Feasibility of a Co-operative Winery

The number of operating wineries in the United States has doubled during the past decade. Most of this growth has been due to a large number of entrepreneurial landowners developing their own small acreage vineyards and trying to branch into winemaking. However, wineries are capital-intensive enterprises which require high initial investment and experience lagged cash flow associated with the time between the purchase of grapes and initial wine sales. Additionally, the availability of local grape production often limits the production capabilities of an entrepreneur’s small winery. As a result, some vineyard owners consider establishing co-operative wineries. This paper describes a feasibility assessment tool developed to assist vineyard owners in examining the potential for a co-operative winery and provides an example of how this tool can be used to examine a number of co-operative operating scenarios.