Start a wine tour business by following these 9 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple step guide to starting your wine tour business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
STEP 1: Plan your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How long it will take you to break even?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a wine tour business?
Presuming you’re not going to plant your own vineyard, the costs to open a wine tour business are highly dependent on how you plan to conduct your tours. It may cost next to nothing to partner with a winery in your area if you plan to do the tours yourself. You can give the winery a cut of the tour profits as opposed to a cash offer to partner, which will save you on many of the upfront costs. Your expenses will rise quickly if you need to buy your own wine, provide food, or rent a space to conduct classes or tours. Some states or cities may need you to buy a Special Occasion License or special permit to run tours, so check your area's local regulations and fees.
What are the ongoing expenses for a wine tour business?
Wine tour operators should prepare their budgets for the following costs:
- Cost of wine/food
- Online advertising costs
- Guide salaries
- Special permits
- Tour-specific supplies (e.g., custom wine glasses, nametags etc.)
Who is the target market?
The target market for wine tours can be large. Most people are accustomed to social drinking, and even those who prefer beer or cocktails can normally be persuaded to go on a tour if it’s presented to them in the right way. You can also section your wine tours into beginner, intermediate, and advanced, so the material can be tailored based on how much experience and expertise your clientele already has with the beverage.
Or you can go after one specific segment if you prefer. For example, say you want to cater to a wine-centric upper-class. Your target market will narrow somewhat, but if you open in the right neighborhood, you could potentially attract the vast majority of people.
How does a wine tour business make money?
Wine tours usually charge for the length of the tour, which includes the cost of any food or wine samples provided. Businesses make money by charging for the time of the guide, as well as a small mark-up on any food or wine consumed or any products sold (e.g., bottles of wine, wine-related merchandise).
How much can you charge customers?
People will pay based on how much you give them, both in terms of tangible and intangible qualities. You can charge about $15 a person for a half hour tour that includes 5 different types of wines, or $40 for an hour long tour with 7 wine samples and gourmet appetizers. People will be willing to pay top dollar for excellent food, wine, and guides.
How much profit can a wine tour business make?
A wine tour business doesn’t necessarily need to cost a lot to run. If a half hour tour group gets 10 people at $15 a head, and it only costs $35 an hour for the guide and $20 for the wine, then that’s still $95 in profit for a half hour.
How can you make your business more profitable?
Wine tour operators may consider selling specific bottles of wine during the tours, with a cut given to the winemaker. There may even be money to be made by selling the actual grapes to amateur winemakers in the area, or wine-specific merchandise like magnets, T-shirts, or wine keys.
What will you name your business?
Choosing the right name is very important. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your wine tour business is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
For most small businesses forming an LLC is a great option, and it's easy enough to form by yourself, or check out the top business formation services.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a wine tour business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
For information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Businesses involved in the sale of alcoholic beverages are required to obtain a liquor license from the appropriate state or local agency. A comprehensive list of laws by state (including necessary licenses, zoning laws, etc), curated by the Alcohol and Tobacco Tax and Trade Bureau, is included here.
Certificate of Occupancy
Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a location:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a wine tour business.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your wine tour business will be in compliance and able to obtain a CO.
STEP 7: Get Business Insurance
Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
How to promote & market a wine tour business
Promote the tours as being both fun and educational. If you’re planning on attracting only the sophisticated wine set, show them how your tours are geared toward them in your advertising. If you’re marketing to novices, show them how you’re on their level, and won’t force them to swirl the glass 10 times before they can finally have the wine.
Recommended: Get started with local advertising for your business with a $300 credit from Yelp.
How to keep customers coming back
Customers need to have a good time when they’re with you. Again, this is highly subjective depending on the area you’re servicing. It will demand a lot of flexibility on your part to change the tours to each demographic you serve. Over time, you’ll learn how to switch up your approach for different tours based on your clientele.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Start A Wine Tour Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
This business is good for someone who already has a healthy interest in how vineyards work, and who enjoys teaching people in an entertaining way. Ideally, it should be far less about enjoying a good bottle of wine, and far more about being a good (and organized) educator.
What happens during a typical day at a wine tour business?
A wine tour owner may conduct the following transactions on any given day:
- Providing tours
- Learning new wine techniques
- Advertising the business
- Training new employees
- Hosting special events
What are some skills and experiences that will help you build a successful wine tour business?
A formal education in either teaching or in winemaking may give you an instant leg-up. If you don’t have either of these skills, you’ll need to be skilled at finding people who can do the job. In addition, you’ll need to be organized, have a true eye for details, and have a sense of what your customers are trying to get from the tour. This will come in handy when you’re deciding what to include in the ‘curriculum’.
What is the growth potential for a wine tour business?
The growth potential can be quite staggering for wine tours — even in places that aren’t generally considered wine regions (e.g., Napa, Bordeaux, etc.) People may come more for the experience than they will for a taste of an expensive red.
TRUiC's YouTube Channel
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a wine tour business?
Use your creativity to drum up business. This can be as simple as holding a garden dinner party soiree in your own home to get people interested in your tours. Market yourself heavily online (including managing your own website and maintaining a blog), and promote yourself with large groups as much as possible. For example, a corporate retreat or a family reunion may be that much more memorable if it’s done with your wine tour business, and you can expose more people to your tours this way.
If you do choose to partner with a winery, ensure you have a contract that is agreeable for both parties. Include clauses about what each business can expect if business should expand quickly.
How and when to build a team
You may want to wait to build a team until you’ve firmly established your business (unless you know the demand will be particularly high.) If you’re not planning to give the tours yourself, choose one or two people who have a friendly and enthusiastic personality, and are also excellent at explaining difficult and complicated matters. Be prepared to pay for your talent as this will be a huge component of the business’ success.