Can a Brewery Add Sparkling Wine to Its Portfolio? A Practical Guide

The craft beverage industry has never been more competitive, and brewery owners across the country are asking the same question: how do we grow without simply making more beer? For many, the answer is not another IPA or seasonal lager. It is expanding the category entirely.

Sparkling wine has emerged as one of the most compelling portfolio additions a brewery can make. It is high-margin, broadly appealing, and solves a persistent tasting room problem: the customer who walks in with a group of beer drinkers but does not drink beer themselves. The barriers that once made sparkling wine production seem out of reach for a brewery are more manageable than most operators realize.

This guide covers what a brewery owner or head brewer needs to know before making that decision: the regulatory landscape, the production options, the economics, and the practical steps to get a sparkling wine program off the ground without derailing your core operation.

Why Breweries Are Exploring Sparkling Wine

The craft beer market has matured significantly over the past decade. Taproom traffic is harder to grow, competition for shelf space is fierce, and the novelty of craft beer alone no longer drives foot traffic the way it once did. At the same time, consumer beverage preferences have become more fluid. Younger drinkers move comfortably between beer, wine, cider, and spirits depending on occasion, mood, and who they are with.

This shift creates both a problem and an opportunity for breweries. A taproom built exclusively around beer leaves money on the table every time a non-beer drinker shows up with a group. A well-chosen cross-category addition can increase average transaction value, broaden your customer base, and give existing customers a reason to visit more often.

Sparkling wine checks every one of those boxes:

• Perceived as premium and celebratory
• Visually distinctive on a tap list or menu
• Appeals to demographics that brewery taprooms have historically underserved
• Pairs naturally with the social, occasion-driven environment a taproom creates
• Generates strong margin relative to production cost

For most taproom-focused operations, the question is not whether sparkling wine could work. It is whether the operational and regulatory pathway is manageable. It is, but it requires planning.

The Regulatory Reality

This is where most brewery owners stop before they start. Wine and beer occupy different regulatory categories at both the federal and state level, which means a brewery cannot simply start producing or selling wine under its existing license. The good news is that the dual-licensing path is well-established and navigable.

Federal Licensing: Brewer’s Notice vs. Winery Permit

At the federal level, beer and wine production are governed by two separate permits administered by the Alcohol and Tobacco Tax and Trade Bureau (TTB).

License Type	Covers	Issued By
Brewer’s Notice	Beer and malt beverage production	TTB
Basic Permit + Winery Bond	Wine production on bonded premises	TTB

These are not interchangeable. If your brewery intends to produce sparkling wine on-site, a winery permit is required in addition to your existing brewery authorization. The TTB application process involves background checks, facility documentation, and a review period that typically runs several weeks to a few months. Planning ahead is essential.

If you are contracting sparkling wine production to an outside facility rather than making it yourself, the permitting picture changes considerably. More on that below.

State Licensing Considerations

Federal permitting is only part of the picture. Every state has its own licensing structure for alcohol production and retail sales, and the rules governing what a licensed brewery can produce and sell vary considerably.

In Michigan, the Michigan Liquor Control Commission (MLCC) oversees licensing for all beverage alcohol categories. Michigan does allow for dual licensing, meaning a business can hold both brewery and winery licenses, but the specific requirements, fees, and operational constraints depend on your existing license type and how your facility is structured.

Any brewery seriously exploring sparkling wine production or sales should consult with a licensing attorney familiar with their state’s alcohol beverage control statutes before proceeding. The regulatory landscape is state-specific, and general guidance is not a substitute for jurisdiction-specific legal advice.

Tied House Rules

One additional regulatory consideration that catches producers off guard is tied house laws, which exist at both the federal and state level. These laws restrict relationships between producers, distributors, and retailers in ways that can affect cross-category production and sales. Specifically, they can influence:

• Whether a licensed brewery can sell wine produced at a separate facility
• Whether a business can hold retail licenses alongside production licenses
• How branded merchandise or promotional activity is handled across categories

Your licensing attorney is the right resource for understanding how these rules apply to your specific situation.

