Do The Math
How important is a tasting room to a small winery on a well traveled wine road?
$2000 worth of wine sales per day (conservative estimate) is..
$14,000 per week is…
$56,000 per month is…
$672,000 per year is…
Less 10% for discounts is…: $604,800 per year in sales
But wait, there’s more.
Sales of "other stuff": $100 per day (conservative): $35,600 per year.
But wait…there’s more
Every day at least one person or couple will walk in your tasting room and connect with you. They’ll love your wine, they’ll love you, they’ll want to make you and your wine part of their life and they will sign up for your wine club. That one person is worth roughly $300 per year in automatic sales. After a year you have 356 people in your club who pay you $356 per year: $30,000 per year.
But wait, there’s more. Fifty percent of those who come in your tasting room every day sign up for you mailing list. Say 20 people on average come in making that 10 names on your mailing list per day. That’s 712 people per year sign up for mailings that offer them wine, say, twice per year. Five percent will buy when you offer them wine and they will buy an average of 6 bottles at, say, $25 per bottle: $10,500.
So, in your second year your tasting room grosses: $680,000
But wait…there’s more.
The pure promotional/advertising/name recognition you develop from having a tasting room helps your sales in restaurants and retail stores because visitors know you, are more likely to buy and order your wine and are more likely to tell their friends about your wine. Your wine will sell faster and your distributors and restaurant and retail accounts will order more wine faster due to this exposure.
So, one of Wark Communications clients is about to open a new tasting room in the middle of the Russian River Valley. It should gross them an extra $700,000 per year and net them at least $250,000 per year.
What can they do with that extra cash?..…yes…for a small winery this is how important direct sales can be. Besides pay their publicist, they can hire more people, spend more on marketing, buy better equipment, pay off debt, etc, etc…
Across the country there is a lobby of wholesalers who 1) don’t get that direct sales by wineries help them sell more wine and 2) are trying to stop wineries from selling direct.
Do the math.