Established Sonoma Wine Producer

Sonoma County, CA

Established Sonoma Wine Producer
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Asking Price: $685,000

Cash Flow: $80,000

Gross Revenue: $500,000

EBITDA: N/A

FF&E: $30,000

Inventory: $629,000

Rent: $2,000 per Month

Established: 2004

Established Sonoma Wine Producer

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Business Description

Prime opportunity to locate in prestigious Sonoma Wine Country

An ideal opportunity to purchase a turn-key wine company in the beautiful Sonoma Valley. We are a wine producer(Company) that was established in 2004 and have produced critically acclaimed wines(Wine Advocate, Wine Spectator, Sunset, Wine Enthusiast, International Wine Review)over the past 18 years. Our production ranges from 2,500-4,000 cases annually, and features super premium mountain Cabernet Sauvignon, Russian River Valley Pinot Noir, Sonoma Old Vine Zinfandel, and others. The wines are produced by the owner/winemaker who has 25 years experience in wine production. We occupy an exciting and beautiful hospitality area that is leased from the facility where we craft our wines. While the Company does not own real estate, it has established extremely favorable lease terms for its production and the use of the hospitality facility, well below the current market price currently experienced in nearby Napa Valley. Over the years the Company has developed a growing Wine Club that now includes approximately 300 active "Friends". At present time, the Company's sales break down to 35%/65% Dtc/Distribution, respectively, by volume. Unlike many smaller operations, the Company has established distribution relationships in many states and Canada, including CA, TX, FL, MN. Revenue for 2021 is $500,000. Current inventory, which is 90%+ current, is $629,000. Casegoods, 2,200 cases, is valued at FOB, 50% retail. Bulk inventory, 5,000 gallons, is valued at COG's.
Current profitability and cash flow is flat. Recasting the P/L and CF, eliminating the debt service, eliminating redundancies, and incorporating efficiencies of buyer's current operation will generate excellent profitability and cash flow.
The opportunities are numerous, and can be realized through differing scenarios.
- The Brand/Company can be absorbed into a current wine company with its own facility and administration. Many of the current costs would be eliminated due to redundancy.
- Company can be moved to another geographical area, while maintaining its presence in Sonoma. This would enable a Buyer to operate in an additional area to enhance its sales and reach. This can take the form of continued sourcing and processing in Sonoma, bottling and shipping to a desired satellite location, all the while still maintaining the tasting room in Sonoma. Buyer could then have two locations for DtC. Or, sourcing can continue in Sonoma and other locations with grapes transferred to Buyer's own facility for processing in the Buyer's location choice. Or, any variation of the above.
- The Buyer can assume the Company and continue operations as they now exist.

In each of the scenarios the current Majority Owner/Managing Member/Winemaker is willing to assist in the transition as an employee, and would consider long term employment if the environment is conducive to a favorable relationship. This includes travel to assist in another geographical location.

Possibly available is the transfer of SBA Loan of $420,000 @ 3.25 %. This would mostly offset the amount of cash required for the sale.

Detailed Information

Location:
Sonoma County, CA
Inventory:
Included in asking price
Real Estate:
Leased
Building SF:
160,000
Lease Expiration:
8/31/2023
Employees:
3
Furniture, Fixtures, & Equipment (FF&E):
Included in asking price
Facilities:
The facilities in which the Company produces its wine is not owned by the Company. It is a "Custom Crush" facility that is compensated by the production fees paid by the Company. This is in the form of $/ton. Currently, the contract in place for the Company is "extremely" favorable in comparison to like facilities. The hospitality area is an indoor tasting room and an outdoor bar/patio that can accommodate 30-40 people in normal operations. Equipment: F450 Flatbed, small stainless steel tanks, various supplies and equipment, 90 newer FO barrels.
Competition:
The premium wine industry continues to be strong, especially in the current time of Covid. DtC has increased for many North Coast wineries during this period. The Company moved to its current location eight months ago, and is situated on a main artery from the Bay Area that navigates between Napa and Sonoma valleys. While competition is high in Napa and Sonoma, the new location provides an excellent opportunity to greatly increase DtC sales and Wine Club development. Locating a satellite DtC facility could improve sales substantially.
Growth & Expansion:
Growth is extremely viable with the current Company's profile. Preferable would be an increase in DtC. With proper marketing and effort the hospitality area holds tremendous opportunity for growth, both in sales on premise and in the Wine Club. This has been evidenced in the limited time occupying the space. Distribution has been held low due to the lack of inventory needed to service a territory. There are current opportunities that can be realized almost immediately. Growth incurred expenses are the biggest obstacles.
Financing:
Available for possible assumption is an SBA Loan for $420,000 at 3.25%.
Support & Training:
The Winemaker/Managing Member will assist in all wine production areas, including: sourcing fruit, wine production protocol, facility layout and logistics if Buyer is building a production facility. Winemaker will assist with packaging, transportation, sales and relationships with distributors. The Wine Club logistics will be covered by the current Operations Manager.
Reason for Selling:
Winemaker seeking to reduce complexity. He wants to see Company reach potential
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Business Listed By:
Phillip Staehle

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