How Are Your Sales… And, More Importantly, How Are Your Profits?

In the midst of the season, let’s take a minute or two to think about sales and to think about the profitability of the wine that your sell. Are you making a decent profit on your wine overall?

I see a lot of discounting going on and sometimes the discounts wineries are giving seem to detract from the value, rather than increase it. Certainly a discount of 10 or 15 percent on a case of wine is an incentive to visitors to buy those extra few bottles, and giving an additional discount to consumers who buy from you regularly is a good way to say thank you and let you know that they are important to you. However, I see wineries offering excessive discounts ­– which to me is any more than 25 of 30%. Make sure you have a good story to go along with that discount.

If there is no real reason for a large discount, visitors may believe that either the wine is not very good, or that they were grossly overcharged when they purchased bottles at full price. Many people like to get a bargain (I have to admit that I am one of them), but at the same time it’s important that they understand that getting your wine at a lower than usual price is something they shouldn’t expect very often. Here are a few ways to make discounting work for you:

  1. If you offer a discount for good customers, make sure the people you send the offer to are good customers only. You want people to feel that you are offering them the discount because you appreciate them, rather than because you are trying to get their business.
  2. Have a reason for offering discounts, such as the end of a vintage, making room in the warehouse for a new vintage, an annual or semi-annual sale, or to allow customers to stock up for the holidays.

Discounts over and above the regular six bottle, case or wine club discounts should not be a regular occurrence, they should be special and be positioned to customers as a time to take advantage of a rare opportunity. By not over using discounts you can use them to your advantage.

A tip of the glass from me to you!

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