Vinegar Business Plan, With a Projection

A vinegar business plan is a plan for waiting. Cider turns to vinegar over two months or more in tanks and barrels, so the first bottle sells long after the first bill is paid, and the stock in the tanks is always a few months ahead of the shelves. After that, the numbers are kind: a 16-ounce bottle of raw cider vinegar holds about 70 cents of vinegar and sells for $14 at a market. In the example below, a vinegar maker in New York sells raw cider vinegar direct and to shops, fruit vinegars and gallon jugs for restaurants, sells nothing for two months, and ends the first year about $31,500 ahead on $66,900 of sales, with the bottling paid. Below is a description example, each part of the plan, the rules, the first year month by month, the startup budget, and a free template.

The short version

• Describe the business in a paragraph: the vinegars, where the cider comes from, who buys, the goals.
• Plan the wait: two months or more from cider to vinegar, with fixed costs running.
• Cost a bottle from the cider up: vinegar, bottle and label, bottling, fees.
• Test acidity and pH for every batch, and keep the results with the lot.
• Shops buy at a little over half the market price; restaurants buy by the gallon.
• Keep enough in the tanks for the months ahead, because the next batch takes as long as the last.
• TaroStack gives every batch a lot with its tests, and shows what's in the tanks and what's bottled. More below.

Part 1: the business description

Esopus Creek Vinegar Co., a made-up vinegar maker in Saugerties, New York, I use in these examples, writes:

Esopus Creek Vinegar Co. ferments raw, unfiltered apple cider vinegar from Hudson Valley orchards' cider, and fruit vinegars from local berries, in oak barrels and food-grade tanks, and sells them at markets, online, to about 30 shops and grocers, and by the gallon to restaurants. In its first year it aims to sell 700 bottles of cider vinegar a month.

Part 2: the rules, acidity and pH

FDA's compliance policy guide on vinegar defines cider vinegar as the product of the alcoholic and then acetous fermentation of apple juice, and says each kind of vinegar it lists should contain 4 grams of acetic acid per 100 mL; vinegar diluted with water has to say so on its label, with its acid strength, which should never be less than 4 percent (FDA CPG Sec. 525.825). A food with a natural pH of 4.6 or below is an acid food (21 CFR 114.3); the acidified foods rules that pickles fall under are for low-acid foods with acid added. Fruit, herbs or garlic added to vinegar change the product, so test the pH of each infused vinegar, and ask a process authority before selling anything with low-acid ingredients in it. Your state may license the kitchen or fermentation room too. This is general information, not legal advice. How pH is measured is in pH testing for acidified foods.

Part 3: what a bottle costs

Local cider at about $5 a gallon gives a little less vinegar after months of fermenting, so a finished gallon of vinegar costs about $5.50, and a 16-ounce bottle holds about 70 cents of it.

The bottle costs more than the vinegar in it. How a batch's yield changes the cost of each bottle is in batch yield formula.

Part 4: customers and prices

In a month at full speed the direct bottles bring $3,213 of the $7,354 of contribution, the shops $2,004, the fruit vinegars $1,313 and the gallon jugs $824. A full month bottles about 125 gallons, so with two to three months in the tanks, about 300 to 400 gallons are always fermenting. What shops expect on a minimum order is in minimum order quantity.

Part 5: the first year, month by month

Fixed costs are $1,295 every month: fermentation room rent ($800), pH and acidity tests averaged ($40), insurance ($80), the website ($40), market fees ($150), ads ($150), and software and card fees ($35). Nothing sells for the first two months while the first batches turn:

The year's sales are $66,944 and the profit $31,523, with the bottling paid at $18 an hour. The first two months lose $2,590 with nothing to sell, which is why the plan keeps $6,000 of working cash.

Part 6: the startup budget

The $9,250 spent before working cash is earned back in month 8, when the cash reaches $9,495.

Get the template

Download the vinegar business plan workbook. Four sheets: your bottles and jugs with price, variable cost and a month at full speed; the first year, month by month, with sales, profit and cash, starting with two months of nothing to sell; your fixed costs; and your startup budget with working cash. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.

Where this stops working

A dozen barrels and tanks at different ages, each started on a different day from a different orchard's cider, each tested for acidity until it's ready, bottled a few hundred at a time, and 30 shops reordering. A notebook can't say which barrel a shop's bottles came from, which batches are ready to bottle next month, or whether there's enough in the tanks for December.

How TaroStack does it

TaroStack gives every batch a lot with its tests, and shows what's in the tanks and what's bottled.

Each barrel a batch. Starting a barrel is a batch that takes the cider off stock and gives the vinegar its own lot, recorded automatically, and a batch record form carries your own fields, such as the acidity and pH at each test, with their limits and a sign-off.

Bottling from a lot. A bottle of cider vinegar is a recipe of a pint of vinegar, a bottle, a cap and a label, so each bottling takes them off stock and records the barrel's lot it used. "What could I make right now" says how many bottles the vinegar and glass on hand allow.

Shops and lots. Each shop's order is a sales order, with one picking list for the day's deliveries, the earliest dates first, and the lots each shop got are recorded as it ships.

Recipes, batches, batch records and lots are on every plan, from $49 a month. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.

Questions people also ask

Is a vinegar business profitable?

It can be, once the first batches are ready. In the example, a vinegar maker ends the first year about $31,500 ahead on $66,900 of sales, after two months with nothing to sell.

How long does it take to make apple cider vinegar?

It depends on the method, the temperature and the cider; the example plans on two months or more from cider to finished vinegar.

How strong does vinegar have to be?

FDA's policy guide on vinegar says each kind it lists should contain 4 grams of acetic acid per 100 mL, and diluted vinegar should never be less than 4 percent acid strength.

How much does it cost to start a vinegar business?

In the example, $15,250, with the tanks and barrels, the first 400 gallons of cider and $6,000 of working cash the biggest parts.