For many small wineries, success is built on craft, heritage, and the quality of each bottle, not on financial reporting and spreadsheets. But when they can get their financial information in order, they can take steps to move their business forward.
For many wineries, debt is a reality. And this is where having a good partner can make all the difference. Financial compliance becomes as critical as production; even the most talented winemakers can find themselves in unfamiliar territory.
One boutique winery, known for its site-driven wines and dedication to craftsmanship, came to us in precisely that position. They had recently secured a new business loan, a key step in supporting their growth. Though with that opportunity came a challenge: the lender required accrual-based financial statements. Something they had never expected, and a significant shift from the tax-basis bookkeeping the winery had relied on for years, as was recommended by their previous partner.
The winery suddenly faced a daunting list of problems:
- They had never tracked their true cost of production in detail for accounting purposes, spanning multiple vintages.
- They were out of compliance with their loan terms, despite operating responsibly.
- They risked costly penalties, strained relationships with their lender, and unnecessary stress.
This is now more than just a bookkeeping issue. The format of their financial statement analysis now threatened the winery’s finances, growth plans, and peace of mind. A default in this situation could have been the end of their business as they know it.
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At Protea Financial, we knew the solution required more than simply “fixing the books.” A complete clean-up spanning many years would be time-consuming and costly, with minimal benefit to their business. Our team stepped in as advisors and advocates, working directly with the lender to find a path forward. Using our knowledge and reputation, we laid out financial planning and analysis reports that we believed would be helpful to the client and workable for the lender.
We negotiated an agreement that allowed the winery to transition into accrual-based reporting over time, rather than retroactively restating years of financials across multiple vintages. Let’s fix the problem going forward, making the lender happy, and taking the opportunity to provide the client with better information to improve their chances of success.
This collaborative solution achieved three vital outcomes:
- They gained new financial clarity, understanding their cost of production and inventory cycles for the first time. – client, bank, and Protea happy
- The client remained in good standing with their bank by staying compliant with their covenants, protecting their loan and growth trajectory – client and bank happy
- They avoided significant costs and labor, eliminating the need to dig through years of historical data – client happy
For the owner, this was about more than numbers. It was about trust, relief, and the confidence to focus on their craft again. We built much trust and goodwill. Protea Financial helped them bridge the gap between wine making and compliance, enabling them to not only meet lender expectations but also gain insights that will strengthen their business for years to come.
At Protea Financial, financial expertise should empower, not overwhelm, business owners. Whether it’s navigating lending requirements or understanding the numbers that drive growth, we’re here to make sure your business thrives, not just survives.
