Uncorked Wine Co. - Manhattan, NY
When Paul Common lost his job as an equity researcher for Merrill Lynch, he capitalized on his decade-long passion. An amateur wine collector, Common opened a retail wine shop.
He read everything he could about the industry, then enlisted the help of Pace University's Small Business Development Center to fine-tune his business plan. He drained his bank accounts of $185,000 to open Uncorked Wine Co., the retail wine shop he envisioned. But his investment covered only half of what he needed to gut, rehab and stock the tiny storefront he planned to lease in New York City's Greenwich Village.
Staff at Pace's SBDC referred Common to NYBDC, which approved a $185,000 loan for Uncorked Wine Co. for furniture, fixtures, equipment, inventory and working capital.
"NYBDC was the only lender that came through," Common said.
Steve Willard, NYBDC senior vice president, said he was impressed by Common's extensive knowledge of wines, solid business plan and the shop’s unique model. Uncorked employs technology by which customers can taste wines for free, removing the uncertainty from their purchasing decisions. It’s a critical selling tool because the average cost of bottle of wine at Uncorked is $25, compared with a national average of $8 per bottle, Common said.
The wine shop's $50,000 technology allows for up to 40 opened bottles of wine at a time. Argon gas in 10 separate wine stations depressurize the bottles after they are uncorked. This gives the wine two months' longevity, rather than the typical life span of two days.
"This 'try before you buy' option turned out to be quite a hit with the store's growing clientele, and the equipment serves to both control the sample sizes and reduce waste typically associated with opened, unfinished bottles for tastings," Willard said.
Common said the technology addresses the biggest challenge he faced as a wine lover: his frustration at receiving bad advice - or no advice at all - from wine sellers.
"You can test-drive a car, try on pair of jeans or even taste a piece of cheese before you buy. Why not test-drive your wine?" he said.
It also provides an edge over the half-dozen other wine shops in the neighborhood. Revenue at Uncorked Wine Co. increased 25 percent annually since the shop opened in 2012. Sales in 2014 are expected to top $650,000. Common, the shop's only full-time employee, said he needs to reach $1 million in sales a year to earn a living and support his family.
Nationwide, one-half of all wine sales occur in the last two months of the year, when people are buying for gifts or home consumption, said Common, so the key is bolstering interest during those off-times. Common is working to boost participation in the store's Wine of the Month Club, currently five percent of all revenue. He counts on foot traffic for the bulk of sales.
"No question this would not have been possible without NYBDC's loan. The start-up costs are too high," Common said. "And I did not, under any circumstances, want a partner. The ground is littered with business relationships gone bad."