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BevAlc Roundup | California Revamps Sales Tax Rules, What’s Impacting the DtC Market, and Is Climate Change Affecting How Wine Tastes?

Mon, 05/20/2019 - 15:59

We are now a little over a week away from our 2019 ShipCompliant by Sovos Compliance Wine Summit. This annual event, previously known as the DIRECT conference, is one of the highlights of the year for us at ShipCompliant by Sovos, as we are able to connect directly with our users on what is happening in the world of wine regulation and what changes we are making to our services to better enable this industry to remain in compliance with those regulations.

There have been a number of changes over the past decade both to the regulation of the wine market, particularly the direct-to-consumer shipping market, and to ShipCompliant itself. But what hasn’t changed is our commitment to connect with and support our users. So if you haven’t signed up yet, sign up today! This year’s Wine Summit will be held on May 30 at the Napa Valley Marriott.

For this week’s roundup, we look at recent changes to California’s sales tax regulations that will have a big impact on wineries making direct-to-consumer shipments in the state; there was also some major news last week in the world of wine criticism, when Robert Parker announced his retirement after decades of shaping the taste of wine; and we jump on the Game of Thrones bandwagon, and look at some recent brands that have come out based on the wildly popular series.

In case you haven’t heard, the 2019 Direct-to-Consumer Wine Shipping Report has been published. Download your copy today here.

Thanks for reading the Roundup this week. As ever, be sure to check out the rest of the ShipCompliant by Sovos blog for regular updates, and we’ll see you again in another couple of weeks.

Regulatory News and Discussions

TTB Newsletter | This week’s top news includes some of the most common reasons why we return alcohol beverage formulas for correction. Also, two of our senior leaders were recently awarded the 2019 Treasury Leadership Legacy Honor, and we’re hiring an alcohol labeling specialist in Washington, DC. TTB

California Amends Tax Rules for Delivered Sales Affecting Instate Wineries | California’s recent change establishes a requirement on in-state businesses to collect more local district taxes, which will affect almost every winery shipping wine in the state. ShipCompliant by Sovos

Trump’s Trade War With China Hurting U.S. Wine Industry’s Bid to Increase Sales There | New tariffs imposed by Beijing Monday will make U.S. wine an even more expensive product for Chinese consumers, as their leaders battle with the Trump administration in an escalating trade war between two of the world’s largest economies. Press Democrat

Majority of US Senators Support Permanent Tax Reform for Brewers, Importers | A majority of U.S. Senators support making permanent excise tax relief for alcohol producers and importers. Brewbound

Governor Signs Bill Changing LIquor Distribution Rules | Oklahoma Senate Bill 608 requires the top 25 wine and spirits manufacturers to offer their products to all wholesalers. The Journal Record

Another Attempt to Let USPS Ship Alcohol | Legislation has recently been reintroduced in the House to allow the Postal Service to ship alcoholic beverages to consumers. Fed Smith

Industry Updates: Market Conditions and Developments

A Tribute to Robert M. Parker Jr. | The father of modern wine criticism, our publication’s founder and namesake, my greatest mentor and a dear friend, it is with mixed feelings that I announce that Robert M. Parker Jr. will, as of today, be formally hanging up his wine criticism boots and retiring from Robert Parker Wine Advocate. Robert Parker Wine Advocate

US Wine, Beer, Spirits Consumption “In a Holding Pattern” as Public Leans Toward Less Alcohol | The huge size of the 2018 wine grape harvest in the North Coast and California and the changing tastes of U.S. consumers other beverages were evident in sobering sentiments of industry professionals and consumers presented at the outset of the event. North Bay Business Journal

Top Issues Impacting the DTC Channel | About five years ago, 90% of direct-to-consumer wine sales came from tasting room visitors and wine clubs. Now, that’s dropped to about 40% with the other 60% of DTC sales coming from online shopping, according to ShipCompliant general manager Larry Cormier. Wine & Spirits Daily

Pride in a Job Well-Done, or Blood Money? | The cost of learning the truth from the TTB about the benefits to investigators from making cases against industry members. Booze Rules

New Distribution Service Offers Brewers a Chance to Test Markets, Fill Excess Capacity | Starting in June, nine U.S. states will begin receiving limited shipments of popular but hard to obtain craft beers via a new program called “Guest Brewer.” Brewbound

Digestif

Wine Tasting in Westeros | Game of Thrones, one of the biggest television events in history, has spawned a range of merchandise. But is wine from a world of assassination, brutality and zombies safe to drink? Drinks Today

