Message Font: Serif | Sans-Serif
 
No. of Recommendations: 1

Does anyone own a wine importing business, or know much about such? Last night I was offered one.

I was at a winetasting and bought some bottles and it turns out the business is for sale. I knew the business well and even know a lot of the clients but only last night did I learn what kind of inventory it had and that it had recently been put up for sale. The old man who ran it had a stroke and the daughter does not run the business especially well.]

It wasn't the old man's primary business, but he did it as an enthusiast for 30 years. Sales are $5- $10,000 a month varying wildly/seasonally.

The present inventory, French and Spanish wines and some fortified spirits, which is not being added to, is worth about $120K at retail price and /$70 wholesale price, and the business is being offered for a negotiable $90K. I am assured I can get an import license in two months. Is that a big deal--would I benefit on the license from transferring the businesses to me at all? It was indicated that the license would come with the inventory. What kind of cost is it per year to maintain? I'll certainly research this, but if anyone has any information it could save a little time.

In fact, any info at all on either wholesaling or importing wine would be appreciated. I know the family and the offer is not likely to go anywhere for a while, but I still want to move quickly if I move, before the existing clients find other channels.

PS, best wine I tasted was a '93 Beaune-Greves, A. Ligeret, 1st growth, and I took home a case. I didn't like a Cotes du Rhone from 97, Alexandre Silvestre. My girlfriend just loved a Spanish '91 Vina Santurnia Gran Reserva, and we bought six bottles of that too. There was a great Armagnac too, Chateau de Laubade, but I didn't buy it.

jeanpaulsartre
Print the post Back To Top
No. of Recommendations: 1
I don't know much about the business, but perhaps you can make the offer to purchase contingent upon obtaining all necessary licenses to protect you from buying a 70-90k wine collection.

Jeffrey
Print the post Back To Top
No. of Recommendations: 1

I don't know much about the business, but perhaps you can make the offer to purchase contingent upon obtaining all necessary licenses to protect you from buying a 70-90k wine collection.

I did think of this. Thanks. I haven't made an offer yet, but will keep the board notified if anyone's interested. In the meantime, I've been discovering a few cool wine links.

jps

Print the post Back To Top
No. of Recommendations: 0
JPS --

How is your foray into the wine import business going? This is something I have been investigating for a while, but find intimidating.
Customs, ATF, state boards, 3-tier system, old boy networks -- seems like asking for a lot of headaches. I would be very interested in hearing of your experience, hope it is going well for you.

p.s. Anybody else out there have a perspective they would like to share on the wine or spirits import business and how one can break in.

-- Leucippus
Print the post Back To Top
No. of Recommendations: 1

JPS --

How is your foray into the wine import business going?


I am still talking with the party.

This is something I have been investigating for a while, but find intimidating.

That's also why I'm going slow.

Customs, ATF, state boards...

The business I'm interested comes with import license only because it is a wholesale business. When they wish to vend to the public, they do it through a shop, and split the profits. This is mostly strictly a wholesale business. There is no retail, so no state liquor license.

3-tier system

I don't know what this is.

old boy networks

True. The business I am interested in is 30 years old, and has a degree of brand recognition in LA. I would not change the name for at least two years. All the current distributors around here are pretty entrenched. I would be but one more, taking over an already established business.

seems like asking for a lot of headaches. I would be very interested in hearing of your experience, hope it is going well for you.

As the woman selling the business is in Europe a lot, I have only hooked up with her one additional time. In the interim, I keep reading on Burgundy and Bordeaux.

A couple of things I've learned: Spanish wines are among the most profitable. They can be bought for a song.

Among the headaches, you forgot storage. With a large inventory, large enough to make money, you need to rent a lot of space. My home could not even hold a tenth of the inventory I would inherit.

Bottled wine in quantities greater than a case is stored by pallette. You basically need a space specifically tailored for it. These can be pricey. And if they fail for 12 hours, your inventory is vinegar.

Most restaurants near big hotels are looking for big names.

Most midrange restaurants are looking for sweet $5 chardonnays that they can sell for $5 a glass.

Most fine restaurants do not sell French wines on any kind of predictable scale. There are lots of $44 Cotes-du-Rhones at restaurants that cost 35 francs in Paris. At the higher ends, ironically, is where the restaurants are more forgiving.

Every time I go out, I chat up the French wine, and see that it is being marketed incorrectly almost all the time. In California, the California lines are really ascendant. If a sommelier recommends to me a Napa pinot noir, I remind him that the grape was cultivated for hundreds of years on French slopes full of limestone, the likes of which are almost unknown in Napa or Sonoma.

Because the woman has not advertised the business for sale, I am on the verge of making an "option-to-buy" offer. I would take over the business for a year and have an option to buy at the end of the year. Another party is interested in acquiring some of the inventory, but not taking over the business--I think given these considerations an "option-to-buy" will run the least amount of risk.

jeanpaulsartre
Print the post Back To Top
No. of Recommendations: 0
Dear JPS,
Hope all is well with you and your wine adventure. I'm not in the business, but I am an avid reader, and it seems to me the biggest issue the simultaneous travelling and managing? Pressing flesh, sharing wines,talking business and staying in touch is both a thrill and a challenge.
Good luck.
Print the post Back To Top
No. of Recommendations: 0

Dear JPS,
Hope all is well with you and your wine adventure. I'm not in the business, but I am an avid reader, and it seems to me the biggest issue the simultaneous travelling and managing? Pressing flesh, sharing wines,talking business and staying in touch is both a thrill and a challenge.


Thanks. This particular deal, unfortunately, did fall through. The woman kept selling off the inventory without importing, until there was nothing left worth buying. Then there was suddenly a warehouse involved, and most importers I spoke to said it was too small, as it held precisely about a container of wine.

While negotiating, however, I did construct a fabulous Excel spreadsheet in which I could see the profit factoring licensing and import fees in, that jumped in about 40 places if I changed the price or the purchase cost. So I have that in hand now, and that was worth the whole negotiation.

I may just start it up on my own. Right now two partners and I are laying aside X a month, and saving this much we will have enough cash on hand earmarked for the business to be able to import a container in December.

BTW, try The Wine Cellar board, most of the wine posters seem to favor that board over this one.

jps
Print the post Back To Top
No. of Recommendations: 0
As you begin your business, if you need any strategic consulting, please advise so we may speak. I worked in the industry for over eight years with experience in Strategic Plan, Marketing, Sales.
Print the post Back To Top
No. of Recommendations: 0

Are you on email? I'd like to talk about how the business changed in the time you were in it, and why you left.

jeanpaulsartre
Print the post Back To Top
Advertisement