The Grapevine celebrates 5th anniversary

On July 1, 2013 Dan and Mary Kutruff pulled the cork on a long held dream and opened their own wine shop. Their figurative wine glasses have been swirling ever since. It’s no slight achievement for a small business to light five candles in honor of steady growth; a full 50% shutter their doors by the fifth year.

In preparation for going for the gold, Dan Kutruff spent 20 years in the airline industry then paved the way to wine proprietorship by pouring wines for a distributor and subsequently recommending and selling wines at Wegmans in Gainesville.

While it was fun and educational working for a major grocery chain, Kutruff realized he not only wanted to describe wines to prospective buyers but actually wanted to select them.

“It was not as rewarding as I thought it would be,” said Kutruff. If that sounds like an entrepreneur speaking, you’ll understand his obvious next move was to own his own wine world. “This is what I was meant to do.”

By the time the opportunity arose to buy the turnkey shop in Warrenton, his bona fides had been well-established. It made his foray into the industry easier by purchasing an existing business rather than starting from scratch.

Once he opened, he immediately began reshaping the shop to his own vision. He installed a new floor, repainted and rearranged retail space allowing for more product display. With 1,000 square feet of space to work with, it was critical for profitability to maximize the presentation area.

The shop layout “has to not only be designed right it must be ergonomically correct when selling and pouring in an area where every square foot of space is retail gold,” said Kutruff.

So does Fauquier County have a defined wine profile? Not at all said Kutruff, “Diversity is how I would describe our customers’ wine preferences. That’s what makes my job so much fun. I have a penchant for trying to cater to different palates. We don’t sell things just because. We want to make our customers happy.”

Fiscal success
From the start the Kutruffs divided responsibilities based on skill sets. Mary currently works in the finance industry but became the de facto CFO. “She is an invaluable asset. She handles all of the shops finances including payroll and quarterly taxes. Sometimes she fills in at the cash register in a pinch,” said Kutruff.

As CEO, Dan Kutruff makes all the daily executive decisions on product line selections, purchases and display setups and is the face of The Grapevine.

One investment that paid handsome dividends is a software program called LiquorPOS installed over a year ago. It was created for the beverage industry and is supported by his credit card platform company. Prior to its installation sales were tracked by cash register.

“It was very frustrating. We had some clerical errors in sales transactions and monthly and quarterly reports were a lot of work to produce,” said Kutruff. “Mary had to go through of the register tapes. Now with a press of button all the required daily, monthly and quarterly reports are produced automatically.”

It’s also enabled the Kutruffs to get a grip on their tax burdens and plan accordingly. Timely payment of taxes is critical. The first year they operated at a loss but the second year saw “outstanding, stellar” revenue growth.

“Then it came time to pay the taxes and our reaction was ‘we owe what?’ ” said Kutruff. “It was a big sticker shock as to how much taxes we actually had to pay. As a small business you must definitely get a grip on your taxes.”

“But we are now fully in the 21^st century with our POS system. All the wine, beer, cigars and other products are barcoded and sales, inventory, profit margins and tax reports are readily available. We are happy with it.”

A unique aspect of the liquor business is the cash-on-delivery system. For example, when a vendor delivers two cases of wine or beer, Kutruff must write a check on the spot. And if the product doesn’t move, there’s no returning it.

The model forces him to closely monitor what sells and what doesn’t and to keep inventories in balance with cash outlays. “A big part of the learning process is managing your cash flow,” Kutruff said.

Did all the infrastructure and financial changes and real time experience make a difference? “For me an important part of our success is that not one dollar from our personal finances went into the shop. And we’ve been profitable the last four years. That’s key to the startup of as successful company.”

Marketing
In explaining how he attracts new customers Kutruff said, “The biggest thing is word of mouth.” When he left Wegmans word spread that he had opened the shop in Warrenton. Many of those customers lived in town and let friends know his expertise was now just minutes away. This loyal base and new adherents drove sales up.

He acknowledges, however, the need to tap into a new demographic. Currently his base is typically 40 years old and up. He’s investigating expanding his social media presence beyond Facebook. Twitter, Snapchat and other younger oriented media venues have the potential to further grow business. Online presence is now the tsunami of retailing. Failure to actively engage it would be irresponsible and costly.

Interestingly, his 100 square foot walk-in humidor does not generate a significant volume of collateral wine and beer sales. His cigar demographics are scatted across a wide age group and acts as an adjunct to sales on slow days.

“Monday and Tuesdays are generally slow but we have a lot of cigar smoking golfers helping supplement shop revenue on those days,” Kutruff said. “That humidor is gold.”

Future
The entrepreneur currently has no plans to open a second location. The shopping center where he’s located is on the market and he will wait and see how, or if, any possible changes shake out.

He underscores the obvious secret of running a small business is hard work. “As the face of the business I need to be here. A lot of customers get upset when I’m not. My employees are great but people come to see me and get my recommendations. That’s not to toot my own horn. But if I wasn’t here, this place wouldn’t work as well,” Kutruff said.

But rest easy Warrenton, Dan and Mary’s Kutruff’s abiding goal is to create an everyday wine shop where social libation fans can stop by for a companion to their evening meal or weekend party.                                                                                             

The Grapevine
389 W. Shirley Ave.
Warrenton, VA 20186
540.349.4443

Lets’ do the numbers:

600 wines ranging from $7.99 to $110.
Emphasis on quality bottlings in the $10 to $15 range
140 cigar selections from the world’s top producers
90 different craft beers, ciders and meads
Free wine tastings on Saturdays

Hours:
Monday – Thursday 11 a.m. – 7 p.m.
Friday – Saturday 10 a.m. – 7 p.m.
Closed Sundays

 

Published in the Jun 20, 2018 edition of the Fauquier Times.