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Napa Wineries

Confidential Business Review
PURPOSE: The purpose of this Confidential Business Review is to acquaint a prospective buyer with preliminary information regarding a client (Seller) of Business Brokerage Technologies, Inc., dba BizEx. The term 'BixEx" shall refer to its employee's, agents, brokers, financial re-casters, and affiliate brokers of Business Brokerage Technologies, Inc. DISCLAIMER: The information herein is furnished by the Seller; BizEx has not verified this information and makes no representation or warranty as to its accuracy, completeness, or authenticity. Future earnings may differ from past earnings. Discretionary Earnings is defined as earnings before deducting interest, taxes, depreciation, and amortization, and adding owners' salary, benefits and non-recurring expenses. ACCEPTANCE: By accepting this Confidential Business Review, the Prospective Buyer acknowledges the responsibility to perform due diligence review and make its own evaluation and judgement of the business prior to any acquisition or mergers with the Client Company. PROPERTY: This document is the property of BizEx and represents general information about a business opportunity that BizEx represents on an exclusive basis. CONFIDENTIALITY: This document is not to be copied or distributed, nor should its contents in any way be divulged to anyone, as it may contain highly confidential financial and operational information; and reports that are considered trade secrets by the Client Company. If you need additional copies, BixEx will provide them upon qualification of the recipient. If you receive this as a potential financing source, you are obligated to keep the information herein as confidential as possible and are to use it only for making a lending decision. The bearer of this presentation is responsible for its confidentiality. This information must be held in absolute confidentiality. Any party reviewing this material be held liable for its improper disclosure and could be held liable for damages if such disclosure proves in any way damaging to the Client Company, its owner, employees or suppliers, or to its principals or agents. PLEASE DO NOT CONTACT THE CLIENT: All contacts with the Seller require prior approval of BixEx. Failure to adhere to this requirement will jeopardize the prospective buyers' ability to pursue this opportunity.

The Cellars' Expertise Goes Back 40 Years

 

1978

Entered Viticulture Industry

Owner starts viticulture career in Sonoma County in the Russian River Appellation

1999

Napa Vineyards

Napa Wineries begins operation on 20 acres in east valley.

2010

Napa Wineries

Owner starts producing her own wine under Napa Wineries brand

2011

Tasting Room Opens

Napa Wineries starts leasing property for Napa Wineries tasting room.

Strong Foundations

Water well with perpetual rights for 44 feet acres of water consumption per year 17.2 acres planted 5,000 sqft building with sleeping quarters, kitchen, living room, and large wine production facility 100 miles from San Francisco

Market is increasingly favoring small wineries

Consumers are leaving lower price segments and progressing toward premium wines, which are expected to grow 4-8% in 2018 Millennials are favoring premium small-production scale wines Gen X's can afford premium wines Market Values per ton continue to grow across all market segments The market is developing towards direct to consumer sales: larger profits through increasing revenues from tasting rooms, wine club sales, wine tours, etc.

Clearly there is competition...

Napa Ridge Vineyards

Barone Family Vineyards

Coruce Vineyards & Winery

Donato Family Vineyards

Golden Star Wineries

Sambridge Vineyards

Triassic Vineyards

 

...but Napa Wineries wines are noteworthy

2014

Syrah-Gold Award, Merlot-Silver Award, Zinfandel-Bronze Award

2016

Syrah-Silver Award, Viognier-Silver Award

2018

Cabernet Sauvignon-Silver Award

Unfortunately, the winery relies on quality alone...

 
  • Quality of grapes and wines is truly exceptional
  • No marketing investment
  • Tasting room is only sales channel
  • Grape demand far outweigh supply
  • Award winning wines
  • Excellent customer reviews

Development options show promise

Additional income of $960,000 if all grapes were used for wine production at the current prices Alternatively, close to $50,000 in additional income if the grapes would be sold at market prices Currently no spending on marketing New sales channels: wine club, non-retail sales, and restaurant sales 10% yield increase from the current 3.3 tons per acre would not affect grape quality Additional 4 acres available for expansion Tasting room location can be improved and the opening hours can be increased from 28/week Revenues can increase up to 900% without price chanfes

Winery is well positioned for growth

Strengths

Secure water supply

High quality of wine

Excellent reputation

Less susceptible to disease

Support from current owner during transition

Weaknesses

Lack of marketing

Undeveloped sales channels

Low Utilization of operational capacity

Low brand recognition

Current TR location not ideal

Opportunities

Increases in grape and wine production

Potential for wine tours from San Francisco

Price increases

Moving tasting room to other location

Threats

Impending globalization of wine supply

High competition

Decrease in baby boomer business

Legacy

Current owner is offering an entire year of no-cost training at 20 hours/week in order to preserve legacy and reputation of the vineyard

The Value is Truly Exceptional

Outstanding quality of grapes and wine Potential wine sales exceeding $1.3 million Short distance from the most affluent parts of San Francisco Comprehensive free training by the owner Limited seller financing available