Vineyard/Wine Club Business Idea. Thoughts?

SkMed on 13/01/2019 - 12:20
Last edited 14/01/2019 - 17:38

Hey all, just wanting to get some thoughts on the following idea, this is in its early stages but thought it would be nice to gauge some thoughts on my favourite forum :)

My father recently passed away and left his 40 acre property to my 3 siblings and I. 15 acres of the property is a small vineyard, there is also an old farm house (which my brother and sister currently live in), plus a brand new massive 5 bedroom house he just built which sits overlooking the vineyard and nearby mountain ranges which is lovely. We also have about 5500 bottles of wine from the vineyard with it. The property is also only 1.5hrs from melbourne CBD, just off the Hume highway making it very accessible

We have several ideas about what we should do with the property/vineyard but one is a wine club idea my dad talked about, so just wanting to see what people thought of this as a business idea:

  1. We split the vineyard into 1 acre lots and have 15 people/groups buy into the club so they lease 1 acre of vineyard.
  2. Each club membership comes with 300 unlabelled bottles of wine up front from your vineyard.
  3. Also included in the lease is up to a 2 week stay in the massive new house overlooking the vineyard (so a holiday house for weekends away, or a city getaway etc. big enough for a massive family)
  4. Club members can be shown around the vineyard, shown how everything works, even help prune/pick if they want during their stay.
  5. We would also possibly fill the house with local produce from other farms/growers in the area during club members stay.
  6. The option to have their own label designed and printed might also be an option or they could take them unlabelled and do that on their end
  7. When its time to pick we could hire pickers to do it all, members can come and help on picking day too if they want etc.
  8. We would have a wine making day with all the members the day after picking (this would just more so be for fun, information, stomping grapes etc)
  9. The actual wine would be sent to be processed locally and then the club members would receive the wine from their 1 acre lot each year when ready (approx 2000 bottles).

I’ve done an estimate and I think $8,000 to $10,000 per year membership should cover the costs and give us a little bit of profit on top., (Part time farm hand to manage vineyard, maintenance, bills, wine making, bottling, upkeep etc.)

So you’re getting 1acre of vineyard, 300 bottles up front, labels designed for you, up to 2 weeks stay on the vineyard, a farm/vineyard experience, a day helping to pick (if you want), some free local produce when staying, and then up to 2000 bottles of wine per year.

Does this seem like a crazy idea?

EDIT: For anyone curious below is a video and some photos at the property/vineyard which I made a few years ago (house was unfinished though):

https://www.instagram.com/p/BOl_LJnh_J0/
https://www.instagram.com/p/BOgDA7chhXp/
https://www.instagram.com/p/BOhLbjUBn7o/

Financial

Comments

  • spackbace on 13/01/2019 - 12:56
    +4

    Just convert the house to a b&b

    • SkMed on 13/01/2019 - 13:02

      Yes, that was my first idea along with my youngest brother, however my older brother and sister have concerns about random people coming onto the property constantly and are concerned about damage to the house etc which can happen with Air Bnb's (although rare). They also have concerns about cigarette butts/fires as its a fire prone area. I think that if people were part of this club then they would likely treat the place more like their own, and we would also know who they are etc.

      Air Bnb still isn't off the table though. One plan is to Air Bnb the house and just lease out the entire vineyard separately but will take some convincing.

      • michelle181 on 13/01/2019 - 13:40
        +7

        My understanding was that a b&b is different to an Airbnb. In that, you can run a bed and breakfast on your own, you don’t need to list it only on that site. Run it more like a private hotel, perhaps be a bit more hands on (like meeting the guests, giving them a tour, coming in to clean the rooms daily if you are worried about them). Instead of just handing over the keys.
        Just adding my 2c.

        • SkMed on 13/01/2019 - 13:42

          Oh, sorry, yes totally miss-read that! Yes true, a traditional BnB might be better. I'll add it to the list to discuss with the fam. Thanks for pointing that out.

        • spackbace on 13/01/2019 - 13:53
          +3

          This. B&B with hosts. If they're already living on the property in the other house, it's not hard to do and be there when the guests need you otherwise stay out of the way

          • SkMed on 13/01/2019 - 17:23
            +2

            @spackbace: Yes true, B&B would probably be easier. Then just lease out the vineyard. At this point its probably the top of the list, but the wine club idea isn't far behind.

            • yoonibear on 14/01/2019 - 15:41

              @SkMed: Make it instagram-worthy - Or you could turn it into an experience + B&B (eg. Spend the weekend there, winery/vineyard tour, tours to other restaurants ..etc..)

              • SkMed on 14/01/2019 - 16:32
                +1

                @yoonibear: The view from the house looking over the vineyard and mountains at sunset is definitely instagram worthy haha. I'll have no problem handling any promo video, photography, design and online/website work as its what I do in my day job luckily.

  • outlander on 13/01/2019 - 13:12
    +3

    It's different, and so it's gonna sound a little crazy to people, but then the best ideas always do.

    Is there anyone else you know of that has done this? Best place to start with a new idea is to look around and see whose done something similar. If you can find them and talk to them, they can tell you of the pitfalls that you haven't even imagined. Generally the more people involved, the more problems you will encounter.

    Not really sure I understand the plan, either. You have 40 acres of property, but you want to split it into 1 acre lots, and then have a sort of timeshare arrangement between 15 people. Why do you need to split into 1 acre lots to do that?

    In any case, I can see it working if you have the right connections. Somebody like a well paid lawyer might like to buy into it, if only for bragging rights

    • SkMed on 13/01/2019 - 13:26
      +1

      No, I've not heard of anyone else doing this before and my next step is to try and see if anyone else out there has/does do it. There are wine clubs, sub letting vineyards etc, but nothing like what I have mentioned that I can find so far.

