Small Business Credit Profiles

Uncorking the possibilities with the right business card

A sweet relationship between wine and Plums has helped this online business reach its full-bodied potential


From an apartment bathtub to a booming e-commerce business, founder Alex Andrawes’s spur-of-the-moment idea has offered sweet dividends.

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Alex Andraws

Alex Andraws

In 1999, Alex Andrawes was a student at University of Texas at Austin. He was also working at an investment firm with the intention of going into finance. That all changed the week before Christmas.

“One of the financial consultants asked me to go to Costco and buy wine gifts for his clients,” says Andrawes. “He asked me to buy some holiday cards as well. I told him why not just scrape the labels off and apply a new, personalized label? He loved the idea. I took 15 cases of wine home, scrubbed the wine labels off the bottles in my bathtub, attached the new labels and brought them to the office the next day.”

The reaction among the other advisors was so positive that they also placed orders. “In my first month of business, I produced over $18,000 in revenue alone,” says Andrawes.

Personal Wine was uncorked — operations soon moved from his apartment bathtub to a large office. The business has been expanding ever since, growing by approximately 20 percent each year. Here’s how credit cards are keeping up with the flow.

See related: Gilded elegance and a business card to match

What was the beginning of your business like — any hardships to overcome to open your doors? 

Personal Wine

The beginnings of Personal Wine were hectic and extremely difficult. We operate in a regulatory environment where the government has eyes on every facet of our business. I was once told by an enforcement officer that our license is a privilege and not a right, and that is no joking matter. It took us one full year to open our doors for business. I had to undergo an extensive background check and a checklist that has no expedited options.

Personal Wine has had one major obstacle at its inception point and several since then. I came to realize that personalization of wine had no documented business practice at the time the company was founded. I contacted a lobbyist who assisted me in creating a framework with the regulatory bodies for customization of wine labels. The process took several steps and years to build. Had I known then what I know now, I am sure I would still tackle the obstacles all over again — but I would have done it differently.

Our next greatest challenge continues to be innovation within the mass customization space. It’s easy to order a product online, but customizing that product online is difficult due to limited screen size. So, we put significant resources into our mobile customization tool every year. The challenge of keeping up with technology never ends!

See related: Brewing up success with business credit cards

Where there any surprise costs that caught you off guard? 

Yes, the cost of inventory! Wine isn’t an easy product to make. It is highly variable as an agricultural product and we all know that nature has a way of putting people in check. For example, after the last wildfire, a substantial amount of crop was destroyed either by fire or by smoke taint. This causes prices to immediately increase to forecast for the lack of supply in the future.

Additionally, many countries have laws surrounding how people grow grapes for wine production. In France, there is a popular wine we refer to as Burgundy — farmers there have been growing in adverse conditions for centuries. The laws in France stipulate that if you want to receive a Grand Cru classification to your wine — which results in a higher commanding price on the retail side — you must adhere to strict laws.

These laws prohibit buying grapes from other vineyards to supplement production. The laws also prohibit irrigation and canopies to prevent hail damage. Basically, you get what mother nature gives you. This creates a scenario for extreme price fluctuations year-over-year.

Where have credit cards fit with your business?

Credit cards have saved us at different points in time. In the alcohol business, we are prevented from paying our alcohol vendors with credit cards. As such, this puts a substantial limit on cash flow. We use credit cards to pay just about every single vendor otherwise so that we can float our payables for 30 days — sometimes longer.

It makes sense to have a business credit card that allows you to increase and decrease your borrowing capacity in a seasonal business environment.

Credit cards can be extremely beneficial for businesses — when discipline can be followed. They offer buyer protections that are unavailable to companies who pay in cash. With the rewards system, points rack up and we can accrue travel miles that help our business or offer cash back for early payments. Credit cards are a viable option for business owners — especially startups where bank debt is increasingly more difficult to obtain.

We use a couple of cards regularly in our business but lean heavily on The Plum Card® from American Express, as it offers a substantial rewards program for early payment and, more importantly, Amex offers super low interest loans on accounts receivables for business line-of-credit. If you have a credit history with your credit card, it’s amazing how far American Express will go to support your business.

As for debt, we are usually highly leveraged in key seasons. Our key seasons are September through December and March to May. We are typically debt free in January and February.

What are your future plans for the business, and why?

Our business is currently experiencing continued and systematic growth. While our total market has its limitations due to regulatory issues, the millennial generation loves wine and they love things that are non-traditional. That includes personalized wine!

We will increase our customized product offerings in new categories that include more accessories and bar wares. We love having the freedom to customize products that do not require as much regulatory oversight.

We want to customize products that attract new customers but still give people an opportunity to order personalized wine.

What have you learned about borrowing money, and can you give any advice to other entrepreneurs?

You should always have options. Never wait to borrow money when you need it the most. Always work on increasing your borrowing capacity, even when you need it the least. Surround yourself with brilliant advisors and employees. It should be your goal to be the “dumbest” guy in the room — it will help you grow your business. Additionally, be aware of your competitors, but don’t spend too much time copying them or you’ll always be one step behind.

Lastly, I would emphasize that you should develop a support group of people to help you navigate through the tough times. If you find yourself in a pickle, just be calm. Don’t execute knee jerk reactions as they typically cost you a ton of money and often enough, they don’t fix the real problem. Throwing money at things doesn’t always work — you are going to fail. Your goal is not to make the same mistake twice!

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