Ultimate Winery Accounting Guide: Managing Finances for Growth

Join 500+ wine business owners in the know, getting the latest accounting news in the wine business. For example, if the area dedicated to packaging takes up to 30% of your total facility floor Bookkeeping for Chiropractors space, you can apportion 30% of your total rent and building insurance to package. Conversely, utilities are usually broken down by actual consumption per production stage, unless all departments are using nearly equal amounts of energy. The costs of grapes, bulk wine, glass, and other dry goods must be assigned to separate wines and tracked by SKU. Knowing the COGS is essential if you want to know the gross profits you earn on different wines. You can take the price of a sold bottle and subtract the COGS to determine the gross profit you earned.

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We go beyond standard accounting and bookkeeping services to offer winery-specific financial analysis. Our team of industry veterans dives deep into your financial data, analyzing key performance indicators such as farming cost per acre and inventory turnover. These insights give you the confidence you need to make quick decisions to optimize your operations and maximize your cash flow.

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• Vineyards and wineries flourish through strategic financial management and operational efficiencies.
• Weighted Average Cost is a more generalized approach, calculating the average cost of all inventory items available for sale during the period.
• Navigating the financial ebbs and flows of seasonal production is a unique challenge for vineyards and wineries.
• For example, if the area dedicated to packaging takes up to 30% of your total facility floor space, you can apportion 30% of your total rent and building insurance to package.
• ©2024 “Pisenti & Brinker” is the brand name under which Pisenti & Brinker LLP and Pisenti & Brinker Management, LLC and its subsidiary entities provide professional services.
• Has your company been searching for a CPA experienced with wineries in the Santa Rosa area?
• Given the specialized nature of personal property tax issues in the wine industry, you can benefit from working with a firm that has experience in this area.

For over 60 years, our knowledgeable and experienced winery accounting team of CPAs and business consultants have been serving individuals and businesses in Western New York and around the nation. Knowledgeable about every aspect of the business, Cook CPA Group is committed to your success and growth. Our goal is to identify strategic opportunities, streamline complexities, and deliver tax solutions that align with your enterprise’s needs. They’re often tied to your distributor or retailer achieving specific sales goals. While tempting, avoid recording billbacks as income the moment you receive them. If you’re considering hiring a bookkeeper to prepare your financial statements, be sure to know what to consider when selecting one.

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Additionally, diversifying revenue streams can help mitigate the impact of seasonal fluctuations. Offering wine-related experiences such as tours, tastings, and events can generate income year-round, providing a more consistent cash flow. Collaborations with local businesses for joint promotions or creating wine clubs with subscription models can also offer steady revenue outside the traditional sales cycle.

Labor

To calculate COGS, periodically transfer the accumulated totals from these temporary ‘other expenses’ accounts on your P&L to the appropriate inventory accounts on your balance sheet. For example, “work-in-progress” for aging wine, or “finished goods” for ready-to-sell bottles. Throughout the year, as you pay for grapes, receive invoices, and process payroll, allow those expenses to accumulate within these temporary accounts.

Lowering your overall COGS will help increase your profit marge, but there are plenty of considerations to carrying this retained earnings out successfully. While those costs are being accounted for, it’s also vital to track the movement of your inventory. This includes keeping tabs on what materials and labor went into creating specific vintages and blends. Protea Financial knows and understands the specific challenges of running a successful winery.

• We offer traditional accounting services including forecasting and financial statements along with specialized services like wine costing and inventory valuation.
• At Matheney and Matheney CPAs , we understand how agribusinesses operate so we’ll meet all of your accounting and tax needs.
• Indirect costs, on the other hand, include overhead expenses like equipment depreciation, property taxes, and administrative salaries.
• With varying regulations in every market, reduce exposure and maximize your opportunities to save.
• New York competes head to head with California, Europe, South America and Australia in the global wine marketplace.
• The Tax Cuts and Jobs Act of 2017 also introduced several tax benefits that will impact the wine industry.

Wine sales in 2017 reached $41.8 billion according to Wines and Vines, which is up 2% from 2016. In 2018, the Craft Beverage Modernization and Tax Reform Act was passed, giving wineries in the United States much-needed tax breaks. The Tax Cuts and Jobs Act of 2017 also introduced several tax benefits that will impact the wine industry. That means there is money to be saved since the reform act will reduce excise tax payments and you may be able to accelerate your depreciation deductions. But between your time out with your vines, crushing grapes, or talking with customers in the tasting room about your new Cabernet Sauvignon or Pinot Noir, there can be little time for reading about tax laws.