      Ah sorry, so the property total is 40 acres. But the vineyard is only 15 acres. So I was thinking 1 acre per membership. Would be totally open to members buying into more than just the 1 acre, but I figured splitting it 15 ways is a good as it would allow each member to have an acre and at least 2 weeks in the house (actually we could technically allow up to 3 or more weeks each potentially). So yes, essentially its like a vineyard timeshare but you also get your own wine from it which you could then brand yourself, on-sell, keep, gift etc.

      Yes that is exactly the type of people I would think would be interested. I know a few people from Melbourne who have bought hobby farms in the past but they ended up selling them due to the upkeep and time needed etc. So I figured something like this would be perfect for these type of people. There is enough room on the farm to bring the whole family too. The house will have (need to finish the decking) a huge decking overlooking the vineyard and mountains/sunset. There are multiple dams to go canoeing, fishing, swimming, camping, ride motorbikes etc. Kangaroos everywhere. We should potentially even have enough room to store members motorbikes and stuff if they would like to leave them if their kids wanted to ride around etc. The farm is also dog friendly etc.

      • outlander on 13/01/2019 - 14:42
        +1

        Okay. So your getting a 15th of the vineyard, not a 15th of the total production of the vineyard. Thats sounds like its going to be a complicating factor to me, and also something that will need explaining.

        I've never run a business or had anything to do with them really, but from what I've learned indirectly, you want to come up with the simplest form of the idea you can, work through all the details of it, the benefits and the risks, and that forms your starting point. Then, you can go through each additional feature you'd like to add, and work out if the extra revenue is going to justify the extra expense and liabilities of each feature on a case by case basis.

        Its also a good idea to decide why you want to do this. Is it purely to make money, a fun hobby, or is it as a way to honor your dads dream? Because to me it sounds like you're leaning heavily towards the last part, which also sounds like it might be a complicating factor.

        Don't let all the problems discourage you though! Every business opportunity has problems in the way. Your idea sounds like it could be a good one, from the perspective of a way to keep the property in the family while making enough income on the side to keep it going.

        • SkMed on 13/01/2019 - 15:34

          Well it could be done either way really. Or maybe something like a clause saying if there is a major discrepancy between sections then the higher yielding acres may be used to top up the lesser producing acres. Still not thought that far ahead, but it is on the list of things to figure out.

          Its would be both to honor dads dream, a way to keepo the vineyard operational and the new house from being empty and ideally make some money on the side while the property increases in value simultaneously. We need to do work to the rest of the property (fix fences, clear out machinery, clear out tonnes of steel leftover from my dads engineering business, remove old/defunct farm vehicles and also do some work on the old farm house to make it a better asset when/if we do decide to sell in the future).

          • geoffs87 on 14/01/2019 - 14:55
            +1

            @SkMed: Yeah i think vineyards are profitable on an economy of scale - so really what you are suggesting is creating a company with shareholders who own a portion of the producing vineyard.

            All you're really doing is leasing off smaller portions of your larger property. How long is the lease, how does one sell their lease, exit costs etc will be a big concern for a club member.

            Surely you can find a way to run the vineyard, and as others have suggested either B&B or AirBnB the house and maintain complete ownership and profit from sale of wine product.

            As for businesses investing etc - i dunno how sticky businesses/restaurants really want to be to a product - they want optionality and flexibility.

            Honestly the idea sounds great, you need a point of difference to make money these days, unless you're doing big bulk… I think the ozbargain community is a tricky place to test the idea, maybe look into 'fake marketing' the concept, kind of a test and learn to see where the interest lies.

            I've been doing quite a bit of research into mini farms/wineries in the hunter valley/mudgee, for the sake of airbnb and hosting weddings etc - as sydneysiders are starting to look more and more into these locations for weekend/weeks away from the city, and vineyard weddings. Sounds like your vineyard is not huge but also not small - being only 90mnins from melbourne sounds like spending a little bit of capital and employing a team could really elevate your options. Only comments there (as i don't know the area) - is there other vineyards / accomodation options in the area?

    • swapsey on 13/01/2019 - 15:00

      New ideas are hard to convert people to, because of how habitual humans are in general. It takes a lot of capital for marketing and education purposes.

      • serpserpserp on 13/01/2019 - 15:10

        Would it really? pretty simple concept. You give 8-10k for 2 weeks plus accommodation a year at a property plus a few hundred bottles of wine upfront AND every year from harvest/production. Plus you get to come down and get hands on a few days a year if you wish. Seems pretty decent.

        Guess it depends how much wine you drink (and how drinkable the vintage from this place is) and how much you could give away to friends/family/work contacts etc. Hell, If you are getting a few hundred bottles a year you could try your hand of selling them at $5 a pop and subsidize your fee.

        It is effectively a time share property with hundreds of bottles of wine at your disposal.

        • swapsey on 13/01/2019 - 15:14

          It's not that it's not simple. It's different to normal accommodation and wine buying. Different humans don't do well. If you run a business with new products and services and customers you have to pitch them to, you know.

        • SkMed on 13/01/2019 - 15:42

          Yes since you'd be getting about 2000 bottles per year Im thinking this would be aimed at maybe small/medium business owners who have an interest in wine/owning a vineyard but dont have the time for it. With 2000 bottles they could brand it for their company it and give it to clients/staff etc (which is what my dad did sometimes with the wine for his engineering business). OR yes, they could on-sell them.

          There is also the possibility to just sell smaller vineyard lot's maybe which would yield a more manageable amount of bottles per year for personal use, but the more people involved the more complicated it will probably become, so id rather aim bigger to begin with and gauge interest.

        • SkMed on 13/01/2019 - 15:44

          Also, the wine is great according to everyone who has had it. Granted they may have some bias, so im in the process of getting it tested and getting some opinions/reviews from outside sources haha.

  • serpserpserp on 13/01/2019 - 13:36
    +1

    Do I actually get to own the 1 acre?

    If not you should drop that concept. just split it a % 15 ways. Lets say an acre of land gets diseased or something, bit rough to have 1 member miss out on wine etc. while the others get their share.

    Also if you get 3 weeks worth of accomodation, I personally might buy into it! I like the idea! But would need to see it fully fleshed out.

