websites and social media. No matter what approach you choose, this is an option to start your wine business. You can be a distributor or start your brand for others to distribute. The best part is it’s without the worry of how much does it cost to start a winery.

Owning a Winery Isn’t a One-Person Job

Starting and running a winery isn’t one of the new age solo entrepreneur projects. If anything requires teamwork, it’s success in winery business. There are a lot of moving parts involved with starting and running a winery. Both the land and the product have regulations. You’ll need help with licensing and permits.

This portion of the business gets complicated, especially with rules about shipping and distribution. There are certain permits required to plant a vineyard and build a tasting room. It can also vary depending on how the land is setup. There are experts dedicated strictly to winery permits and regulations. You’ll want to leave the job to them.

As for the daily grind, consider partnering with someone else who has the same business goal. It may be worth it to split the work and the eventual revenue. Make sure their drive and work ethic matches yours. You’ll  each have some long days ahead of you. Even if you don’t directly partner, get some experts on your team. You need help with learning the business and getting funding.

Get help with funding your winery business

Before the real work begins, you’ll have to make a large investment. It could take several funding options to start your winery. That’s where LenCred can help. We specialize in helping small businesses and entrepreneurs find money. Most of our clients get funding through unsecured loans. That way you can focus on building the business without risking your assets. Let us evaluate your business and give you funding options.

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