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FALL   •   WINTER   •   SPRING   •   SUMMER          New Vineyard Timeline
Grape - Winter Content

BUSINESS MANAGEMENT   •   CULTURAL PRACTICES   •   IPM   •   VINE NUTRITION & SOILS


2-years Pre-plant · Developing a Business Plan

It is often said that a business plan is like a road map that you will use to guide the future success of your business. A business plan should be completed two years prior to putting the first vine in the ground. This will allow you to properly present your business, or business idea, to loan officers, investors, or grant opportunities and to limit the number of "detours" you will experience along the way.

Developing a business plan is not as difficult as you would think and it provides an excellent venue to do some critical thinking about the why's and how's of you getting into the business of growing grapes. To get you started here are some of the major sections that are found in a typical business plan:
  • Tell the story of your business, the land, labor and capital behind the scenes.  This is an opportunity to market the business to investors or lenders.
  • In one page describe the keys to your success and what differentiates your business from the competition.  Be as persuasive as possible.
  • Even if you are not looking for investors or financing, this executive summary will be helpful to continually remind you of your objectives, mission and keys to success.  As a small company you'll need to remain focused, a written reminder to you and your employees can be very helpful.

Company Summary

Start-up Summary

Include a short paragraph to explain your start-up strategy and potential challenges or barriers to success that are particularly challenging to starting a vineyard or winery.  For most operations, capital investment and cash flow present the greatest challenges.

Identify all start-up funding that is available; separately include all financing you are seeking that is potentially available.  Also, identify all anticipated expenses and investments that will occur during the start-up phase.  The start-up phase is one year or whenever revenue is received, whichever period is longer.

Company Locations and Facilities

Site selection is key to a successful vineyard operation or winery.  To have both requires a unique combination of characteristics.  Highlight the characteristics of your land, or the requirements of land you intend to purchase.  Having a site that meets the requirements of your objectives will make marketing and operations easier and success far more likely.

Products and Services

Describe your core products in a narrative.  Use the narrative to describe the expected value of products.  Also include the volume your business will handle.  If your price expectations are different than market rates, explain why.  Will you be able to operate more efficiently and sell products at a lower cost?  Will your business add value to a product that others do not add?

Competitive Comparison

Assess the industry; seek advice from county resources and government provided statistics.  The core of the grape industry is highly competitive.  A value added product, such as wine, offers an opportunity for differentiation, this can be the most effective way of coping in a highly competitive industry.  Producers face stiff competition from established growers that operate with low margins.  If you are interested in vineyards, provide details on a strategy.  Innovation and size are the most common ways of overcoming competition and operating more efficiently than average.

The Market

Wineries and vineyards both have a certain nostalgia and romanticism associated with them.  It is important to put those feelings aside when writing your business plan.

Take some time to understand the market, both on a local and a national level.  Use this section to articulate your understanding of the market.  First and foremost a vineyard or winery is a business operation.  Without a comprehensive understanding of market conditions, your business strategy and financial plan cannot be verified as sound. 

Strategy and Implementation

With the information highlighted in your market analysis, highlight how you'll fit into that market.

To begin, what is your competitive edge?  In this industry you'll have to have one.  Just being established is a great advantage that the competition has.  You'll have to overcome that advantage by doing something differently.  For a winery a, truly unique idea that resonates with the consumer will greatly increase the likelihood of a successful outcome.

Next, what is your marketing strategy?  It is not necessary to describe all of the marketing programs you plan to participate in.  Rather, formulate an overall strategy.  This will allow you to filter through individual marketing programs and reject those that don't fit an overall strategy.

Finally, complete a sales forecast.  Include a breakdown of different products.  Estimate both volume and prices conservatively.  A conservative estimate will give you flexibility in the event of crop disasters or market variability.

Management Summary

The management summary should clearly define roles of personnel.  By clearly defining roles and dedicating some thought to the management structure and personnel plan.

The management summary is most important when a number of players fill key roles in the business.  The summary should contain ownership information, payroll plans and key responsibilities for the management team.

Financial Plan

Complete a comprehensive and realistic financial plan.  The financial plan should contain a break-even analysis.  It should also create a forecasted profit and loss.  Break down the profit and loss by year for the first five years.

