REthink Wine Blog

Anyone in the wine industry knows full well they did not get into the business because of an unabashed love of compliance work.  Without sounding ridulous, wine is an alcoholic beverage and the production and distribution thereof is one of the most heavily regulated industries in the United States.  Unfortunately, winery compliance isn’t nearly as much fun as producing (or consuming!) a fine bottle of Cabernet Sauvignon.  Nor is it as much fun as watching the income generated when that bottle sells to an appreciative audiance.  Let’s be honest, the income side of the business equation is always more exciting than the cost side. 

Bad Idea

The problem with this equation is it results in bad business practices.  Make no mistake, producing and distributing wine is a business.  At least if you want to do it for long!  There is a natural inclination to give short shrift to the less pleasant part of the business.  Compliance - the ugly stepchild of the wine industry.  People have such a distaste for compliance that they even give it a backseat to paying the bills! 

Now I’m not here to say that compliance can be fun and we should all love it.  However, I am here to say that relegating compliance to the last seat at the dinner table only furthers the notion that compliance is some horrible task with which to deal and that’s a bad idea.

Compliance is not that hard.  It just requires organization.  As with any business task, it needs to be scheduled and maintained.  Too many times it is treated as an afterthought and not taken on until the last minute.  Attempting to gather your numbers for the previous month just before the due date is a mistake.  It’s also stressful and it often leads to calculation errors and over- or under- payment of taxes. 

You certainly wouldn’t want to approach a sales opportunity unprepared at the last minute and you shouldn’t do so with winery compliance either. 

Planning Makes Perfect

Whether you are filing your monthly TTB 702 report or your state excise tax return for North Carolina, schedule the task with enough time so that you can review your work and accommodate any unforeseen problems without pulling your hair out.  Scheduling and planning will make all of the difference. 

• Schedule a time to do the work with enough time before the deadline.
• Maintain the appropriate sales or production data over the course of the month so you don’t have to throw it all together at midnight on the last day of the month. 
• Organize your data file in such a way so that much of the work is already done for you in the data input process.

Just Another Business Cost

One last thing about compliance and taxes.  Taxes are just another part of your cost structure like any other element of your production and sales systems.  When making price determinations for your product, remember to include the likely excise taxes you will incur in your intended markets.  Florida has very high excise taxes which should be accounted for while the reverse is true for a state like California.

In the end, compliance is just another part of the wine business we all love.  Don’t let it scare you and don’t let it overwhelm you.  Just plan appropriately and the burden of compliance won’t seem so bad.  Remember, REthink Compliance is there to help.  It is the place to find the rules of the road, so to speak, for state shipping laws, perform compliance checks before you ship, and create the reports needed to stay compliant.  Now, go do the fun part…make wine!

This entry was posted by Matthew Mann on Friday, September 5th, 2008 at 10:55 am and is filed under Compliance. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.