Do Your Favorite Wines Taste Different? | There’s a good chance it’s because of climate change. Heated

How Sulfites Affect a Wine’s Chemistry | Wine professionals discuss sulfur’s impact on everything from oxidation to aromatic compounds and texture. SevenFifty Daily

These Experimental Distilleries Are Using Science to Artificially Age Whiskies | From soundwaves to pulses, nothing is off limits. Robb Report

What Are the Most Asked Questions in a Wine Shop? | Unlike restaurants, where it’s easy to feel restricted by the selections or intimidated by sommeliers, wine stores are the perfect place to take your time and learn new things. Wine Enthusiast

 

Find out how ShipCompliant by Sovos can help your business stay on top of compliance by signing up for a free demo.

The post BevAlc Roundup | California Revamps Sales Tax Rules, What’s Impacting the DtC Market, and Is Climate Change Affecting How Wine Tastes? appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

California Amends Tax Rules for Delivered Sales Affecting Instate Wineries

Wed, 05/08/2019 - 11:06

On April 25, 2019, the Governor of California approved Assembly Bill No. 147, amending the state’s rules on when and where businesses shipping through the state have a sales tax obligation, which will likely have major implications for wineries selling direct-to-consumer (DtC).

Over the last year, we at ShipCompliant by Sovos have been monitoring as states have adopted economic nexus rules following the Supreme Court’s ruling in South Dakota v. Wayfair last June, and how they impact the DtC wine shipping market. For the most part, these changes to nexus rules have been focused on increasing tax collection from out-of-state retailers.

California’s recent change, however, establishes a requirement on in-state businesses to collect more local district taxes, which will affect almost every winery shipping wine in the state.

Local district taxes are voter-approved taxes imposed by cities, counties and other local jurisdiction that are added to the California base sales and use tax rate.

What Does Assembly Bill No. 147 Require?

The main provisions of the bill require remote sellers to collect and remit California sales and use tax if the seller had over $500,000 in sales of tangible personal property for delivery into California in the preceding or current calendar year. A similar requirement had previously been set out by the California Department of Tax and Fee Administration (CDTFA) in December 2018, where the economic thresholds for remote sellers was set at 200 or more separate transactions or retail sales in excess of $100,000. The new bill raises the revenue threshold to $500,000 and removes the per-transaction threshold.

However — and this is where we see the biggest potential impact on California wineries, the bill also amends the rules regarding when an in-state and out-of-state business must collect local district taxes.

California law prior to Wayfair only required a business to collect a local district tax if the business was “doing business” in that district. Last December, the CDTFA set out a new rule, in light of Wayfair, stating that if a California business met the $100,000 in sales or 200 separate transaction threshold in a district then the business would be required to collect that district’s local taxes. This new rule went into effect on April 1, 2019.

This new bill changes that rule. Retroactively applying to April 1, 2019, and going forward, if a business makes over $500,000 in annual revenue in California, it is required to collect and remit all district taxes, regardless of how much revenue it receives from any single district. This means that all California wineries with an annual revenue of $500,000 or more will have to collect district tax on all shipments they make within the state, even for districts where they make a single shipment.

Non-California wineries have long been required to collect sales tax on shipments to the state, as a condition of getting a DtC license there. However, this requirement only extended to the state rate of 7.5% (6% plus the 1.5% state-wide local rate), but not to the district taxes. For those wineries, a district tax only applied if they were “doing business” in that district, which implied specific physical presence there. Going forward, non-California wineries will have to collect and remit the same district taxes for all locations in the state if they meet the $500,000 of California revenue threshold as an in-state winery.

What Can I Do to Prepare?

Wineries shipping DtC in California must now be ready to calculate local district taxes across the state, and cannot rely on only collecting tax based on their premises rate. This will require a concerted effort to look up rates across the state at the time of purchase, to avoid the potential pitfalls of under- or over-calculating tax collected from customers.

ShipCompliant by Sovos users currently can receive California district tax rates across the state. This can be very easily done by switching one’s California Tax Preferences to “Local Taxes.” Thereafter, any tax lookup for a California location, whether done in an account or through our integration with sales systems, will include the proper local district rate.

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We have seen a tremendous amount of change regarding tax policy over the last year as states move to expand tax obligations on out-of-state businesses. For the most part, DtC shipping wineries have not been greatly affected as most states have for years required them to accept a tax obligation in order to ship wine (except for a few states, like Colorado, Minnesota, and Iowa).

This change by California, however, will have a major impact on DtC shipping wineries, as California is both by leaps and bounds the largest source and destination for DtC shipped wine. Starting April 1, 2019, and going forward, the glut of these shipments will now need to have local taxes assessed and paid to the state.

