Financing Strategies for Starting or Expanding Your Winery Business

Regardless of whether or not you are a fine wine connoisseur the allure of owning and operating a winery is on par with the most romantic career fantasies. It’s easy to picture the sun coming up over a glorious field of grapes and the bustle of a local tasting room full of friends and family. Dreaming up your unique flavor profiles and branding is far more appealing than imagining how you will finance your winery. Still, a quality financial partner is essential to getting any project of this scale off the ground. At Brewery Finance our services reach beyond the craft beer industry into winery startups, expansions, and more.

Assess Your Business Plan Before You Begin

Before you start touring spaces and talking to vendors you should clarify all of your business goals and objectives in a thorough business plan. This plan should include projections estimating your startup and expansion costs. This information will be highly beneficial when you start courting financial partners and considering physical locations. In the business plan for your winery you should also analyze potential revenue streams and profitability. Consider factors such as will your winery be exclusively a tap room, will you serve food requiring a commercial kitchen, and will you bottle and distribute your wine. 

Financing Options for Winery Startups and Expansions

There are as many creative options for financing your brewery as there are grape varietals to explore. Just in case you’re more of a “grapes person” than a “numbers person”, we’re going to outline all of your options here in this post, to make your decision simple and straightforward.

Self-Financing and Bootstrapping: Of course, you can always self-finance your project with your own personal capital. This option put all of the financial liability on you, the owner, and can also restrict your ability to grow and scale before your business is completely cashflow positive. These funds can come from a personal savings account, personal assets or equity. 

Traditional Bank Loans: Entrepreneurs aspiring to start or scale a winery can use traditional bank loans to access capital. The application process and due diligence requirements will be cumbersome, especially for an artisan business like craft beverage production. Be prepared to provide extensive documentation, vendor information, your revenue projections, and more.

Small Business Administration (SBA) Loans: SBA loans, offered by the U.S. Small Business Administration, are government-backed financial solutions designed to assist small businesses, including wineries, in accessing funding for various purposes such as startup capital, equipment acquisition, or expansion. These loans provide favorable terms and reduced risk to lenders, making it easier for entrepreneurs to secure financing for their ventures.

Venture Capital and Angel Investors: This is becoming an increasingly popular option for entrepreneurs looking to start local businesses. Utilizing venture capital and angel investing to start or scale a winery is going to require pitching your business plan and product in front of prospective investment groups. There are also equity and ownership considerations when using this financing solution.

Crowdfunding and Online Lending Platforms: If you want to use a platform like Kickstarter or GoFundMe to start or expand your winery be prepared to do lots of marketing on the front end to generate momentum for your concept. While this option might seem more appealing than a traditional bank loan, be prepared to exert the extra effort required and for steep platform fees. 

Winery-Specific Financing: Definitively, the best option is to work with a craft beverage-specific financing agency, like Brewery Finance. Working with a lender that has experience in your specific industry will cut down on application processing times. Brewery Finance also has experience financing the purchase of using equipment such as fermentation tanks, grape crushers and destemmers, presses, pumps, bottling lines, barrel racks, and temperature control systems. 

Brewery Finance offers working capital loans and more to assist in the startup or scaling of a local winery. Work with a specialized member of our team and receive your financing in as little as 24-48 hours so you can move forward with your next big purchase or put a deposit down on that special space.