    • SkMed on 13/01/2019 - 13:49

      I think people would like the idea of knowing they own a certain part of the vineyard, But you're right about the potential for some acres to produce more than others or none due to disease etc. These are all factors we would need to think about. I think when it comes time to pick all the wine/grapes would just be picked and processed together and then the whole lot split 15 ways.

      Good to know! haha. My dad had this same idea roughly, but his idea never included the home stay as he would have been living in the house. None of us really want to live in the house because it is so big and we grew up in the other smaller farm house and it has more sentimental value. So while thinking on this wine club idea and what we would do with the new house I realised it would be a great incentive to include the home stay as a part of it.

      • Hybroid on 13/01/2019 - 16:09
        +1

        I think when it comes time to pick all the wine/grapes would just be picked and processed together and then the whole lot split 15 ways.

        This seems very logical and fair but…

        So you’re getting 1acre of vineyard

        …what does that mean then? What's the material benefit in having 'your own' 1 acre?

        $8-10,000 doesn't seem like a lot of money for this, I think you'd easily drum up a lot of interest. I'm not even interested in wine and interested in this.

        • SkMed on 13/01/2019 - 17:02
          +1

          Again these are details I would need to work out. We could potentially seperate them so you get your actual wine from your lot, but I imagine it would cost more so would have to factor that in to the pricing, if people seemed to want that then thats what we could provide. If people would rather process them with other lots maybe they can be offered a bit cheaper even.

          Also someone mentioned disease and higher yield on certain parts of the vineyard. These are things we could work around a few ways (having a clause saying we may need to top up lower yield sections with grapes from higher yeild sections etc)

          When I say you have "your own" acre, you'd be leasing that section of the vineyard, you wouldn't technically own it obviously, you couldn't decide to rip out your vines and build an apartment block haha. Could let people name their sections and put up signage for them etc. Allow them access when they like to show friends family etc. The real material benefit would be the actual wine, home stay, and learning how it all works etc.

          $8-10,000 was a very rough estimate. I'm sure there are factors I have not thought of and I had to make a few estimates on the price of a few things. It could very well cost more, but with 15 buy-ins at 10,000 being 150,000 I think it should cover the cost of upkeep on the vineyard and processing the wine etc. Maybe not a lot of profit there though.

        • SkMed on 13/01/2019 - 17:05

          I think the real kicker for a lot of people would be having somewhere they could go for weekends away throughout the year to get away from the city within a reasonable drive from the city. A farm/vineyard/house they can go and use to unwind without having to actually buy a place or worry about upkeep and work to keep it going. It would be very easy to go there on a Friday evening and back to Melbourne to work early on a Monday morning.

      • MrBear on 14/01/2019 - 11:51

        Unless the whole property becomes a co-op, without council approval, you're not going to be able to sell 1 acre.

        You might be able to sell a share of the co-op, but the legal hoops you will have to go through to do either will be tough.

        • SkMed on 14/01/2019 - 14:23

          We arent actually selling the 1 acre blocks, we would be leasing them out so I dont think it would require council approval unless we were actually trying to sub divide and literally sell each acre outright.

          By just leasing it then it's really no different to renting out part of the property or an exisiting house which doesn't require council approval as far as I'm aware (although I could be wrong!?)

          • MrBear on 17/01/2019 - 09:09

            @SkMed: But in an above comment you said "I think people would like the idea of knowing they own a certain part of the vineyard".

            own…

            • SkMed on 17/01/2019 - 09:48

              @MrBear: True, mis-typed, they would be leasing it.

  • SkMed on 13/01/2019 - 13:53

    For anyone curious below is a video and some photos at the property/vineyard which I made a few years ago (house was unfinished though):

    https://www.instagram.com/p/BOl_LJnh_J0/
    https://www.instagram.com/p/BOgDA7chhXp/
    https://www.instagram.com/p/BOhLbjUBn7o/

    • serpserpserp on 13/01/2019 - 14:45
      +2

      Beautiful spot!

      • SkMed on 13/01/2019 - 17:19

        Thanks! Yeah you kinda dont realise these things until you get older haha.

  • whooah1979 on 13/01/2019 - 14:51
    +1

    40 acre property

    Have you guys considered selling the property?
    https://www.abc.net.au/news/2018-10-27/china-invests-wine-ba…

    • SkMed on 13/01/2019 - 15:28
      +2

      Yes, that is also an option, although ideally we would like to keep it. It's unfortunate that we cannot sub divide the property and sell the new house/vineyard and keep the farm house otherwise we would.

      We are getting a property evaluator in this week hopefully so we know how much if we were to sell.

  • ego22 on 13/01/2019 - 16:03

    how close are you with your siblings?
    and are you all pretty well off individually that somone wont "want out" in the near future, screwing any big plans u all have?
    my advice would be to divide the land up evenly or sell it all and divide the money.
    thats the only way me and my siblings could make it work.
    and i imagine thats the only cordial smart thing 96% of all siblings should do in that situation.

    • serpserpserp on 13/01/2019 - 17:08
      +1

      96%? Is this based off some evidence based research?

      Lots of families get along and keep land wealth in the family.

    • SkMed on 13/01/2019 - 17:17

      We are all close. No bad blood at all. We all grew up together on the property and my oldest brother and sister live there in the farm house (they moved back in once the new house was finished, because no point renting elsewhere)

      We all work and can support ourselves etc. None of us actually own property (although my sister was about to buy a house before this happened).

      My oldest brother worked with my dad his entire life in his engineering business so will be starting a new job soon, but he's fine financially and even expressed interest in taking on the vineyard if we were to go ahead with this plan as it would really only be a part time job most likely.

      If we decide to sell they are fine with having to move out, they would just buy smaller properties close by.

      None of us are in need of the money from selling the property and there is also an inheritance involved (not sure exactly how much yet, but would probably be enough for some of us to buy out others if they decided they wanted out). The initial money needed to set up this wine club could easily be covered by that inheritance with some leftover to continue fixing the rest of the property and fixing the farm house etc im sure.