Your Production Options

Once you understand the regulatory framework, the next decision is how you actually want to produce and source the sparkling wine. There are three meaningful paths, and they differ significantly in cost, complexity, and control.

Option 1: Produce Wine Yourself

The most involved path is building in-house wine production capability. This means obtaining a winery permit, acquiring winemaking equipment, sourcing grapes or base wine, and developing or hiring winemaking expertise to manage fermentation, stabilization, and packaging.

For sparkling wine specifically, the equipment requirements go further than still wine production. Charmat method sparkling wine requires pressurized autoclave tanks for secondary fermentation and an isobaric filler for bottling under pressure. This equipment is not inexpensive, and it sits largely idle outside of sparkling production windows.

This path makes sense for breweries with a genuine long-term commitment to wine production at meaningful volume, existing winemaking expertise on staff, and facility space that can accommodate wine production equipment. For most breweries exploring a first sparkling program, it is the highest-risk option.

Option 2: Purchase Finished Bulk Wine for Your Label

The second option is to purchase finished bulk sparkling wine from a producer and bottle it under your own label. This allows you to bring a sparkling wine to market without any production infrastructure.

The trade-off is control. You are working with wine already made to someone else’s specification, which limits your ability to differentiate on taste profile or production story. It can be a fast and low-risk way to test whether your customers respond to a sparkling wine offering before committing to a deeper production relationship.

Option 3: Contract Production

For most brewery operators, contract production is the most practical entry point. Under this model, you work with a contract production partner to specify the style, grape variety or blend, sweetness level, and other parameters. The production partner handles winemaking, fermentation, stabilization, and bottling. The finished product carries your label.

Here is how the three options compare:

	Produce In-House	Purchase Bulk	Contract Production
Capital investment	High	Low	Low
Control over product	High	Low	Medium-High
Winemaking expertise needed	Yes	No	No
Speed to market	Slow	Fast	Medium
Risk level	High	Low-Medium	Low
Best for	High-volume, long-term programs	Quick market test	First sparkling program

Contract production resolves the three biggest barriers simultaneously: it eliminates the equipment investment, provides winemaking expertise you do not have in-house, and allows you to start at a scale appropriate for testing the market rather than betting your capital budget on an unproven program.

Why Charmat Is the Right Method for a Brewery Entry Point

Not all sparkling wine is made the same way, and the production method matters for both practical and positioning reasons.

The Two Main Methods

Traditional Method (Methode Champenoise): Second fermentation occurs inside each individual bottle, followed by extended lees aging, riddling, and disgorgement. Produces complex, toasty, autolytic character associated with Champagne. Takes considerably longer and requires more labor-intensive handling.

Charmat Method (Tank Method): Secondary fermentation occurs in a large pressurized tank. The wine is then filtered and bottled under pressure using an isobaric filler. Produces wines that are fresher, more fruit-forward, and more aromatic than traditional method wines. Prosecco is the most recognized Charmat product globally.

Why Charmat Works for Breweries

For a brewery entering sparkling wine through a contract partner, Charmat offers a clear set of advantages:

• Faster production timeline measured in weeks rather than months or years, meaning less working capital tied up before you have product to sell
• Style flexibility accommodating a range of expressions from classic Brut to Rosé to fruit-forward sparkling
• Approachable flavor profile that performs well in tasting room environments where customers encounter the product for the first time
• Infrastructure exists at your production partner’s facility, not yours

The style profile Charmat produces is also a natural fit for a brewery’s existing customer base. Fresh, fruit-forward, and approachable is a much easier sell to a craft beer drinker exploring wine for the first time than the more austere, complex character of traditional method sparkling wine.

Learn more about Fenn Valley’s Custom Sparkling Wine production capabilities, including both Charmat method and forced carbonation options.

Brand and Tasting Room Considerations

Adding sparkling wine to a brewery portfolio raises legitimate questions about brand identity. Breweries spend years building a brand around beer, and the concern that adding wine could dilute or confuse that identity is valid.

