So a winery carries debt like no other business that I can think of. Given that nations in Africa carry debt like no others in the world-I thought it might be a good idea to try and put the two of them together and find a workable solution for Africa by looking at how the wine industry behaves.
First, the average winery has to have a two year lag between creating their first wine and when they are able to sell that same wine. Wine often spends over a year in a barrel (which runs the winery about $1200 by the way) and then another year in bottle, before it can be sold.
As you might expect, that is a rather large undertaking to say the least.
I think we all know that the idea behind the IMF is pretty simple, it is suppose to help 3rd world countries with investment in order to help them grow their respective economies, while creating long term jobs.
I was talking to a guy who imports some of the best wine gifts from France every year and he was telling me that he’s heard that certain industries, with wine being an example, that are completely exempt from being able to receive funding.
Given that the best performing region of the American economy right now is California and San Francisco in peculiar, I have to wonder if that’s a smart choice. While SF certainly exists largely because of Silicon Valley and the tech industry, the wine and larger food industry has employed millions of people, while helping to grow a locally grown movement, further enhnacing the local economy.
Given some of the challenges with the IMF, it’s worth a shot isn’t it?
Most people don’t realize that a red wine sits in barrel and then bottle for well over 2 years on average. In terms of debt, you have to pay for grapes for over 3 years before being able to sell a single bottle of wine.
For those companies doing a large percentage of wine gifts and wine gift baskets like http://www.uncorkedventures.com/WineGifts it evens out a bit, but overall it is a bad way to try and earn a living don’t you think? Think about a bank having to do the same thing….you buy a house and live in it for 2 years without making a payment. It just seems crazy doesn’t it? In wine, that kind of debt is the only way to be in business-so everyone does it!