Co-op Tasting Room

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Allan Kyle

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I have a wonderful, quaint, and very old property in a wine making region of PA. It happens to sit right at a very highly visible road frontage and which is heavily trafficked location seeing hundreds of thousands of annual tourists. There are at least 10-20 wineries in the immediate vicinity but nearly all of them are in much more remote areas (for obvious reasons). As the location is already zoned as a winery, I was wondering if I should contact the local wineries to see if they would be interested in a co-op tasting room?

If you had a winery, would you think that an interesting new outlet for your wine? Or will they all think I am bonkers?
 

GreginND

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Often times state and local laws prevent this kind of operation. For example, here in ND my license ONLY allows me to sell wine at the winery without a special 1 day permit from the state. Those permits are limited. Also, because of the three-tier alcohol system in the US, I am unable to own or operate another alcohol retail store. Thus, it is very tricky. I don't know what the state and local laws are in your area. That being said, I would, as a winery, be interested in more outlets like this for our product!

If you are not a winery, perhaps you could get a retail license and source local wines to sell in your store.
 

Allan Kyle

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Thanks. Recent law changes in PA seem to make this sort of thing viable, although I would need to register as a limited winery (nominal $750 cost). That was the recent impetus. As a novice winemaker myself, I would just jump at the chance to engage with the other local wineries.
 

jgmillr1

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As the location is already zoned as a winery, I was wondering if I should contact the local wineries to see if they would be interested in a co-op tasting room?
As @GreginND said, it depends on the state laws. In Indiana, we can have up to 2 offsite "satellite" facilities that can sell wine made under the winery permit. Probably should check with the local excise police district or winery on relevant laws.
 

Allan Kyle

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As @GreginND said, it depends on the state laws. In Indiana, we can have up to 2 offsite "satellite" facilities that can sell wine made under the winery permit. Probably should check with the local excise police district or winery on relevant laws.

Thanks. In PA, we can have 5 satellite locations, as well as buy and resell up to 50% wine from another PA winery. The law allows for just this sort of co-op and relaxes rules on staffing and paperwork to encourage it.

when I first approached local wineries many years ago (prior to the current law), I got a bit of a cold reaction. Could have been the law, could have been who I caught on the wrong day. But that is why I came here to see if the idea had merit.

would you join a co-op tasting room?
 

Ignoble Grape

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We have one that is operated out of an industrial park - literally just a whole in a garage building - there are 6-7 small-scale wineries that come together and open up the garage and surrounding driveway area the first Saturday of the month, they have small bites to eat, live music, chairs, etc. - huge success, they move tons of wine. Customers pay $15 for a glass and 9 pours, they can keep the glass and come back next month and only pay $10.

There's variety, the winemakers are there, family friendly - and it's out off the beaten path. If you have visibility, people will come, as Nor Cal states.
 

Allan Kyle

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Thanks for the responses. I'll reach out to the local wineries, perhaps through the association and see if I can get a couple on board for starters.
 

Carolyn P

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Thanks for the responses. I'll reach out to the local wineries, perhaps through the association and see if I can get a couple on board for starters.
Where are you located in PA? Sounds like an awesome idea! (I’m a novice winemaker in Pgh area.). I’d visit!!
 

Allan Kyle

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Southeast PA. I am trying to figure out why I got the cold shoulder first time I tried this a while back.
 

peterseng

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As @Carolyn P said above, I'd love to visit and think it's a great idea (and I don't see why, under the newer law local wineries would not be interested... at least some of them)
Please keep us posted on the progress of this. I am curious about it for a couple of reasons...
 

jodie

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A co-op tasting room is a pretty good idea, although I can see some challenges that you might come across like training the staff so that they are familiar with each winery, those other locations possibly not liking not being in control of how they are represented, possible lost sales or visits from visitors who would drive out to those locations. I could be wrong, it may work beautifully and I hope it does. Have you considered a wine trail at all? We are part of one and it encourages people to visit all of the wineries in the area (or at least the ones on the trail).
 

Hokapsig

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yes in PA we are allowed to have up to 5 satellite locations. When you say you're in the winemaking region, are you in the Erie area? The other wineries in your area probably wouldn't be interested as they are trying to drive business to their properties instead of a another property.
 

ffemt128

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Allan, yes in PA we can have up to 5 satellite locations. Being able to sell another wineries product is another story. See below. You are not permitted to purchase from another winery more than 50% of what the purchasing winery produced the prior year.

47 P.S. § 5-505.2
(2) Sell alcoholic cider, wine and wine coolers produced by the limited winery or purchased in bulk in bond from another Pennsylvania limited winery on the licensed premises, under such conditions and regulations as the board may enforce, to the board, to individuals and to brewery, hotel, restaurant, club and public service liquor licensees, and to Pennsylvania winery licensees: Provided, That a limited winery shall not, in any calendar year, purchase alcoholic cider or wine produced by other limited wineries in an amount in excess of fifty per centum of the alcoholic cider or wine produced by the purchasing limited winery in the preceding calendar year.

This is under the section of Board Approved Locations in the pdf below:

Two or more Limited Winery licensees can operate a shared Board-approved location. Only one manager of this location is needed. Only one application fee is required for that manager. Also, designated specific or distinct areas for each Limited Winery licensee’s licensed area are not required; however, each Limited Winery must file an application for the additional Board-approved location. A shared Board-approved location shall count as one location for each of them.

https://www.lcb.pa.gov/Licensing/ResourcesForLicensees/Documents/002130.pdf


That being said, if you were to open a location where each winery used one of their satellite locations at the co-op, there could be ways around this. I believe this is the business model PA Libations may have pursued. Don't quote me on that.
 
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