Whether you’re a start-up wine brand without your own facility or an established producer looking to scale, partnering with a co-packer or custom crush producer can be a smart way to bring your product to market. But without a well-drafted contract, you may be leaving your business exposed to costly disputes, compliance headaches, and even product recalls.
Why a Contract is Essential
A co-packer or custom crush arrangement isn’t just a handshake deal about making wine—it’s a complex relationship involving production timelines, quality control, regulatory compliance, intellectual property rights, and payment terms. A strong written agreement protects both sides and creates a clear framework for how the relationship will work from grape to bottle.
Key reasons you need a contract:
- Clarifies Responsibilities
- Who is responsible for sourcing grapes, providing barrels, or supplying bottles?
- Who manages compliance with the Alcohol and Tobacco Tax and Trade Bureau (“TTB”) and state alcohol agencies?
- Sets Quality Standards
- Defines target alcohol content, flavor profile, and style.
- Establishes quality control procedures and remedies if the product doesn’t meet agreed-upon standards.
- Protects Your Intellectual Property
- Confirms brand ownership and prevents unauthorized use of your labels, trademarks, and formulas.
- Addresses whether the producer can make a similar wine for another client.
- Defines Payment & Delivery Terms
- Clear pricing, payment schedules, and what happens if costs change.
- Delivery dates and consequences for delays.
- Provides a Roadmap for Dispute Resolution
- Mediation, arbitration, or court jurisdiction provisions in case disagreements arise.
- Mediation, arbitration, or court jurisdiction provisions in case disagreements arise.
- Addresses Termination & Exit Strategy
- How either party can end the agreement and what happens to unfinished wine, stored inventory, or packaging materials.
Special Compliance Considerations
In the alcohol industry, contracts don’t just protect you from business disputes—they help keep you compliant with the law. Depending on your licensing structure, your agreement should address:
- Who holds the necessary licenses for producing, storing, and shipping the wine.
- Label approvals and recordkeeping obligations.
- Bond coverage for wine in production or storage.
Without clear terms, you could be on the hook for regulatory violations committed by your production partner.
What Happens Without a Contract?
Without a written agreement, misunderstandings can quickly escalate. Common problems include:
- Disputes over wine quality or style.
- Delays in bottling and delivery.
- Confusion over who owns the inventory or packaging.
- Surprise charges for storage, supplies, or extra labor.
In the worst-case scenario, a dispute can result in production being halted, product being destroyed, or legal action to recover damages.
Bottom Line
A co-packer or custom crush producer can be a valuable partner in growing your wine brand—but only if the relationship is built on a solid legal foundation. A carefully drafted agreement ensures both sides understand their rights and obligations, helps prevent disputes, and keeps your brand compliant with complex alcohol laws.
Before you start production, work with an attorney experienced in wine law to draft or review your contract. The upfront investment in a clear, tailored agreement can save you from costly problems later.
How Lindsey Zahn P.C. Can Help
At Lindsey Zahn P.C., we focus exclusively on alcohol beverage law and understand the unique challenges wine brand owners and co-packers face. We have extensive experience drafting and reviewing wine co-packing contracts and custom crush production agreements, and we can help you:
- Draft and negotiate agreements tailored to your specific business model.
- Review existing contracts to identify risks and strengthen protections.
- Integrate TTB and state compliance requirements directly into contract terms.
- Structure relationships that support your long-term operational and financial objectives.
Whether you’re just starting out or looking to improve an existing agreement, we can help you protect your brand and avoid costly disputes. Contact us to schedule an initial consultation and build a strong legal foundation for your business.
📩 Email us at info@zahnlawpc.com
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