      Im the only one who lives in Melbourne (i need to for work), but have no plans of buying a house, and no children etc. So for me if we did sell I actually dont know what I would do with the money. Not enough to buy my own place in Melbourne where I would want to live, and I dont want to go down the investment route and be someones landlord, so for me it makes sense to keep it even though I dont/cant/wont live there any time soon. It will increase in value over time, especially as we fix it up more so would be wise to keep it i think at this point.

    • SkMed on 13/01/2019 - 17:27

      Also its not possible to "divide the land up evenly" as it cannot be sub divided. Also then how do you decide who gets what parts haha. I mean id love the part with the new house, and not the empty paddock or junk steel. haha

  • Triple J on 13/01/2019 - 16:30
    +4

    Sorry for your loss ,looks like a beautiful property.

    • SkMed on 13/01/2019 - 17:22
      +2

      Thanks and thanks!

  • bluesky on 13/01/2019 - 17:15
    +2

    I like the B&B with hosts idea that Spackbace suggested. And maybe like some smaller wineries I see at Yarra Valley, run a winery door business - with tasting and selling at winery door. If you and siblings do not have time to handle this, maybe hire someone to do this. Of course, I assume there are other wineries nearby as well - to have the traffic. If it is isolated with only your winery in a large area, then this may not be feasible.

    And when people like your wines, you can even run a sell wines online business, which I see quite a few smaller wineries do.

    Great video/pics, BTW.

    • SkMed on 13/01/2019 - 17:21
      +1

      Yeah a B&B and then just leasing out the whole vineyard to another winemaker might be the easiest thing to do I'd say. But just thought this wine club idea might just be crazy enough to work. haha

      • bluesky on 13/01/2019 - 17:36

        I met someone who was conducting a tasting at a winery door of a big winery at Yarra Valley. (She wanted to remain in the area, so worked for a bigger winery).

        Turned out her parents operate a little winery and bottled their own wines in smaller quantities. And it can be picked up from the local supermarket, which stock and support local wines. They also sell through a website.

        So might be worthwhile to speak with your local supermarkets/stores there to stock your wines.

        I actually went to the local supermarket afterwards just to pick up that wine since it sounded interesting, and because they do not operate a winery door.

        • SkMed on 13/01/2019 - 18:33
          +1

          Yes we are in the process of trying to sell some of the wine. We are taking it to local restaurants in the area and I will be dropping samples to some specialty wine stores in the next few weeks to see if they are interested in stocking it. We are also just casually selling it to friends and family etc. Trying to sell/move the wine stocked at the property is a job/issues in itself and will require us to become part time wine salesmen! However this wine club idea kind of kills two birds with one stone being able to unload this wine supply instantly (well after setting up the club).

  • RoseK on 13/01/2019 - 23:21

    A good wine club usually profiles up to six new wines each meeting and serves food, usually good cheese, and crackers, at an appointed break period. For each new meeting, you will need to elect someone from within the club to give mini-lectures on the presented wine. These mini-lectures should touch on the flavors, aroma, country of origin, and age of the wine, as well as how it matches the foods being eaten alongside it.

    How a Club Meeting Should Work
    If you're ready to start a wine club, you may be wondering about the practicalities. Here are some tips.

    Aim to meet once a month.
    Assign duties for a particular meeting before the actual meeting is held.
    Choose a host.
    Assign someone to pick up the wine.
    Choose the wines to be profiled.
    Determine how many will attend the meeting and order wine based on those numbers.
    Find members or experts to present information about the wines. Consider inviting a wine shop owner or local chef or sommelier.
    If you can't find an expert presenter, research the wines. A good place to find factoids on wine is at the official web site of the American Wine Society. You can also talk to the salesperson in the spirits shop about the particular bottle
    Wine club meetings usually occur over a time period of two to three hours, with a 30-minute socializing break after the discussion and tasting of the first three bottles of wine.

    • SkMed on 14/01/2019 - 07:24

      Haha, the wine club I have in mind is quite different to what you've just described. Thanks though.

  • PlasticSpaceman on 14/01/2019 - 08:22
    +1

    Things is crook in Tallarook? Actually it does look beautiful. It might be easier to lease the vineyard out and operate the new house as a B&B but I think your idea is really interesting and that you would have no trouble finding people willing to take up the offer. If you do it, definitely would recommend splitting the yield evenly over the shares, and leave at least one share for the family.

    • SkMed on 14/01/2019 - 09:43

      haha, yes, things are crook in Tallarook! Tallarook is also making a bit of name for itself lately with Boogie and Ney Years Evie festivals, the new refurbished pub and the the Tallarook Rail Trail, so the timing of this idea seems good.

      Yeah the easy option might just be to to a B&B setup, then lease out the vineyard to another winemaker to manage.

      If we did the wine club idea we would most likely keep a tiny section for ourselves, but wouldn't be much as none of us actually drink wine outside of an occasional glass. But it is nice having some aside for friends, family, gifts etc.

      • PlasticSpaceman on 15/01/2019 - 08:34

        I think you just answered the question yourself. I'd consider taking up a share, but if none of the family are really all that interested in wine then you probably should just let someone else take that on. A vineyard needs a lot of work with consistent management and overview. Reviewing how the vines are growing and the quality of the wine being produced, making hard calls on pulling out vines, changing varieties etc. Employing someone to do that for you would increase costs more, and no guarantee that person will be there for the long run. People taking up shares may also have no idea how much crop yields and wine quality can vary season to season due to weather, insects, etc and take their anger out on the family…. and yes, 15 families all trying to get two weeks at christmas is going to be a huge challenge.

        Lease out the vineyard (you will probably still get some wine from whoever leases it) and put the house up for short term rentals/b&b. The costs of maintaining the property will be covered and you will get some extra income to share (maybe put in a trust for the kids) and with four families you can also use the new house for large gatherings.

