A small vineyard can be profitable with careful planning and dedication. Profitability depends on climate, grape variety suited to the region, soil type, sun exposure, nearby vineyards and required equipment. The average price of a California vineyard is $150,000 per acre. Location is key. A 35-acre vineyard earning $2,500 per acre yearly sees $88,000 profit. The minimum size for a profitable vineyard business is 5 acres. For the wholesale market, 10 profitable acres are needed. More acres improve economies of scale.
Wine Production Potential
Many vineyard owners open onsite wineries despite higher investments and costs since profits are higher. Vineyard managers average $94,000 annually. Wineries average two to three times wholesale costs for markups. One vine produces 4-6 bottles yearly. Cabernets have the most global vineyards. Costs to run an acre of vineyard are $5,000 yearly. Yields of $11,000 worth of grapes per acre are possible.
Costs and Considerations for Starting a Winery
Planting costs range from $30,000 to $100,000 per acre. To start a winery today costs a minimum of $600,000. Safely shipping wine is key to a successful operation. Estimated yields of 3-5 tons per acre are considered best.