Wine sales are increasing year after year. In 2017, this market generated $62.2 billion in the United States alone, and that number only includes retail sales. If you own a small winery, you could turn it into a profitable business with minimum investment. All you need is a website to sell wine online and connect with potential customers. Another option is to start an online wine business on Amazon or another shopping platform, which can further reduce your expenses.
Choose a Business Model
The first step is to choose a business model. Do you prefer to set up an online wine store and sell directly to customers? In this case, you'll be responsible for creating the website, promoting your goods and handling customers' inquiries. Also, it's important to find a shipping company that can deliver wine to your clients at an affordable rate.
If you're not tech-savvy or you wish to keep things simple, partner up with an online auction house. They will advertise your products and find customers for your wine e-commerce business in exchange for a commission. Your only job will be to ship the wines and collect payment. The drawback is that you'll pay a percentage of your earnings to the auction house.
You can also sell your products through a wine retailer. They will handle the sales process and pay you for each sale. Some retailers will also arrange private auctions for your wine.
If you choose this option, it's not necessary to have an online wine store. However, setting up a website to display your wine collection can help you establish your brand and reputation. Eventually, you can sell both to customers and wine retailers.
Shopping platforms like Amazon and eBay make it easier to start an online wine business. Sign up for a merchant account, set up an online store and write compelling descriptions for your products.
Beware that Amazon doesn't handle wine fulfillment. You will be responsible for the fulfillment of consumer-direct shipments. To streamline this process, consider working with a specialized company, such as Wine Logistics, Vinfillment or WineShipping.com. They will not only ship your wine but also store it in temperature-controlled warehouses.
Requirements for Selling Alcohol Online
No matter what business model you choose, it's necessary to register your company and meet the legal requirements for selling alcohol online. Choose a business structure, register for taxes and then apply for licenses and permits.
For example, alcohol wholesalers are legally required to obtain a Basic Permit from the Alcohol and Tobacco Tax and Trade Bureau (TTB). You may contact the TTB by email at firstname.lastname@example.org or call 202-453-2260 to request more information.
In addition to this permit, it's required to obtain a retailer’s license and a winery license from your state. Plus, you must register with the TTB before you start selling alcohol online. Furthermore, merchants must apply for a shipper's license for each state to which they are planning to deliver their products. Liquor license fees range from $1,000 to $13,900 depending on where you live.
If you're going to ship wine to another state, you will need a Direct-to-Consumer (DTC) license. Beware that certain states, such as Utah, Alabama and Delaware, may not receive DTC wine shipments.
Learn About Wine
Before you start to sell wine online, familiarize yourself with the market. Take a look at the wine e-commerce stores that do well and then try to come up with something better. Determine which types of wine you want to stock and what you're going to charge.
As far as marketing is concerned, you cannot suggest that wine supports health and well-being. Also, you may not promote alcohol consumption as being amusing or vital to success. It's not allowed to use alcoholic beverages to promote illegal activities.
- Statista: Total Retail Value of Wine Sales in the United States from 2000 to 2017
- TTB.gov: Wholesaler/Importer/Exporter
- Vinepair: Everything You Need to Know About Shipping Wines Across State Lines in 2017
- BigCommerce: Wine Ecommerce in 2018: How to Successfully Sell Wine Online (Includes Shipping Regulations by State)