Create a plan for cash flow, too.  Totaling and tracking an expense plan is essential to keeping the business grounded in reality.  During the start-up process bank accounts should be very large.  Make sure you remain conservative and do not run into cash flow problems.  For vineyards a negative cash flow should be anticipated for a minimum of three years.  For wineries, the range of negative cash flow depends on your investments.  Realistically, it could range between two and six years for a successful winery.

Resources

Penn State Ag Alternatives - Developing a Business Plan

Developing a Business Plan - Virtual Advisory.com  - While not directed toward agriculture, this site does an excellent job of asking the questions needed to allow you to critically think about starting your vineyard as a business.

US Small Business Administration - useful in developing and implementing your business plan.

Business Plan Workshop - an on-line course (takes about 30 minutes) at the U.S. Small Business Administration web site.  After taking a short survey you will be directed to the on-line course.

Starting or diversifying an Agricultural Business - This is a good basic resource that will help walk you through the steps involved in developing a new business as well as information on the various types of Business Organizational Structures.

Financing Small-scale and Part-time Farms -  Once you have your business plan in place you can start to look for funding using these resources to help guide you.


Content by:

Kevin Martin
Business Management Specialist
Lake Erie Regional Grape Program



Upcoming Events

2024 LERGP Winter Grape Grower Conference

Event Offers DEC Credits

March 14, 2024
Fredonia, NY

Winter Grower Conference

View 2024 LERGP Winter Grape Grower Conference Details

2024 NYSDEC How to Get Certified Course

Event Offers DEC Credits

April 4, 2024 : NYSDEC How to Get Certified Training Course and Exam Registration
Portland, NY

NYSDEC training course in preparation to take the pesticide applicator exam

View 2024 NYSDEC How to Get Certified Course Details

LERGP Coffee Pot Meeting #1 -Special Spotted Lanternfly Focus

Event Offers DEC Credits

May 1, 2024 : LERGP Coffee Pot Meeting
North East, PA

Come learn how to manage SLF when it arrives.  Discussion will be centered around Spotted Lanternfly research, management, experience and best practice for dealing with new and established infestations.  Lunch is provided today.

View LERGP Coffee Pot Meeting #1 -Special Spotted Lanternfly Focus Details

Announcements

NYWGF visits the Chautauqua Region

The New York Wine & Grape Foundation, led by Executive Director Sam Filler, is thrilled to announce their upcoming visit to your region this April!

During this visit, NWYGF will host an information session about programs affecting our industry. As you may know, NYWGF is sponsoring a Vineyard Survey aimed at gathering accurate and insightful data about grape growing in New York. If you are a grape grower or wine maker in the state, your input is crucial in shaping the future of funding and promotion for the industry. By participating in the survey, you will be contributing valuable data that will help inform decisions about the industry's future growth. We invite you to learn more about the Vineyard Survey, how you can help by providing your data, and how the results will be shared and will support the industry.



The NYWGF team will also be sharing information about our valuable membership benefits and services, as well as giving you an overview of the New York Sustainable Winegrowing Program. The New York Sustainable Winegrowing Program provides a clear pathway for vineyards to achieve certification by implementing regionally defined sustainability standards.

To make the visit even more valuable, a free lunch will be provided.

This is an amazing opportunity to learn more about the exciting developments happening in New York's wine and grape industry. NYWGF is thankful to our partner, American National Insurance, for making this visit possible. This public-private partnership showcases the impact that we can have when we work together towards a common goal.

Commercial Vehicle Awareness slide presentation

NYS Trooper, Matt Luft, presented on Commercial Vehicle Awareness at CLEREL on Thursday, August 2nd.  He has given us the permission to share his slides for you to reference at your convenience to share with others or to review. Please reference this link. 
https://lergp.cce.cornell.edu/cultural_practices.php?season=summer
https://lergp.cce.cornell.edu/business_management.php?season=winter


Straight Talk: Is H-2A Working Out in the Vineyard

Check out the story below.  Our local grower Andy Knight is one of the 3 growers interviewed.

https://www.growingproduce.com/fruits/grapes/how-h-2a-is-working-out-in-the-vineyard/

LERGP Podcasts- check them out!

LERGP POD CASTS

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