Tag Archives: direct shipping

Winebits 404: Restaurant wine, distributors, direct shipping


restaurant wine One person’s inexpensive: One more example of how restaurants are out of touch with their customers when it comes to restaurant wine prices. This new Dallas restaurant is boasting about its reasonably-priced list, because, said a restaurant official, “We have a low mark up on our wines, so we’re priced fantastic.” That would be a wine list with most wines supposedly costing less than $100 (no website for the restaurant yet, so I couldn’t check). What would the official have said if there had been really expensive wines on the list? Is it any wonder, unless there’s a special reason to go, that the Wine Curmudgeon has all but abandoned Dallas’ restaurants? Besides, it’s more fun eating at home.

Bigger and bigger: It’s not just wine companies that are getting bigger, but distributors as well. Wine Industry Insight reports that the 10 biggest distributors in the country control more than two-thirds of the wholesale business, which makes the group more or less as dominant as Big Wine. Why does that matter to consumers? Because, thanks to three-tier, every wine sold to a retailer or a restaurant in the U.S. has to pass through a distributor, which tacks on as much as 25 percent to the cost of the bottle for their effort. Fewer and bigger distributors means less competition, which means that percentage won’t get any smaller any time soon.

Best practices: Want to know how to help your wine survive shipment, whether it comes directly from the winery or from an online or local retailer? This list, from Entrepreneur magazine, hits the highlights nicely, emphasizing how little wine likes heat, vibrations, and being left on a delivery truck all day. One overlooked point: Give the wine, particularly the pricier bottles, a chance to recover from the trip. The bottles need to rest after being bumped across the country, and letting them sit in a cool, dark room for a week or so isn’t a bad idea.


Winebits 397: Label fraud, direct shipping, social media


label fraudHandmade wins one: A federal judge has ruled that Maker’s Mark can call its bourbon handmade, even though it isn’t, because a reasonable consumer would know it isn’t. The Wine Curmudgeon, having reported the opposite result in a similar label fraud case, marvels at the U.S. legal system. If this judge thinks it’s OK to call something handmade when it isn’t, invoking the concept of reasonableness, then why did another federal judge rule that a reasonable consumer would confuse $7 Spanish sparkling wine Cristalino with $200 Champagne Cristal? No wonder my mother wanted me to be a lawyer. It sounds much more exciting than wine writing.

The cost of delivery: Want to know why direct shipping is still such a tiny part of overall U.S. wine sales? This, from the Shipping Compliant consultancy, addresses the myriad laws and three-tier confusion that hamper direct sales, but also puts everything in perspective with one fact: “When a customer buys wine online, about 20 percent of every dollar they’re spending goes towards shipping. … In a world with services like Amazon Prime, customers hate spending money on shipping. …” Which means, even if three-tier disappeared tomorrow, direct shipping would still likely remain a tiny part of overall U.S. wine sales.

Kill all the wine writers? Because, apparently, we don’t need them. A study says U.S. adults 21 and older rely more on peer recommendations and social media than they do on traditional advertising when buying alcohol. Some of you may argue that wine writing isn’t advertising, but I’d point out you haven’t been paying attention. The report was conducted by a company that makes a social media platform and which queried its users, which is what should raise questions about the findings. Still, it claims four out of five consumers said they have bought alcohol they discovered on social media, and almost three-quarters use social media on their smartphone or mobile device when they’re buying booze. I guess I need to tweet more often.

Winebits 381: Direct shipping, consolidation, Prosecco


direct shippingLots of kinks to work out: Direct shipping, despite its successes over the past decade, is still a tiny part of the wine business, just single percentage points of the $17 billion in sales. One reason for that, of course, is three-tier, which makes it difficult for wineries to ship to consumers in different states. And three-tier has more to it than even those of us who think we know it can imagine; witness the lawyer suing Illinois wineries for not charging sales tax on shipping fees. This is perfectly legal in Illinois, where the law allows private attorneys to recover unpaid taxes on behalf of the state. Much of the coverage has been critical of the attorney, but that misses the point. Illinois law is vague on whether sales tax should be charged on shipping fees, so how how can direct shipping ever become more than a niche business if laws crucial to its success are as vague as the Illinois law? Because, given three-tier, this is certainly not the only vague, poorly written, or unclear law dealing with the subject.

Retailer buyout: Majestic Wine, one of the biggest retailers in the United Kingdom, has bought another British retailer, Naked Wine. This is bigger news than it seems, since Naked Wine has a trendy U.S. division that sells what can best be described as craft wine on-line at discounted prices to its members. It means that Majestic, facing tremendous competition from grocery stores, is trying to find wine that consumers can’t buy at grocery stores. Given the increasing importance of supermarket wine sales in the U.S., this may be a sign of things to come in this country (within the confines of three-tier) as retailers look for exclusive products to fend off grocery stores. It’s also another indication that retailers want to get bigger to fend of the Costcos, Walmarts, and Aldis of the world.

Nuts to Champagne: Prosecco has passed Champagne in sales at British grocery stores in news that is so shocking — given the British love affair with Champagne — that it should worry not only the Champagne business, but retailers around the world. If the British are buying Prosecco, the Italian bubbly that is at least half the price of Champagne, what does that means for retailers elsewhere? Has Champagne priced itself out of some markets? Do consumers prefer the softer, sweeter taste of Prosecco? Or are grocery stores playing a role in what’s going on? Even the story, from a British trade magazine, had a panicked tone.


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