        • SkMed on 15/01/2019 - 10:11

          Well the idea would be that since we all work we would still employ someone to manage the vineyard. the cost of their employment would be covered by the club fee. Sure if one of us wanted to work the vineyard and take on that roll we would save some money, but none of us currently want to do that as we have our own careers. Possibly in the future it might be a possibility though.

          We have all worked in the vineyard in the past and grew up there so we know how much work it takes. Its honestly not a full time job as its only 15 acres. Its hard work, but not full time.

          I thought about the holiday situation and had a potential solution for that above. Limit stays around school holidays to maybe 1 week blocks. Xmas time only like 3 or 4 days, each year you cannot book out the same holiday period as the year before, limit public holiday booking to one per year etc. It's not perfect, but i think it could still work.

  • chumlee on 14/01/2019 - 14:32

    You will need to lodge a prospectus with ASIC for your idea, prior to marketing it.

  • savage bargain on 14/01/2019 - 14:36

    To be honest, at that volume of wine, the people would REALLY have to like the wine or be able to onsell it. A lot of wine lovers have a few favourites, so wouldn't want to be locked in. That being said, there probably are some people who would like that - but I have doubts they are OzBargainers. You'd had to put feelers out in another forum (perhaps a wine lovers forum?).

    Could you set it up as a wedding venue? Weddings at wineries seem to be on trend.

    Or set up a restaurant/open cellar with accommodation options? People also like country stays at wineries.

    • SkMed on 14/01/2019 - 14:43

      I imagine with that volume of wine it would most likely be small/medium business owners who might like their own company branded wine for employees and clients etc. Or yes, the possibility of on-selling their wine.

      Yes, I doubt oz bargainers would be the interested themselves (although that being said I have already had some PM's from people interested if this goes ahead haha), but was more throwing this idea out there to gauge peoples thoughts, or maybe they would bring up anything I might not thought of, throw ideas around etc.

      Im looking into other forums where I can put this idea up to gauge interest, however i'm a little hesitant to go directly to a wine specific forum as they might steal the idea haha. Probably not, but yeah thought id try here before doing that.

      The house is big, so weddings could be possible, and I have given restaurant idea some thought. but the more layers I try to add the more complex it will get obviously, so I think the club might be a good start, possibly more in the future if it goes well.

      Thanks for the tips though!

  • chuckles89 on 14/01/2019 - 15:09

    firstly, sorry to hear about your father. Whilst new business and new ideas are definitely a risk. I think it sounds pretty fantastic. You probably just need to do a bit more research (which i am sure you are currently doing) and work out the complete logistics and risks.
    As someone in the forum mentioned previously, you would probably need to simplify the concept a little more and find a target audience.
    someone also mentioned about the wine club which i think is also a good idea (getting your 'share holders' a little bit interactive)
    sounds like a 'time share concept with the added benefit of leasing? (is that the right term?) part of the winery for them to use and either sell or consume'

    • SkMed on 14/01/2019 - 16:46

      Thanks,

      Yes, really at the moment isn't much more than one of several ideas we have for the place.

      Really though since we will already own the vineyard and there is a big house which will now be sitting there un-used then I don't see the risk being too high, especially if we have a little bit of inheritance off the bat as a fallback too. If the whole thing didn't gain enough interest to work then worse case we could just revert to doing a simple BnB and lease the whole vineyard out to another winemaker/vineyard or look into other options such as selling even. We would maybe be out of pocket a little for spending time researching, promo and a few other small expenses.

      And yes, I'm kind of looking at it like a time share with extras. haha.

  • pennae on 14/01/2019 - 15:39

    How about a b&b that can also act as a training centre / short placements for TAFE students in wineology? I mean, uh, viticulture.

    • SkMed on 14/01/2019 - 16:33

      The nearby tafe does things like this already I think. But worth adding to the list to investigate. Thanks.

  • Gumster on 14/01/2019 - 17:09

    This sounds like a great idea, however
    with 15 people in a timeshare arrangement I can see disagreements arising over there 2-3 weeks usage. You could almost guarantee that people are going to book out the school holidays and Christmas break years in advance.
    If you let people only come for short periods long weekends or anything short of a week. You are wasting your time
    with Cleaning and preparing the property

    You would probably be better off running a traditional BnB or using it for corporate retreats.
    Or spend some money and set it up as a wedding venue

    • SkMed on 14/01/2019 - 17:32

      Yes, i'm sure long weekends and holidays will be popular and sought after so that would be something we would need to think about. Possibly limit each memeber to public holiday stays to one public holiday period each per year and unable to book the same public holiday in consecutive years etc.

      However because it is so close to Melbourne I imagine people are going to be interested in using it for regular weekends more so. With 52 weekends in a year that would average out to members being able to use it for at least 3+ weekends of the year theoretically. Its easy enough to get to on a Friday evening then drive back to work from there on the Monday morning straight down the Hume.

      I don't think there would be any more cleaning/preparing involved than if it were a traditional BnB, in fact there would probably be less and we would know in advance when guests are coming as opposed to a traditional BnB where people could book last min. With the 4 of us I think we could handle the cleaning/prep, but if not i'm sure we could get a local cleaner when needed for a reasonable price which we would factor in of course.

  • movieman on 14/01/2019 - 17:40

    Go for it.

    Lovely area, great idea.

    PS. I enjoyed reading your first post, then the travel response (great photos), and now this.

    Very good photography!

    • SkMed on 14/01/2019 - 17:51
      +1

      Cheers! If we go ahead at least we know we don't have to worry about paying anyone to create the promo material (or any online, social work for that matter) :)

  • ribze1 on 14/01/2019 - 20:22
    +1

    No value post but my dad is from Broadford :)

    • SkMed on 15/01/2019 - 10:24

      My dad used to run his engineering business from a big factory in Broadford so if he has been there for a while chances are he probably knew him as its not a big place haha.

