A s a custom crush winemaking facility, a common question we get asked is, “how do I start a wine label?” Because this is so common, we wanted to provide a brief overview of some of the factors involved in this process.
If you’ve ever considered starting your own wine label, it’s likely that you don’t know where to begin. Many first-time business owners might assume that you have to own your own winery to start a wine company, but that is not the case for many new labels. There are many components to consider when thinking about making your own wine, and we are here to help. If you are thinking of potentially starting your own wine label without the burden or expense of owning your own winery, here are some pertinent details to keep in mind.
Though it might sound tempting to start the process with finding grapes and immediately conceptualizing your flavor notes, it’s important to begin with considering the business side, specifically compliance. You will need the standard business items, such as Tax ID, liability insurance, etc. to get you started. From there, you should decide on whether you’ll be an alternating proprietor (AP) or not. If you decide on AP, you are required to have a bonded winery application, which will impact interstate shipping allowance (if you foresee this being a component of your wine-making business). Lastly, you will need a wholesaler permit and a 17/20 license. The Californian does a good job of summarizing the types of licenses you may want to consider further. Though many of these items probably sound intimidating, it’s important to launch from a process standpoint in order to lay out the business side of your new wine label. You’ll be glad you did.
And now, the fun part! First, you need to decide on your source of desired fruit. The grapes you choose play a huge role in how your wine may taste, so you will want to devote some time and consideration to this step. When choosing grapes, you should consider the method in which you source grapes. For example, would you like to buy grapes by the ton from a local vineyard? Maybe you’d like to buy a section of a vineyard by the row, or perhaps you can plant the grapes yourself. Keep in mind that if you do choose to plant the grapes yourself, this is a long process. You can expect three to four years to go by before you have your first harvest of usable grapes. No matter which grapes you choose, it’s important that you make a decision that you feel would benefit you and the growth of your wine label over time.
The next step in creating your own wine label will be to determine who exactly makes the wine. Winemaking is said to be both an art and a science. Because of that, much of winemaking can be attributed to a feel, and other parts can be thought of as simple science know-how. Depending on your level of comfort and experience with winemaking, you may consider making the wine yourself. However, it’s always an option to hire someone else to make the winemaking decisions for you, which could free up your time to make other important business decisions for your label.
You can’t make wine without a facility. Because of that, you must decide where exactly the winemaking process will take place. Some common facilities that wine labels regularly utilize are garages, new wineries, or custom crush facilities (oftentimes called “cooperatives”).
Within your decision on which type of facility to use, you should also consider what types of equipment you’ll need to purchase. One perk of using a custom crush facility is that they often have great equipment and services that are available for you to use without you having to handle the overhead and business operations of your own winery. However, if you decide you’d like to manage the facility that produces your wine, you’ll likely need to secure tanks, sorting equipment, pumps, and presses. Keep in mind that you may need to be in charge of not only purchasing these items, but also facility maintenance and cleaning. According to The Grapevine Magazine, custom crush facilities are oftentimes attractive to new business owners because of the privileges the business owners can still enjoy relative to their wine like the marketing, trademarking, and bottling of the wine. Lastly, keep in mind that different states have different laws regarding custom crush facilities, so check out your winemaking state laws before making any permanent decision on your choice of winemaking facility.
Other than the aforementioned supplies you’ll need if you decide to own the winemaking facility, there are other supplies to consider when you have your own label. You will need barrels to hold your wine while it ferments or during aging (see our blog on fermentation vessels) and glass bottles when it’s ready to be bottled. You may be able to buy wine bottles from a wholesaler, or you may want to spend time designing your own. Next, you’ll need corks to enclose the wine within the bottle (unless you decide to use twist-off screw cap closures). Lastly, you will need labels so your customers can identify your brand, and continue coming back to your wine over and over again.
Bottling is a critical moment for wine. There are a couple of options you have for bottling purposes, but the first question you should ask yourself is whether or not you are bottling your own wine. Many winemakers decide to contract out their bottling instead of bottling the product themselves. You can do this with either a stationary line at your own facility or a mobile bottling line. All methods have their pros and cons, so it’s up to you to decide what’s best for you and your wine.
Then comes the decision of where you will store your wine after it is bottled and before it is sold. Choosing a wine storage facility is an important step. You will oftentimes have to store the wine during bottle aging. Once the wine is ready to release, you need a reliable warehouse capable of delivering your wine where you need it to go. Another option is to store the wine at your own facility if you have space. When you decide on storage, be sure to ask about temperature control, “in and out” fees, order release procedures and insurance for your product to ensure that your wine ultimately gets to your customers in its ideal condition.
Distribution and Sales
Wine distribution and sales is a part of the wine business that can be challenging for many first-time wine label owners. The most traditional method is the 3-tier distribution process for alcohol: producers, distributors, and retailers. Another generally more profitable and time-consuming avenue is DTC (Direct to Consumer). This method has a whole host of legal challenges that can be overcome with proper compliance.
Consider your options for brokers and distributors. Who will sell your wine? How will you distribute it? Do you plan to sell your wine yourself in your own store/company, or will you contract that out to another storeroom and another shipping and logistics firm? You may want to consider having a wine tasting room in a prominent location to let potential customers taste your wine before they purchase it, or you could showcase your wine at various wine tasting events around the world. There are many distribution and sales options for wine in this growing industry, which can help influence how much wine you eventually sell.
Lastly, deciding to start your own label should be a fun journey full of excitement, passion and learning! Starting a new wine business can make the “winemaking” part seem simple, and you’ll likely meet many like-minded people along the way that share your enthusiasm for wine. Here at Gravity Wine House, we definitely share the positive energy surrounding winemaking, so feel free to reach out with questions! We have experience with all of these aspects and enjoy every part of them in different ways.