Dear Wine Lover,
And instead of finding great deals, we found this note on their homepage.
Due to sudden and dramatic changes to carrier interstate shipping guidelines, Wine Kloud's platform is no longer sustainable. The retailer's ability to ship wine over state lines is contracting at a rapid pace. Therefore, it is with a very heavy heart, filled with awesome wine purchased at an amazing discount, that we suspend our operations.
"It's happening," said Daniel Posner, owner of Grapes The Wine Company in White Plains, N.Y. and president of the National Association of Wine Retailers (NAWR). "Your favorite online store won't exist, and FedEx and UPS will get out of wine shipping business."
We immediately reached out to both shipping companies and they still are shipping wine cross-state borders at this point, but neither would comment on the possibility that the practice may be changing.
Still, Posner and many retailers are convinced that interstate shipping is going away.
Gary Fisch, owner of Gary's Wine & Marketplace in New Jersey, is just as concerned. "I'm worried that one day I'm going to walk in [my store] and find a bunch of boxes that are not going to be picked up for shipping," he said.
"As a result of lobbying efforts to protect local retailers and wholesalers, wineries approving of bans on retailer direct shipment, and, importantly, judicial uncertainty, the most qualified sellers of wine in America, wine retailers, are largely banned from participating in the growing wine retail marketplace," says the NAWR.
And it doesn't help that we are dealing with commerce rules that were established in the 1930s!
The 18th Amendment, which prohibited the manufacturing, distribution, and sale of alcoholic beverages in the U.S. in 1919, was repealed in 1933 with the 21st Ammendment.
So while now its legal to make and sell alcohol, "only 14 states allow out-of-state retailers to legally ship wine to their consumers," according to the NWOA.
And now that is going to go away?
"How do we plan for the future? How do you run a business?" asks Fisch.
So do retail shops and sites upgrade their tech systems to keep moving forward, as every other industry is doing, or should they be laying off people? "I can't stand what's happening," says one online retailer who has requested to remain anonymous. "It frightens me."
And think about what this does for the consumer. If you can't have wine shipped from your favorite site or wine club, then you will be forced to shop locally. And while that is not bad thing, it dramatically reduces price competition and inevitably will increase the cost of your favorite bottle.
There is a volume issue as well. There already is too much wine being produced worldwide and not enough drinkers. "What happens when retailers can't ship to the major markets anymore? How will all that wine get sold?" asks Darian Wilson, co-founder of Wine Kloud. Very few wineries have the extra marketing dollars to do it themselves.
The wine world is the only industry that is going backwards, not forwards. People are already being laid off, and many sites are limiting the states they ship to.
So please, talk to your retailers. Ask them if their shipping abilities are being limited.
We should be encouraging interstate commerce. Not discouraging it. Because it's not just about the great bottles of wine that may become unavailable to you; there are also jobs at risk here.
So you can be sure that we will continue to dig into this issue.