View Assembly Bill No. 147 in its entirety.

Request a demo of ShipCompliant

The post California Amends Tax Rules for Delivered Sales Affecting Instate Wineries appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

Colorado to Enforce Sales Tax Rules for Remote Sellers In June

Thu, 05/02/2019 - 15:36

When a winery ships wine direct-to-consumer (DtC) across state borders, the sale skips over distributors and retailers, who are generally the parties who collect and remit the recipient-state’s taxes. As such, when a state moves to permit DtC shipping by wineries, they often require that any applicant for a DtC license first accepts an obligation to pay the state taxes that it would otherwise receive.

Unlike most states, however, Colorado does not make the assumption of a sales tax obligation a condition of getting a DtC license. Instead, a winery shipping to the Centennial State would only need to collect and remit sales taxes if it has nexus (that is, a substantial connection) there.

Previously, nexus was only established by having a physical presence in the state. However, like many other states, subsequent to the South Dakota v. Wayfair Supreme Court decision, Colorado enacted rules which sought to compel sales tax collection and remittance responsibility on sellers based on their economic presence in Colorado, regardless of whether they may be physically located there.

In December 2018, the state of Colorado made substantial changes impacting the sales tax collection and remittance requirements imposed on both in-state and remote sellers. The state extended a grace period for companies to comply with these requirements through May 31, 2019.

But beginning June 1, 2019, under the new rules, many wineries will be required to collect Colorado state sales tax and any local sales tax for state-administered localities. The rate will be determined based on the location of your Colorado customer. These rules specifically do not impact any obligation sellers may have in home-rule localities (these are localities in Colorado that have determined to administer their sales taxes entirely independent from the state agency).

New Obligations for Remote Sellers

In line with other states, the requirement is imposed on any organization that, in the previous or current calendar year has:  

  • $100,000 or more of gross sales or services delivered in Colorado, including exempt sales.

Any winery that meets this threshold will now have nexus in Colorado and be required to collect and remit sales taxes on their DtC shipments of wine to the state. (Previously the state had indicated that retailers making 200 or more transactions in the state would also have nexus; however, in the latest rules from the state, that threshold has been removed.)

This will require that the winery takes the following actions:

  • Register with the Colorado Department of Revenue (DOR) as a Sales Tax Collector. This may be done at https://www.colorado.gov/revenueonline/_/.  Any winery that had previously registered as a Use Tax Collector will need to amend its registration.
  • During, or after, that registration the winery must also register under their Sales Tax Account for each tax jurisdiction that they will ship into. These jurisdictions are determined by the state, and while the winery is required to only register for those into which they actually ship, it may be worthwhile to register for all of them (683 in total) — the registration is at no cost.
  • For each tax jurisdiction that the winery selects, the DOR will assign a unique four-digit code that must be attached to the winery’s Colorado Account Number when filing their Sales Tax Returns, in order for the state to process how local taxes should be disbursed.
  • ShipCompliant users should make sure to enter these codes into their account so that we can properly populate the necessary Sales Tax Returns. We have recently added an upload function to our license portal so that a user can add all of their codes with one single action. If you are a ShipCompliant user you should receive direct messages soon that will more thoroughly explain how this should be done.

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Wineries shipping DtC have long had to deal with sales tax rules and regulations across the country, so in many ways they are much more prepared for the post-Wayfair world of economic nexus to which other remote sellers are just getting used. Nevertheless, there are still states like Colorado that are presenting new challenges for DtC wineries (and Colorado, with its uniquely complex sales tax policies, makes that an extra challenge).

Wineries would do well to review their sales tax practices to ensure they are best enabled to handle the changing world of sales tax regulation. We at ShipCompliant by Sovos are committed to providing that enablement.

The post Colorado to Enforce Sales Tax Rules for Remote Sellers In June appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

Nominate Your Winery for the 2019 ShipCompliant Vinners Awards

Tue, 04/30/2019 - 15:14

Is your vineyard a Vinner? It’s time to find out.

The annual Vinners Awards will make their debut at the 2019 ShipCompliant Wine Summit in Napa at the end of May. Any vineyard that is a ShipCompliant customer can nominate itself or a peer to win an award on one of the following categories:

  • Most creative and captivating label
  • Most engaging tasting room experience
  • Most successful wine club promotion
  • The “must follow” Instagram account

Winners (or Vinners, in this case) will be announced in an awards show at the ShipCompliant Wine Summit on May 30. Aside from earning glory and fame, Vinners will be featured on the ShipCompliant website and receive an official award to symbolize their achievement.

