You have searched, swiped and sampled…looking for the perfect addition to your wine program. Perhaps you found success through a friend of a friend, or maybe the pairing was facilitated through GrapeConnect’s marketplace platform. Taking the next steps to make it official doesn’t have to be scary if you keep the following considerations in mind:
Just as with any other stage of grape/bulk wine transactions, the more efficiently and completely all details are communicated, the smoother and less painful the whole arrangement is likely to be. Keep the adage about making assumptions in mind when considering the below variables:
- Confirm the wine/grapes to be purchased or sold; be sure to include any specific compositional aspects needed to support future label claims (ie. If you want to bottle finished wine as Willamette Valley, you should specify Willamette Valley at this stage
- Confirm the price per gallon – are there any price breaks based on quantity
- How many gallons are being considered? The actual final gallons may not be determined until shipping
- What is the wine’s status? Is it bottle-ready or are there any additional costs for blending/filtration(s)? Are there any costs associated with protective target SO2 levels and/or gassing procedures
- Confirm tax status; for bulk wine transfers, it is generally bond to bond. When wine is being shipped to a bottling/canning/kegging facility that is considered a Tax Paid Wine Bottling House, then it would have to be shipped as tax paid. Additional information on excise tax may be found at: https://www.ttb.gov/tax-audit/quick-reference-guide-to-wine-excise-tax#eighteen . Juice/grapes do not need to have a specified tax shipping status
- Outline the quantity, size, and cost of any additional items; totes, extra samples, etc.
- Define the terms of payment (100% Pre-Pay, % Deposit, Net 15, etc.). Payments may be made by check, wire, credit card or facilitated through GrapeConnect’s Onsite Direct Payment service
- Confirm the “payable to” entity and complete shipping address (include Bonded Winery #) for the wine, understanding that these may be different from the sample or tasting room address(es)
- Clearly establish who will be responsible for securing and paying for freight. Buyers typically cover shipping costs, however, sellers may have established accounts with carriers/brokers and could secure freight on the buyer’s behalf depending on the relationship. There can be a fair bit of time and effort involved obtaining quotes and securing and scheduling freight on behalf of buyers that might justify a small service fee being added to the cost of the freight that is being covered by the seller and passed along to the buyer. This would be a cost plus situation. Alternatively, and in many cases, buyers arrange and pay a broker/carrier directly for shipping (watch for more on this topic in a future post).
Any and all transaction details mentioned above may be formalized with a purchase order (if you are a buyer), a sales contract or a proforma invoice (if you are a seller). There are several templates available online for these documents if your current wine software does not have something suitable.
Clearly communicating all expectations at this stage in a single document/source will significantly reduce the chance of costly errors, delays and misunderstandings down the road.
What else? Have any feedback or other insights to share on grape/bulk wine sales confirmation? Or another GrapeConnect blog topic? Leave a comment below!