In May, the average winery lost 70% of tasting room sales, and although Direct-to-Consumer (internet) sales increased by 66%, they’re from a much smaller base so didn’t make up for the on-site loss, WineAmerica reports after surveying 300 wineries whose production averages 8879 cases, $953,530 in sales. Wholesale sales were down 9%.
Most wineries aggressively employed or increased new marketing strategies like curbside pickup (87%), reduced shipping costs (66%), special DtC promotions (63%), home delivery by winery personnel (53%), wine club specials (52%), and virtual wine tastings (34%). Only 1% said “none of the above”!
During May, the average winery lost a total of $30,416, counting both reduced sales and unanticipated expenses, and expects that figure will rise to $35,490 by the end of June if the current situation lasts that long. And the average winery estimated that it will take 24 weeks (6 months) to get fully back to pre-Covid normal in terms of operations.
The wineries have been proactive about seeking government aid, with 70% applying for the Paycheck Protection Program (PPP), 49% for the Economic Injury Disaster Loan, 6% for USDA Disaster Loans, with only 20% not seeking anything. A majority of respondents favored an extension of the PPP time period and a reduction in the 75% payroll requirement (both of which have now been passed into law).
Only about one-third of respondents feel the federal government has been helpful, while 60% say their states have been.
Half of the respondents have opened their tasting rooms in a limited capacity, with 84% having specific guidelines or best practices to protect their employees, visitors, and their businesses. In addition, 55% report unanticipated expenses associated with the reopening.