  • MoonlapseVertigo on 15/01/2019 - 06:07

    Sell it up and make an absolute mint. Buy a mansion and don’t work, travel with the family

    • SkMed on 15/01/2019 - 07:39

      Well that's one option. But other parts of the property need work and cleaning up otherwise we would get much less than what it is potentially worth. It will probably take us a good two years to fix and tidy up the property. So we do need to do something with the new house and vineyard in the meantime. Also I don't think selling would allow all 4 of us to quit our jobs! haha

      On the other side we'd also like to keep it as it's our family home.

  • greatlamp on 15/01/2019 - 06:17

    Australians aren't going to pay much for cleanskin wine, when you can buy a bottle for around $3. There is very little money in it and likely not enough to cover expenses - it's priced low because the grower would otherwise throw it away.

    The Chinese however really rate our wine. If you can make your own brand and get some recognition for it you will be able to sell it in bulk to those looking for something unique.

    The property looks beautiful, as a B&B you will also need to landscape the property, hire a cleaner, hire a cook, manage the finances, and check on the property several times a week. Don't imagine a fantasy where you can just hire someone to manage your property and collect a profit once a month.

    You aren't alone, which of you siblings is going to invest all this time and effort to develop and manage this small business? How will you split the profits? How will you get paid for your time? What happens if it loses money, who pays?

    Honestly unless you are willing to run the B&B personally, and pay a fixed lease to your siblings I think it is just a recipe for disaster. Spend this effort researching how much the property can sell for, find out who pays the high prices and market it to them

  • BartholemewH on 15/01/2019 - 07:28

    The leasing idea is interesting and while the fixed income sounds good to start with, what happens if you don't get to 15? Are discounts then involved with some leasees paying less than others? How long are the terms?

    • SkMed on 15/01/2019 - 07:48

      If we didn't get to 15 I suppose we just end up keeping the wine from those empty acres and sell that ourselves which should recoup money lost from not having all 15 groups buy in. Possibly if there are less people/groups we could offer more time in the house to each person/group too which means we might be able to charge a little more to make up the lost income from the empty spots.

      Thing is that the vineyard is already set up and good to go, and the house would just need a little work (landscaping, finishing the decking etc.) which we are planning to do no matter what anyway. The only additional upfront cost would be furnishing the house so it's set up for guests and setting up a few other things.

      So even if we went ahead I'm not seeing any major way this could fail, worse case we have everyone drop out then have to just pay pay for the farm hand to manage the vineyard and we still end up with all 15 acres of wine to sell at the end.

  • That Guy on 15/01/2019 - 09:33

    Have you got an evaluation on possible wholesale costs of your wine?

    • SkMed on 15/01/2019 - 10:00
      +1

      No, not yet. We have had some buyers interested in bulk purchasing but we are wanting to get the wine analysed first and possibly make some better labels. Also trying to figure out if we really want to sell it all off now, or keep it to sell with the whole property, or use it for this idea etc.

  • Herbse on 15/01/2019 - 09:38

    I'm a little confused.

    Do they own the 1 acre of land? Legally? And can they sell it later on, like an investment?

    Or are they paying $10k a year for a 2 week holiday home and 2000 bottles of wine? What do people do with so much wine? Can they sell it? Do you sell it for them?

    Sorry, maybe it's because I'm not a wine person. But I'm struggling to see if this is a holiday, investment, or share buying into your company.

    • SkMed on 15/01/2019 - 09:52

      No, to own the 1 acre the property would need to be sub divided which isn't possible. They would be leasing it (renting it if you will) on a year to year basis. If they wanted out I imagine there might be an exit fee of some kind, but we would manage finding new members.

      So yes, essentially 10k a year gets you a 2 week holiday (possibly more), a lease on 1 acre of vineyard (bragging rights for wine people), Possibly naming your section with a sign (Herbse's drop etc.) ability to also just pop in for a visit when ever (to show off your vineyard), experience learning about the vineyard/wine/work etc, a day picking if they wish (people actually find this fun with the family etc.) and a day making wine the old way (more about learning, squashing grapes with your feet etc.), designs and labels for your wine, and of course about 2000 botlles of wine each year, as well as 200-300 bottles of the 2007-2009 wine on signup.

      2000 bottles per year is too much for personal consumption obviously haha, but the idea is you could then have your own wine and also market and sell it, or even gift it to employees/clients etc. if you are a business owner. You can do what you want with it. But it is a good drop which my dad was selling for $10 per bottle previously, so theoretically if you can find a buyer at $10 a bottle you'd be making a profit of $10,000 too. Or sell it at $5 a bottle and then you break even…

      So really its a bit of all 3, holiday, investment, and share buying.

      • Herbse on 15/01/2019 - 12:04

        It feels like you have two different audiences. People who want to relax and people who want to make money from it.

        I couldn't see the people who earn enough to pay that much having the time or resources to sell on their wine themselves. And I couldn't see someone wanting to make a profit from it wanting to pay a premium just for temporary residence at the business.

        If you struggle to find people for your initial idea. Maybe split it into two seperate businesses for yourself. One where people can stay, for a cheaper price. And one where people can invest in the wine and sell it on.

  • abb on 15/01/2019 - 09:53

    Feedback on a business idea in the form of discussion with people who were never going to buy in is basically worthless.

    Try and sell your scheme. Throw together a web page with some photos, a description of the scheme (including the price!), and a "sign up" button. If people click on the button, it should collect their email address and some other details, then let them know they've been shortlisted for consideration and will be contacted by date x. On date x, you check if you have enough sign-ups to be viable.

    • SkMed on 15/01/2019 - 09:58

      Haha, well I thought so too… surprisingly I've had several PM's with people interested just from reading this post.

      I never intended iron clad ideas here, just spitballing really. Next step would definitely be pitching to a wine forum of some kind. And yes, then from there if my siblings are on board I will set up a site,do some promo photos, video, info etc (I literally do this stuff as my day job so I can do all that blindfolded). Thanks for the suggestions though.

      • abb on 15/01/2019 - 11:59
        +1

        Ask them for payment info ;)

        Forums are good for spitballing, that's certainly true. Good luck with whatever you decide!

