Smart Farming Starts with Smart Financial Planning: Understanding the NVG Financial Farming Model
Vineyard owners and managers know that financial planning in the wine industry is anything but simple. Rising labor costs, fluctuating grape prices, and unpredictable yields create unique financial challenges. To address these complexities, Brotemarkle, Davis, & Co. developed the NVG Financial Farming Model, with training presented by Craig Underhill and offered through Napa Valley Grapegrowers. This free tool provides a structured approach to vineyard financial management, allowing growers to make informed decisions, anticipate outcomes, and refine their strategies.
Why Was This Model Developed?
Vineyard operations require careful financial oversight, but traditional accounting systems often fail to capture the nuances of agricultural cycles and cost structures. The NVG Financial Farming Model was designed to fill this gap, ensuring growers and vineyard managers have a tool tailored to their unique business needs. It provides clear insights into profitability, cash flow, and potential financial risks, empowering users to adjust their practices proactively rather than reactively.
What Does the Model Consider?
The NVG Financial Farming Model incorporates key financial and operational metrics to give vineyard owners a detailed picture of their business. Some of the main components include:
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Revenue Projections – Based on anticipated grape yields and market pricing, allowing for strategic sales planning.
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Cost Analysis – Evaluates expenses per acre and per ton, distinguishing between fixed and variable costs.
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Labor and Management Structures – Provides two tailored versions: one for vineyard owners using farm labor contractors and another for those employing vineyard staff directly.
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Cash Flow Forecasting – Identifies seasonal financial trends and cash needs to ensure smooth operations.
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Scenario Planning – Enables users to test different business strategies, such as adjusting labor costs, investing in new equipment, or responding to market fluctuations.
How Can This Model Benefit Vineyard Owners?
By using this tool, vineyard owners and managers can:
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Optimize Profitability – Understand which aspects of their business drive revenue and where cost efficiencies can be implemented.
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Improve Decision-Making – Utilize clear financial data to support business strategies and investment choices.
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Plan for the Future – Anticipate potential financial challenges and adjust operations accordingly.
- Engage Teams – Empower teams to help identify ways of optimizing farming practices.
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Enhance Communication – Provide clear financial insights to stakeholders, investors, and winery partners.
How to Access the NVG Financial Farming Model
The NVG Financial Farming Model is available through Napa Valley Grapegrowers and is designed for both independent vineyard owners and vineyard management companies. Whether you are planning for an upcoming harvest, analyzing labor costs, or refining your long-term business strategy, this model provides the financial clarity needed to navigate the evolving wine industry.