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SEGMENT REPORTING
 6 Months Ended
Jun. 30, 2025
Segment Reporting [Abstract]  
SEGMENT REPORTING

6) SEGMENT REPORTING

 

The Company has identified two operating segments, Direct Sales and Distributor Sales, based upon their different distribution channels, margins and selling strategies. Direct Sales include retail sales in the tasting rooms, wine club sales, internet sales, on-site events, kitchen and catering sales and other sales made directly to the consumer without the use of an intermediary, including sales of bulk wine or grapes. Distributor Sales include all sales through a third party where prices are given at a wholesale rate.

 

The two segments reflect how the Company’s operations are evaluated by senior management and the structure of its internal financial reporting. The Company evaluates performance based on the gross profit of the respective business segments. Selling expenses that can be directly attributable to the segment, including depreciation of segment specific assets, are included, however, centralized selling expenses and general and administrative expenses are not allocated between operating segments. Therefore, net income (loss) information for the respective segments is not available. Discrete financial information related to segment assets, other than segment specific depreciation associated with selling, is not available and that information continues to be aggregated.

 

The following table outlines the sales, cost of sales, gross profit, directly attributable selling expenses, and contribution margin of the segments for the three and six month periods ended June 30, 2025 and 2024. Sales figures are net of related excise taxes.

 

   Three Months Ended June 30, 
   Direct Sales   Distributor Sales   Unallocated   Total 
   2025   2024   2025   2024   2025   2024   2025   2024 
Sales, net  $5,497,973   $5,721,172   $4,697,790   $4,611,186   $-   $-   $10,195,763   $10,332,358 
Cost of sales   1,451,868    1,608,422    2,527,277    2,252,246    -    -    3,979,145    3,860,668 
Gross profit   4,046,105    4,112,750    2,170,513    2,358,940    -    -    6,216,618    6,471,690 
Selling expenses   3,255,050    3,596,924    653,604    505,367    284,981    235,880    4,193,635    4,338,171 
Contribution margin  $791,055   $515,826   $1,516,909   $1,853,573                     
Percent of total sales   53.9%   55.4%   46.1%   44.6%                    
General and administration expenses                       1,624,819    1,596,613    1,624,819    1,596,613 
Income from operations                                $398,164   $536,906 
                                         
   Six Months Ended June 30, 
   Direct Sales   Distributor Sales   Unallocated   Total 
   2025   2024   2025   2024   2025   2024   2025   2024 
Sales, net  $9,808,448   $10,007,328   $7,928,898   $9,128,110   $-   $-   $17,737,346   $19,135,438 
Cost of sales   2,637,462    2,903,567    4,124,158    4,487,459    -    -    6,761,620    7,391,026 
Gross profit   7,170,986    7,103,761    3,804,740    4,640,651    -    -    10,975,726    11,744,412 
Selling expenses   6,341,306    6,860,305    1,293,639    1,009,792    526,400    495,856    8,161,345    8,365,953 
Contribution margin  $829,680   $243,456   $2,511,101   $3,630,859                     
Percent of total sales   55.3%   52.3%   44.7%   47.7%                    
General and administration expenses                       3,286,195    3,444,130    3,286,195    3,444,130 
Loss from operations                                $(471,814)  $(65,671)