Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 11,000 wineries in the US produce and sell a wide range of wines. Wines can be broadly categorized into three groups: still wine, often referred to as table wine; sparkling wine, effervescent wines like champagne; and dessert wine, such as brandy. Most wineries operate their own vineyards for grape production, but may purchase a large percentage of their needs from independent growers.

Industry Consolidation

The industry has seen an increase in the consolidation of vineyards and wineries, particularly smaller, family-owned operations.

Increased Regulation And Taxes

The wine industry is subject to strict, frequently changing, federal and state government regulations covering virtually every aspect of operations from production to advertising.

Industry size & Structure

The average winery employs 4-5 workers and generates $1.8 million in annual revenue.

    • The wine making industry in the US is characterized by thousands of small, family-owned wine growers and wineries, together with a few very large, sometimes publicly-held, wine conglomerates.
    • There are over 11,000 wineries in the US, employing about 48,600 employees, and generating sales of about $20 billion.
    • The average winery relies on seasonal contract workers for many growing and production related jobs.
    • US export sales of wine exceed $1.6 billion annually to 156 different countries.
    • In California, about 615,000 acres are devoted to wine grapes, growing over 110 varieties of grapes and producing an average of 3-4 million tons of grapes annually.
    • The 4 largest US wineries, which include E&J Gallo, The Wine Group, and Constellation Wines, generate about 41% of total industry revenue.
    • The greatest wine producing states are California, Washington, and Oregon.
                                    Industry Forecast
                                    Wineries Industry Growth
                                    Source: Vertical IQ and Inforum

                                    Recent Developments

                                    Oct 27, 2022 - Wineries Seek Workers
                                    • Winemakers and the broader wine industry continue to struggle to fill jobs, even as demand for workers eases in line with seasonal trends. Industry online job site’s Winery Job Index increased 37% in September versus a year earlier to 538. (Index values are related to the number of jobs posted to Demand is strongest for winemaking and production positions with the index value rising 96% versus a year ago to 587. Demand for sales and marketing roles increased 28%, while direct-to-consumer jobs, including tasting room and retail staff, remained the largest component of the overall index with a value of 806, up 8% from a year ago. The strongest demand by far, however, is for vineyard labor, with its index value rising 192% to 500, Wine Business reported in October.
                                    • The California Beverage Container Recycling and Litter Reduction Act (SB 1013, aka the Bottle Bill), signed into law in September 2022, adds wine and spirits containers to California’s Bottle Bill program. Starting Jan. 1, 2024, California shoppers will pay an extra 10 cents for a bottle of wine or hard liquor, and will get that money back if they return the bottle to a recycling center.The law also requires wine and spirits products to be labeled with California Redemption Value indicia beginning July 1, 2025. The Wine Institute, which supported the bill, negotiated special provisions for new container types entering the program (i.e., pouches, bag-in-box) and an exemption for containers used in tasting rooms. The bill also contains numerous provisions meant to both encourage the opening of additional redemption centers and the efficient recycling of glass beverage containers.
                                    • Tourism in California’s wine country is on the rebound, but it isn’t quite back to pre-pandemic levels, according to The Santa Rosa Press Democrat. Among 58 Sonoma County tasting rooms surveyed, visitation in August 2022 was up 12% compared to the same period in 2021, and tasting room sales also grew 12%, according to marketing firm Community Benchmark. Tasting room comebacks have been somewhat slowed by a lack of labor, which caused some wineries to implement appointment-only tastings. Nationally, winery tasting room orders were down 6% from May through August, and cash spent per visit dropped 3% compared to the same period in 2021, according to Wine Direct, a winery sales software firm.
                                    • A scorching California heat wave over Labor Day 2022 had winemakers and viticulturists scrambling to finish their harvests, according to Wine Business. Wineries and vineyards rushed to bring in grapes in a compressed harvest amid heat that, in some cases, brought a month’s worth of ripening in just a few days. The heat wave compounded the effects of ongoing drought and a spring frost that damaged some producers’ vines. Drought led to crop reductions of 50% for some grape producers. Vineyards and wineries are investing in shade cloths to protect vines from the sun to cope with more frequent late-season heat spikes. Some producers are also shifting to more drought-tolerant rootstocks.
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