  • iTzPossible on 15/01/2019 - 09:53
    +1

    With something like this, Ozbargain is an ok place to ask, but you need to have the ability to pick the top comments from the average comments. Most comments are going to be average and possibly lead you down a terrible path, even the most upvoted. Most people on ozbargain have 0 experience dealing with your problem in the first place. Because the normal distribution suggests that most people are going to give average advice, then it's also likely to think that most people think in a similar way and will upvote suggestions that are also average. So the most popular comments are also not necessarily what you want.

    Wishing that you will make this a success, my first suggestion would be that hopefully your father being someone who owned such an asset would have been long term friends with other business owners/investors of a calibre that could give you much much better advice than a web forum. Ask them first, take them out to dinner, buy them some gifts, it's for sure worth it.

    Secondly, I am actually in the wine industry, on the retail side though.
    If you have no experience, selling the place is a good option. Before you could get a great price if you found the suitable buyer (many chinese investors around but perhaps not anymore).

    Near the hume highway, doesn't sound like it's a the most sought after place for wine production.

    Really, suggestions given to you need to be based on your business experience and current level of wealth more so that your idea.
    If you have accrued a few million in assets already personally, then your ability to judge the idea and actually run the business will be a lot better than if you have only worked in a job most of your life. Business is not easy, starting something new will usually take at least 3x longer than what you envision, and most start ups fail. There are great ways to avoid this failure, but if you're not willing to learn these things it's not worth starting it and I recommend selling the whole thing.

    Happy to answer any questions if anyone has any.

  • TimOfEastBNE on 15/01/2019 - 11:12

    Interesting idea, sort of a time share winery… would you imagine members could pass their allocation of accommodation on to others?

    • SkMed on 15/01/2019 - 11:24

      Yeah pretty much.

      No the advantage of this idea is that we would know who is staying and coming/going from the property (my brother is a bit paranoid of randoms coming and accidentally starting a fire etc.). That being said It makes sense that members could bring who ever they want with them, maybe extended family, or a few friends etc. But I think the member would actually need to be there. Also they'd be liable for any damage/issues outside of normal wear and tear obviosuly so I doubt people would want to take that risk.

      That being said, I think the idea of a group of friends potentially gong in on a single acre together could also work. Maybe several close friends leasing one acre together and splitting the stay, cost, wine etc.

  • Powderhound303 on 15/01/2019 - 13:19
    +1

    I’m a wine collector, and like to visit wineries etc on weekends away.

    No one else does what you suggest about a wine club etc because it’s not popular or a good idea. I’ve looked into doing this type of thing but with log cabins.rather than a big house. People like their privacy and space.

    Just sell up or lease out the new house and winery. Also there’s more wine in this country than you poke a stick at so unless your winery is someone super special I think it’s hard to sell the wine.

    Best option is to set it up as a BnB for weekend get aways for couples. Make it dog friendly and put a big bbq in there, plus fire place for winter. Best of luck.

    Sorry for the loss of your father.

  • belongsinforums on 15/01/2019 - 13:24

    There are plenty of small wineries around. See if you can make friends with the people there

  • RolandWaites on 15/01/2019 - 13:34

    Who has room for, or wants, 300 bottles of wine?

    Make it 40 and that'd still be plenty.

    • SkMed on 15/01/2019 - 14:30
      +1

      I'd imagine the market for this would be fairly well off families/people who have an interest in wine but don't have time (or money) for their own vineyard/farm. I know a few people in the city who have had hobby farms in the past but end up selling them due to the time required to maintain them.

      These people might want to try their hand at marketing/selling their own drop as a hobby, just have their own wine as a bragging right, or maybe small/medium business owners who can gift wine to clients/employees and that sort of thing, because at the end of the year they'll potentially end up with about 2000 bottles of wine.

      Or alternatively the other market may be groups of friends/families buying into a single subscription/acre/membership together. So maybe 6 friends splitting the $10k cost and then they end up with 50 bottles each to begin with, then 300 or so each year going forward.

      Those are the two markets this would be aimed at.

      If you pay 10k for a membership and sell your 2000 bottles off for $5 each you have already broken even, plus gotten a free holiday house to stay in plus the other perks. Sell them for any more than $5 a bottle = profit. haha.

      • RolandWaites on 15/01/2019 - 15:21
        +1

        It would take a lot of work to sell 2000 bottles of wine at $5 each. Can you do that if you aren't licenced?

        If you did manage to break even, you'd still have a time deficit - all the hours you spent persuading people to buy your unknown brand.

        Perhaps if you're really sold on the idea, consider going down something like this route: https://www.nytimes.com/2019/01/03/dining/millbrook-winery-a…

        That'd be a huge job, but it would seem more sustainable. Take advantage of the premises you have, and have the wine-making element a positive sidekick to the attraction. Tastings, maybe a bottle over lunch, if you're lucky some customers might buy a couple as they leave. Realistically, I don't know if people are going to want to pay a recurring $10k a year to get 300 bottles of a non-branded wine.

        • SkMed on 15/01/2019 - 16:42

          You can get a sellers license and its quite cheap, only a few hundred.

          FYI, The 10k would get you 2000 bottles a year not 300.

          • RolandWaites on 16/01/2019 - 12:01

            @SkMed: 2000! Blimey..

          • iTzPossible on 17/01/2019 - 11:44
            -1

            @SkMed: I thought you were on here to get feedback and to actually take it on board. Instead it feels like you're not listening to suggestions and rather just looking for evidence that your idea is in fact a good idea.

            Have you had any experience selling?
            As RolandWaites says, who is going to go out of their way to get a licence so they can "help" you sell 2000 bottles of wine??? for what profit? Most poeple who have the time and money to do it, are making much more money doing other things. The people who may actually think it's a good idea because of their lack of experience are not capable of pulling it off, that's why they think it's a good idea in the first place.

            If you really want to try this, then just go out and start selling it. Sell the idea and get pre-commitments with deposits. You don't need to have all the wine produced to start doing this.

            There's no point coming on Ozbargain to try and prove your idea is a great one then losing massive amounts of value when you actually do it.

