What does the wine making industry do for profit when they begin a new bussiness?
Considering the length of time it takes for a fine wine to age,what do wine companies do for the first year,two,three,after they begin?Do they just operate in debt until their wine is ready for the market?The same question for other beverages which require such time to ferment.
So how did the old (presently established) wine makers make a go of it when they first began?How did they obtain the money to invest,just to sit back and wait several years for their product to age before they began selling it?
Tagged with: beverages • ferment • fine wine • length of time • money • wine companies • wine makers
Filed under: All Things Wine
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Most people who get into the wine business, already have a lot of money to spend. Some people lease vineyard space from other wineries or established farmers, or they buy land, which is very expensive. There are also people who are fourth generation farmers who bought land long ago when it was cheap and years later can finally afford to make their own wine. Some people go to an established winery for a custom crush, or their own label. This means that they don’t have a winery, or a place to sell their wine, but that they can make their own wine. Or they can possibly sell their wine through wine merchants. It comes down to money, if you don’t have money, or some really great contacts and relationships it doesn’t happen.
A more direct answer to the question is this…
Most new wineries started making their new label years before they even built a winery. They waited for the product to come of age, they have to have something to sell, and then built their winery. But it takes a lot of money and investors to do this, so they didn’t start making money on their product for years.
Now say you did it, you have your land or leased land, you made your wine, you built your winery, there is a huge chance that your first few vintages will really suck and you will actually lose all of your money trying to break into this very hard industry.
Most of the bussinessess’ that currently make wine are the ones that make many of the new wines.They can afford the start up costs.. which are enormous and they have stronger ties with the nationwide distributor network.The new ventures are always goaled as long term, but usually don’t make it.But, if they make it and become a standard they can become very profitable.