All ShipCompliant customers are eligible; you do not need to attend the 2019 ShipCompliant Wine Summit to win an award.

Nominate your vineyard by May 10 to be eligible to win! 

The post Nominate Your Winery for the 2019 ShipCompliant Vinners Awards appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

Roundup: Oklahoma Distribution, Black Wine Consumers, Climate Change

Mon, 04/29/2019 - 13:08
Oklahoma Distribution Laws Get Contentious, Why Doesn’t The Wine Industry Pursue Black Consumers?, and Climate Change and Wine

During this last couple weeks, there came and went the dubious — or at least psuedo — holiday of 4/20, a day based around consuming cannabis (thankfully, alcohol still has almost every other holiday claimed for its consumption). As such, it was likely no surprise in the number of articles we saw talking about pot’s burgeoning legalization and what that means for other industries — in particular the beverage alcohol industry. (Not that there hasn’t already been a lot said about that, from chicken little claims that the sky is falling to more mellowed relaxed comments that there’s plenty to pass around.)

To highlight these articles, we have selected three in particular that caught our attention, set out in a special section below. But there was lots of other news that came out as well, so in addition to Getting Into the Weeds, this week we look at how vague trade practice rules set out in the 1930s and 1980s are stifling growth today, also, ways for wineries to better engage with their customers online and spike e-sales, and what it takes to be a standout judge of whiskey.

In case you haven’t heard, the 2019 Direct-to-Consumer Wine Shipping Report has been published. Download your copy today here.

Our annual Global Compliance Wine Summit (previously DIRECT) will be held on May 30 at the Napa Valley Marriott. We are putting together a great schedule, so make sure to sign up soon.

Thanks for reading the Roundup this week. As ever, be sure to check out the rest of the ShipCompliant blog for regular updates, and we’ll see you again in another couple of weeks.

Regulatory News and Discussions

TTB Newsletter | This week’s top news includes the publication of our “TTB Bootcamp for Brewers” presentation given at the Craft Brewers Conference, information about which file types are compatible with Permits Online, and a TTB auditor job announcement. TTB

Is a 1935 Alcohol Beverage Federal Trade Practice Law Stifling Innovation? | Congress’ aim to prevent the recurrence of the “social evils” that led to Prohibition is the centerpiece of the unfair trade practice provisions of the Federal Alcohol Administration Act of 1935. Booze Rules

Tariffs Fomenting Turmoil in World Wine Markets | California is on the front lines of President Donald Trump’s unwise trade wars, and the wine industry is under fire. The Press Democrat

Are Crafts Looking to Kill the Pubs in Illinois? | There is a theory out there, that is actually backed up by statistics, that the presence of craft brewers is hurting bars and taverns. Irish Liquor Lawyer

Willamette Valley Wine Purity Bills Pass Oregon Senate | Two bills to raise the varietal and regional content standards for Willamette Valley wines passed the Oregon Senate on Wednesday, and now move to the House. Portland Business Journal

Duopoly or Pro-Business? Shots Taken In Oklahoma Liquor Distribution Fight | The difference between “shall” and “may” in one portion of Oklahoma’s new alcohol laws has left liquor stores, a locally owned wholesaler and some legislators pushing to break up what they call a duopoly in the liquor distribution market. NonDoc

Industry Updates: Market Conditions and Developments

Why Is the Wine Industry Ignoring Black Americans’ $1.2 Trillion Buying Power? | You see, apparently, black people know very little about wine. It’s a novelty for us, and when we do drink it, the sweeter the better. VinePair

Why Breweries Are Turning to Small-Format Cans | The opportunity to reach new customers is just one factor attracting brewers to the eight-ounce can. SevenFifty Daily

Amazon Wine 3.0: Is the Online Retail Giant Getting Back in the Wine Business? | Amazon has twice given up selling wine over the past decade, perhaps the two most notable flops in the e-commerce giant’s history. But it looks like the company may be getting ready to try again – call it Amazon wine 3.0. Wine Curmudgeon

Gallo Deals Are the Gifts That Keep on Giving for Premium Wine | The premium branded wine market can do with all the help it can get which is what makes E&J Gallo’s acquisition strategy potentially so important, not just for itself, but for the overall wine industry. The Buyer

How a Digital Negociant Helped Change the U.S. Wine World | The combination of greater DtC potential and digital commerce, when combined with a French ‘negociant’ model, led to surprising success for a California company. Forbes

