Like everything else you invest in at cellar door, your merchandise range needs to reflect your brand image effectively. Many cellar door operators worry that sales of merchandise may detract from sales of wine.
Whether they do or not depends more on the way you present the merchandise, what you stock and who your visitors are. Effective merchandising should result in sales of both wine and product.
What percentage of sales is likely to come from merchandise? The answer to this varies considerably depending on your level of brand awareness in the market place, the range and quantity of merchandise you stock, your visitor profile, your location and even your proximity to the visitor's usual place of residence.
Branded merchandise works particularly well if you already have a well-known brand, while for others branding things like clothing prominently with the region's brand might work better. A broad product range and plenty of stock can equate to a higher percentage of sales because you are likely to have "something for everyone." And if your visitors are from overseas, they may prefer to take small items with them as a memento because carrying or shipping wine is too difficult or price prohibitive.
Research suggests that the percentage of merchandise to wine sales at cellar door can vary from as little as below 5% to as high as 40% in some overseas cellar doors. You need to decide what percentage of sales you are aiming for and build a strategy around that. Most wineries that are serious about merchandise aim for between 10 and 25% . The margin can vary from a low 20% on higher ticket items to more than 100% on high-turnover low-cost impulse buys.
Building a successful portfolio of products is not a set and forget exercise. The market is constantly changing and what sells really well one year may flop the next. Wine charms are a good example. According to several Napa Valley wineries, they were the "in thing" two years ago and demand always outstripped supply. Now they barely move. Instead 6-packs of small, colourful wine glasses are the current rage. And it is likely to change again next year.
The point here is that you must constantly test the market. Slow moving and obsolete stock is money wasted in inventory that's not generating revenue. Turnover and cash flow are critical to ensuring your merchandise provides a positive income stream and contributes to the bottom line - while enhancing your brand.