You may be asking yourself, “What is a wine business calculator, and why do I need it?” If you’ve been keeping up with the BinWise series on starting a winery, you may already know the answer to that question.
You’re also well prepared to open up your winery. You’ve got a winery business plan, you're set with wine marketing, and you know if you’re hosting winery wedding events. Heck, you’ve even discovered the best climate for growing wine grapes. However, there’s always more to learn, and we’ll be wrapping up this series with more essential knowledge.
We will expand on specific points we’ve touched on in other articles in this series. These specifics add to the importance of wine business calculators for your wine sales. The financial side of running a winery isn’t as fun as discovering unique wine tasting room ideas or planting and growing grape vines. It is, however, vital to the success of your winery.
Starting a Winery Business Plan
Depending on where you’re at in your winery business plans, you may already have a business plan drafted. Maybe you’re mapping it out mentally without a written plan. Either way, these wine business calculators–and the way they relate to all your winery business needs–will help with your business plan.
If you’ve started your winery business plan but haven’t finished it, you can add these facets of the process where you need them. If you haven’t started your business plan yet, you can incorporate this information into your plan as you go along. In any scenario, the following information will guide you through opening your winery.
Wine Business Calculator
A wine business calculator can mean different things to different people working at a winery. For the business manager, it’s a calculator for costs and needs. For the winemaker, it’s a tool to measure the quantities of different ingredients and steps of the winemaking process. It can be a way to calculate seating needs, or wine bottle display counts.
Overall, there’s a lot that needs to be calculated at a winery. There isn’t one factor, function, or equation you can use to calculate all the needs of a winery. Each function within a winery needs its own calculations to keep the whole process running. Keep reading to see five common calculation needs for most wineries.
5 Wine Business Calculator Needs
Since there isn’t one calculation that will apply to every winery process, we’ve whittled it down to five areas of your wine business. Depending on how you’re setting up your winery, you may not need all of these. You may also find other ways to calculate these needs.
Whatever the case may be, these formulas provide perspective on everything you’ll need to plan. These five calculations and plans will guide you from opening your winery to operating it successfully for years to come.
5. Land Quantity Calculator
A land quantity calculator determines how much land you need to produce the wine you’re going to sell. The calculation also needs to include the land you’ll need for the winery building and any other event spaces.
The main number you need is the amount of wine you want to produce. That overall number involves bottle numbers, grape numbers, vine numbers, and space per vine.
It starts with finding your ideal bottle count.
That calculation looks like this:
# of Grapes per Bottle x # of Grapes per Vine = # of Bottles Needed
With that, you’ll have the vine count you need, and from there you can map out the spacing for planting those vines.
That’ll give you the space you need for the vineyard. Beyond this, the land quantity for your buildings will come from the design plan for your winery. That includes factors like wine storage ideas and tasting room capacities.
4. Tasting Room Capacity Calculator
Your tasting room capacity calculator is all about seating space and room dimensions. This will be based in part on the zone coding of your winery building. You’ll need to know how many people you want to host and can host according to state and local codes. US wineries all have specific codes they have to follow.
Part of your tasting room capacity calculation will depend on where you are. You’ll need to research occupancy standards and zone codes in your location. Once you know the number of people you can legally have in your tasting room, you can apply that number to everything you’ll need. The items you’ll need to count are:
- Tasting sheets and pencils
- Free gifts and souvenirs
The calculation for this count will be:
$/Glassware + $/Chairs + $/Tasting Sheets and Pencils + $/Gifts and Souvenirs = Total Cost of Tasting Room Needs
3. Wine Bottling Calculator
When it comes to production, your wine bottling calculator is one of the most important factors in planning your production count. The number is closely related to your land quantity calculator, as it brings together the grape and vine numbers to find a bottle count.
The calculation is:
# of Grapes / # of Grapes per Bottle = # of Bottles You Need
Your exact quantities will depend on the size of your vineyard. Once you have that first number, you’ll be able to order more bottles as needed. Finding that first, total vineyard need is the first step to starting your bottling line.
2. Winemaking Calculator
When you search for a wine business calculator, the top search results are winemaking calculators. These calculators allow you to balance the creation of wine itself. From adding ingredients and additives to measuring amounts for each bottle, winemaking calculators help you make better wine.
There are a lot of great winemaking calculators out there. If you have a winemaker working at your winery, they’ll probably have their own favorite option. There are many calculators for different parts of the winemaking process available. Our top recommendation is a fortification calculation.
The fortification calculation includes:
The Final Desired Alcohol Content (%) + Initial Volume of Must (L) + Alcohol Content of Fortifying Material (%) + Desired Baumé after Fortification (°Bé) + Initial Baumé of Must (°Bé) = Full Count of Fortification Process
Some of those words may seem foreign to you. When you get into these calculations, it's a good time to check in with your winemaker or vintner.
1. Budget Calculator
When it comes to a budget calculator, it’s less about general counts and more about everything your winery needs. For a budget calculator, your main need is an actual calculator and a list of supplies and equipment. Your general list will include startup costs, ongoing costs, and overhead expenses.
Your overall budget will be specific to your winery needs. Our recommendation is to start with an Excel or Google Sheets spreadsheet. Some budget items to include are:
- Bottling supplies, for getting together cases of wine
- Wine production needs
- Tasting room furniture and supplies
- Utilities for the building
- Taxes and permits
Frequently Asked Questions About Wine Business Calculators
Running business calculations is always a vital component of success. As you open and operate your winery, you’ll discover more questions down the road. For these frequently asked questions, however, we’re diving into questions that will help you at the beginning.
Starting a wine business can be intimidating. It’s a saturated market, and any new business is going up against a lot of factors. Our answers to these questions should create more peace of mind as you dive into your wine business.
Is It Expensive to Start a Wine Business?
The typical minimum cost to open a winery is $600,000, with some wiggle room. That’s a lot of zeros, but when you consider what that amount is buying–the location, supplies, staffing, and design–it’s not outrageous. It is something you need to plan for, but overall a winery isn’t more expensive than other types of businesses.
How Much Money Can You Make Selling Wine?
On average, it costs around $7 to make a bottle of wine. If you’re selling your wine for $15 a bottle, you’ll be making $8 per bottle. That gives you a profit margin of 53.33%, compared to an average bar profit margin of around 15%. Of course, that seems like a small number, but it’s a good way to break down your winery profits into a digestible amount.
How Do You Make a Successful Wine Business?
There isn’t one way to have a successful business in the wine industry. That can be daunting, but it’s also quite freeing. There are steps you can take, including having a great business plan, making a balanced design, and putting care into your wine production. However, the rest of it is up to you. There are challenges you’ll face, but there is also so much possibility for you to make an amazing wine business.
Wine Business Calculator: Balancing Your Wine Book
You’re off on a great adventure when you start a winery. All these calculations, business needs, and backend work is vital, and you’ll have your hands full keeping everything balanced. That said, be sure to take the time to appreciate all the work you’ve put into your winery and the joys along the way.
Running a winery is no small feat. You can always come back to the BinWise blog if you need more advice, or if you want something fun to read. The most important thing, however, is that you enjoy the process of running your winery. Having fun is a huge part of your success.