Brand Integration Approaches

Integrate under your existing brand when your brand concept is broad enough to carry it credibly. If your brand could credibly extend to a premium sparkling wine without the positioning feeling strained, this is the simplest path.

Create a sub-brand that positions the sparkling wine program distinctly while maintaining a visible connection to the parent brewery. A common approach in the beverage industry that lets you leverage your existing reputation without constraining the wine to your beer brand’s specific aesthetic.

Launch a separate label to create a clean separation between the beer and wine identities. Requires more marketing investment upfront but works well if your beer brand is highly specific in its positioning or if you anticipate the wine program growing to meaningful scale.

For most brewery operators launching a first sparkling program, the sub-brand approach offers the best balance of leveraging your existing reputation while giving the wine its own creative space.

Tasting Room Logistics

• Verify with your licensing attorney whether serving wine requires additional endorsements for your license type and state
• Train staff on sparkling wine service: proper glassware, serving temperature, and how to describe the product
• Consider how the wine will appear on your menu or tap list and whether it warrants its own section or callout

Distribution Implications

Beer and wine move through the three-tier distribution system through separate channels in most states. Your existing beer distributor almost certainly does not hold wine distribution rights, which means sparkling wine cannot simply be added to your beer delivery.

For a first sparkling product at modest volume, this is less of a barrier than it sounds. The tasting room and direct-to-consumer channel is the right starting point regardless, for several reasons:

• Lets you build consumer familiarity before committing to wholesale distribution
• Avoids the margin compression and minimum volume requirements of wholesale placement
• Generates real demand data to bring to a wine distributor conversation later
• Keeps regulatory complexity lower while you establish the program

As the program grows and you evaluate wholesale placement, you will be looking for a wine distributor with appropriate geographic coverage and a book of business that aligns with your product’s price point and style. That conversation is significantly easier to have with proven consumer demand behind you.

Start With One SKU

The instinct to launch a full sparkling program with multiple styles and price points is understandable but almost always premature.

A single well-chosen SKU at a meaningful quality level is a better opening move. Here is why:

• Focuses your energy and your customers’ attention on a single product
• Contains your initial investment while you test market response
• Generates clean, interpretable demand data before you scale
• Gives your production partner a clear target to optimize

The right first SKU for most brewery operations is a dry or off-dry expression, a Brut or Extra Dry, in a style that complements your existing portfolio and appeals to the non-beer-drinking guest. A sparkling Rosé is also a strong first option for breweries with fruit-forward brand expressions, as it bridges flavor expectations between beer and wine in a format that is instantly recognizable to both audiences.

Whatever style you choose, prioritize quality over novelty. A well-made sparkling wine earns its place on your menu. A mediocre one will not benefit from the fact that it comes from a brewery your customers already love.

What to Bring to a Contract Charmat Conversation

If contract sparkling wine production is worth exploring for your brewery, the conversation with a production partner will go better if you arrive with clarity on these questions:

Volume target: Most contract production facilities have minimum batch sizes. Understanding where you fall relative to those minimums establishes early whether the relationship is practical and at what scale to plan your first run.

Style and specification: A general sense of your target sweetness level, varietal preferences, and whether you are thinking Brut, Rosé, or something more fruit-forward helps your production partner understand what you are building toward.

Grape or base wine supply: Are you intending to supply grapes, supply a base wine, or have your production partner source the base wine on your behalf? Each entry point has different implications for cost, control, and timeline.

Production timeline: When do you want product in hand? Understanding your production partner’s scheduling and the realistic timeline from initial conversation to finished, labeled product helps you plan your launch.

Label and compliance: Do you have TTB label approval in process, or will you need support? A good contract production partner can assist with COLA submission and compliance requirements.

Explore Fenn Valley’s full range of services, including bulk wine production, custom packaging solutions, and wine lab testing, to understand the full scope of support available to producers at every stage.

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