Amazon.com, the largest global online retailer, plans to start selling United States-produced wine on its Website within America by early October, wine industry insiders said yesterday.
Napa Valley Vintners, a nonprofit group representing 315 vintners in the famous California wine-producing region, has already begun to set up workshops for wineries interested in selling through the retail giant, said Terry Hall, communications director for the group.
"They have been working for a while on this wine project. Now they are signing up the wineries," Hall told Reuters. "They're fast-tracking it right now."
Seattle-based Amazon was looking to sell wine in approximately 26 states and wine sold on its site would come from all regions of the country, Hall said.
Annual wine consumption in the US has grown for the last 14 years as wine has gradually shed its image as an exclusive beverage for the well-heeled.
Enthusiasts were starting to come from all parts of the country and younger Americans were turning to wine-drinking as an alternative to beer.
Total US wine sales were between US$30 billion and US$32 billion in 2007, according to Barbara Insel, president of Stonebridge Research Group, a research firm for the wine industry.
Some US$2.8 billion was sold through retail formats like wine clubs and tasting rooms, with only 7 percent of that coming from E-commerce, partly due to the expense of shipping wine and confusing states rules on wine shipments, Insel said.
Legal delivery
To avoid the confusing legal issues over the interstate sale of wine that vary from state to state, Amazon would work with New Vine Logistics, a Napa, California-based company dealing in wine fulfillment that could deliver to up to 45 states.
"Amazon is outsourcing to New Vine the logistics of its wine direct business to make sure it's being done properly and legally," Insel said.
Confusion over online wine sales have continued despite a 2005 US Supreme Court decision that ruled states could not discriminate against out-of-state wineries. A group called "Free the Grapes" has been working to streamline legislation and open new states to direct-to-consumer wine shipping.
Amazon, which sells everything from vacuum cleaners and cars to electronics and bulk foods on its site, continues to expand into new categories, vowing to become a one-stop shop for consumers.
Hall said wine purchases on Amazon would even qualify for its discount shipping program, Amazon Prime, in which goods were shipped free for a yearly fee of US$79.
Industry insiders said Amazon's entry into the wine market would be a good counterpoint to the shrinking pool of distributors amid consolidation in their industry.
