The future of wine sales
If you are a travel agent I don't have to tell you what the Internet has meant to your profession. Brick and mortar stores of all shapes and sizes have seen their business models change, often unwillingly. All while the consumer continues to benefit from the never ending variety of options to "buy on-line."
Many of us have all been dragged into the 21st century kicking and screaming, but none more than the wine industry. Since the repeal of prohibition there has been a strict three tier system for selling wine. The producer sells to the distributor, and the distributor to the retail/restaurant outlet, and finally the wine gets to the consumer.
Last year's Supreme Court ruling brought national attention to the concept of "Direct To Consumer" shipment of wine. What was less talked about on the cable news shows was the possibility of "Direct To Trade" (retailer/restaurant) sales.
What a difference it would make, especially for restaurants, if small wineries could sell directly. Distributors tend to warehouse huge amounts of wine, and the smaller the winery, the less attention it is too often given. It is easy for a few cases to get lost behinds the mountains of inventory that needs to be moved.
Inertia Beverage Group is going to change all that. By leveraging the Internet as a tool to keep track of all the pesky taxes as well as the distributor's cut, IBG has made it possible for a restaurant to order just the wine they want.
At least that is the promise, and the reality is not far behind. Currently only California and New York enjoy this privilege, but according to IBG's CEO Paul Mabray "We are launching FL, CT, TX, WA, and AZ in the next two months and 20 states after that."
Paul also tells us that they already represent over 300 brands, with 100 more on the way.
What makes all this possible is a paradigm shift that many have been slow to embrace, but which Paul Mabray and IBG see clearly.
When asked about the particulars of the software that allows DTT sales to happen, Paul replied "We are an open source, proprietary system of on-demand software (an application service provider) that can be used by any computer with a web browser and an internet connection."
What this means to those less computer geeky than I, is that using their services is as easy as surfing the web.
Allowing consumers and retailers/restaurants to buy directly from wineries has long been one of my favorites rants. I have been championing this for many of the same reasons as I push consumers to tour wineries and buy directly.
It lets the wineries know what people's tastes really are, not just what a distributor thinks they can sell. It gives the winery a little more money for their wines, and in some cases, may be the only way a winery has to sell their goods. It also gives consumers a chance to explore beyond the taste of their local wine buyers.
On the flip side, I really like what this means for restaurants. Fewer restaurants will be able to get away with a wine program which in reality is nothing more than a dumping ground for their local distributor.
The ability to source wines from far and wide will create greater demand for lesser known wines, and the restaurants will have to step up and increase their participation and knowledge in wine.
The consumer wins not only from having a greater selection of wines to chose from, but the fruit of healthy competition will yield better restaurants, retailers, and even wines.
The mechanism is just coming into place. It required looking at the industry in a new way to get to this point, and now the onus is on restaurants and retailers to do the same. They need to look beyond their favorite distributors with their weekly visits. They need to form relationships with their favorite wineries, and to expand their horizons.
It will take time, but the Inertia Beverage Group at www.rethinkwinetrade.com have sown seeds of outstanding potential.
Many of us have all been dragged into the 21st century kicking and screaming, but none more than the wine industry. Since the repeal of prohibition there has been a strict three tier system for selling wine. The producer sells to the distributor, and the distributor to the retail/restaurant outlet, and finally the wine gets to the consumer.
Last year's Supreme Court ruling brought national attention to the concept of "Direct To Consumer" shipment of wine. What was less talked about on the cable news shows was the possibility of "Direct To Trade" (retailer/restaurant) sales.
What a difference it would make, especially for restaurants, if small wineries could sell directly. Distributors tend to warehouse huge amounts of wine, and the smaller the winery, the less attention it is too often given. It is easy for a few cases to get lost behinds the mountains of inventory that needs to be moved.
Inertia Beverage Group is going to change all that. By leveraging the Internet as a tool to keep track of all the pesky taxes as well as the distributor's cut, IBG has made it possible for a restaurant to order just the wine they want.
At least that is the promise, and the reality is not far behind. Currently only California and New York enjoy this privilege, but according to IBG's CEO Paul Mabray "We are launching FL, CT, TX, WA, and AZ in the next two months and 20 states after that."
Paul also tells us that they already represent over 300 brands, with 100 more on the way.
What makes all this possible is a paradigm shift that many have been slow to embrace, but which Paul Mabray and IBG see clearly.
When asked about the particulars of the software that allows DTT sales to happen, Paul replied "We are an open source, proprietary system of on-demand software (an application service provider) that can be used by any computer with a web browser and an internet connection."
What this means to those less computer geeky than I, is that using their services is as easy as surfing the web.
Allowing consumers and retailers/restaurants to buy directly from wineries has long been one of my favorites rants. I have been championing this for many of the same reasons as I push consumers to tour wineries and buy directly.
It lets the wineries know what people's tastes really are, not just what a distributor thinks they can sell. It gives the winery a little more money for their wines, and in some cases, may be the only way a winery has to sell their goods. It also gives consumers a chance to explore beyond the taste of their local wine buyers.
On the flip side, I really like what this means for restaurants. Fewer restaurants will be able to get away with a wine program which in reality is nothing more than a dumping ground for their local distributor.
The ability to source wines from far and wide will create greater demand for lesser known wines, and the restaurants will have to step up and increase their participation and knowledge in wine.
The consumer wins not only from having a greater selection of wines to chose from, but the fruit of healthy competition will yield better restaurants, retailers, and even wines.
The mechanism is just coming into place. It required looking at the industry in a new way to get to this point, and now the onus is on restaurants and retailers to do the same. They need to look beyond their favorite distributors with their weekly visits. They need to form relationships with their favorite wineries, and to expand their horizons.
It will take time, but the Inertia Beverage Group at www.rethinkwinetrade.com have sown seeds of outstanding potential.
posted by Wineguy at 9:36 AM
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