            Since you actually have a nice asset, either sell or find someone to manage it and LEARN from them.

            Quoting you:
            "I'd imagine the market for this would be fairly well off families/people who have an interest in wine but don't have time (or money) for their own vineyard/farm. I know a few people in the city who have had hobby farms in the past but end up selling them due to the time required to maintain them.

            These people might want to try their hand at marketing/selling their own drop as a hobby, just have their own wine as a bragging right, or maybe small/medium business owners who can gift wine to clients/employees and that sort of thing, because at the end of the year they'll potentially end up with about 2000 bottles of wine."

            Those huge assumptions and if they don't hold up? Do you think small business owners are going to jump at the possibility of 2000 bottles of wine so they can gift that many, because they are thinking about this all of the time? Sounds much more like a headache when wine is so accessible through other means. I'd need a huge advantage if you wanted me to buy 2k at a time and not being in the wine industry.

            I know quite a lot of people who ship many containers of wine to china, we have groups of people who sell millions of dollars of wine per year, you need to get in contact with people who are experienced in the wine industry and actually listen to them. So many new wine producers try their hand every year, and 99% of them will struggle.

            • SkMed on 21/01/2019 - 10:38

              @iTzPossible: Not sure what you are reading exactly… I've taken several suggestions from here on board and noted the opinions and pitfalls mentioned above to discuss further. Are you suggesting I just scrap the idea due to a couple of people here thinking that no one would be interested in having/selling their own wine?

              Quoting me:

              "The nearby tafe does things like this already I think. But worth adding to the list to investigate. Thanks

              Oh, sorry, yes totally miss-read that! Yes true, a traditional BnB might be better. I'll add it to the list to discuss with the fam. Thanks for pointing that out

              Yes true, B&B would probably be easier. Then just lease out the vineyard. At this point its probably the top of the list, but the wine club idea isn't far behind.

              Yes, that is also an option

              Yeah a B&B and then just leasing out the whole vineyard to another winemaker might be the easiest thing to do I'd say

              If we did the wine club idea we would most likely keep a tiny section for ourselves

              Yes, really at the moment isn't much more than one of several ideas we have for the place.

              Yes, i'm sure long weekends and holidays will be popular and sought after so that would be something we would need to think about.

              That's one option

              Next step would definitely be pitching to a wine forum of some kind

              Yeah pretty much."

            • SkMed on 21/01/2019 - 10:41

              @iTzPossible: "who is going to go out of their way to get a licence" - Its actually easy and inexpensive.

              "I'd need a huge advantage if you wanted me to buy 2k at a time and not being in the wine industry." - I think you're missing most of the point of the idea. You more than just the 2k bottles of wine. People also value experiences.

              "for what profit?" - Selling bottles for at least $3 each is easy, I've already been offered $3-$5 per bottle for our current stock without any work at all. at $5 per bottle you are already breaking even.

              "If you really want to try this, then just go out and start selling it" - I have actually already had interest from several people/groups on Ozbargain and from collegues and friends of collegues interested, so I can already confirm that there are plenty of people are interested before I even test float the idea properly.

              "Sounds much more like a headache when wine is so accessible through other means" - As far as I can tell though my research so far there is no way for someone to be able to lease their own small slice of vineyard and then receive 2k bottles of wine from said vineyard plus everything listed above. Again, you seem to be focusing purely on the bottles of wine aspect and missing the point of the idea.

              Thanks for your input, but maybe re-read the description :)

              • iTzPossible on 23/01/2019 - 09:29

                @SkMed: i know you might see what i'm saying as off point.

                my main point is your own business experience, if you don't have experience you might find yourself instead of having a valuable asset, stuck in a business idea that never takes off but are invested in without a good way out. If you have been successful with other ventures then you can see many of the potential issues with this idea already, if you have no experience you need to get humble or your going to lose a lot of money.

                have you ever managed a payroll? (just one of the many potential headaches if done incorrectly)

                i have nothing to prove i just don't like seeing people go from a good financial situation to a bad one. i'm generally quite an optimist.

                seems you didn't read my main points either.

                lease small slice of vineyard + 2k wines, why commit to that when I can buy the wines through retail outlets (more variety and not more expensive at that volume), and then just pay for hotels or other airbnbs when i need them. if you go the airbnb idea is it.going to return better money than outright sell?

  • futureminime on 20/02/2019 - 19:30
    +1

    Looks like a plan. Just a couple notes:

    1. The 300 Bottles at the start of your membership would help clear the current cellar, but remember that this offer won't be available every year (unless you claim a portion from every 1acre). I would think it might be nice to take an small number from each section of the property

    2. Will have to put rules into place around what happens if one of you wants to sell your share (or heaven forbid one of you or your siblings pass unexpectly)

    3. Similarly above, have to work out rules around fairness for the people leasing. What happens if half the acres get burnt in a bushfire? What if half don't produce fruit? Who gets priority leasing from year to year?

    4. In one of the other posts you mention the option for lessees to sell the wine to cover costs. It may be worth you negotiating an option for you to 'buy them back' - Discount off the next year's lease.

    5. Remember that 15 people + 4 families of the siblings = 19 * 2 = 38 weeks of the year. Considering peak periods ( public holidays, school holidays etc) will be in demand it may be difficult to fairly allocate time.

    • SkMed on 21/02/2019 - 13:07

      Thanks for the feedback!

      1. Yes, thats true, the 300 bottles would be for the first people to buy in as an incentive. We would also keep a small section for ourselves or take a small portion of each acre to refill our stock which would in turn be offered to new members wanting to buy in in the future.

      2. Yes, for sure.

      3. I believe insurance would cover this, but need to do some more research on this front.

      4. Thats a great idea which I hadn't considered! Noted.

      5. Us 4 aren't included in the house usage as there is a second farm house on the property which my siblings and I use, so we have no need for the large new house. And yes, peak usage is something that we discussed above, there are a few ideas I mentioned above to divide the peak times up fairly which I think could work.

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