Are You Selling Enough Wine Online? | Could it be that U.S. wineries are not reaching out to consumers via digital marketing the way companies in other consumer products industries are? Winebusiness.com

Getting Into the Weeds

What Does the Wine Industry Have to Learn from the Cannabis Industry? | Just as the burgeoning cannabis industry followed lessons from the wine industry as it has worked to establish its legitimacy, wine can learn from cannabis in connecting with consumers. Fermentation

Why Weed and Wine Have More in Common Than You Think | We want people to think of cannabis in the same way they think of wine, as a gourmet product. Wine Enthusiast

How to Succeed In Wine and Weed: The Herb Somm Tells Her Story | While some in the industry are attempting to sway consumers back towards wine, other brands and corporations are investing in marijuana as a way to diversify their holdings. Forbes

Digestif

Thinking Outside the Wine Box about Climate Change & the Future of Wine | Miguel Torres recently warned that the wine industry is not doing enough to fight climate change and there is no doubt that he is right. The Wine Economist

The Future Is Bright For Texas Wine | An emerging wine region on the cusp of something great. Wine Spectator

The Fine Art of Being a Whiskey Judge | A lot of blood, sweat, and tears goes into honing one’s craft; in this case, spirits. The Whiskey Wash

The post Roundup: Oklahoma Distribution, Black Wine Consumers, Climate Change appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

BevAlc Roundup | TTB Labeling Comments Period Extended, Record California Grape Crush in 2018, and Be Your AVA’s Champion!

Tue, 04/16/2019 - 09:37

Last week saw the publication of a number of industry and agricultural reports from 2018, including global grape production, California wine crush, and craft beer sales, and we’re happy to say that more-or-less everything looks positive. Even the lower-than-in-the-past growth numbers for craft beer are a sign of continued success, especially when considered against other non-beverage alcohol industries.

But that’s hardly all the news we have to report on today. This Roundup also includes a couple looks at the looming ill-effects caused by the ongoing trade war and what might happen if it ratchets up against Europe. We then also look at the announced Gallo-Constellation deal, and hear how women are coming to lead and dominate the conversation about beer regulations in D.C.

In case you haven’t heard, the 2019 Direct-to-Consumer Wine Shipping Report has been published. Download your copy today here.

Our annual Global Compliance Wine Summit (previously DIRECT) will be held on May 30 at the Napa Valley Marriott. We are putting together a great schedule, so make sure to sign up soon.

Thanks for reading the Roundup this week. As ever, be sure to check out the rest of the ShipCompliant blog for regular updates, and we’ll see you again in another couple of weeks.

Regulatory News and Discussions

TTB Newsletter | This week’s top news includes the top 5 reasons why you should file your permit applications online versus mailing paper forms, plus information about TTB’s fiscal year 2018 annual report that is now available online, and an adjustment to the civil penalty for violations of ABLA. TTB

Looming Trade War Bodes Ill for Wine | U.S. Editor W. Blake Gray offers his take on the threat of tariffs against European wine. Wine-searcher.com

Wine Industry Floods the TTB With Its Opinions On Wine Nutritional Labeling | Last month the TTB extended its deadline for Notice No. 176, the so-called “Modernization of the Labeling and Advertising Regulations for Wine, Distilled Spirits and Malt Beverages,” until June 26, 2019. Forbes

FTC Kills Deal to Merge Alcohol Distributors | The U.S. Federal Trade Commission said on Monday it had pushed two wine and spirits distributors to scrap their merger because of “significant concerns” about the deal. Reuters

California Wineries Shut Out Form China Amid Trade War | When China imposed retaliatory tariffs on American goods last April, vintners at Wente Vineyards in Livermore feared the move would push them out of China, the world’s fastest-growing wine market, for months or years. They were right. SF Chronicle

Amazon Planning a Deeper Diver Into Alcohol Sales? A D.C.-Area Job Posting Suggests So | Amazon.com Inc. is looking for a booze business policy and lobbying expert, and it could portend a push into more alcohol sales for the online retail giant. Washington Business Journal

Industry Updates: Market Conditions and Developments

California Crushes Record 4.3 Million Tons of Winegrapes in 2018 | According to the report, the state crushed more than 4.28 million tons of wine grapes in 2018 – up by 7 percent compared to 2017, when the state crushed approximately 4 million tons of wine grapes. Wine Business

Global Wine Output Recovered in 2018 from 60-Year Low | After a 60-year low in 2017, when production was dented by extreme weather in Europe, including drought and storms, world output rose 17 percent last year to 292.3 million hectoliters. Reuters

CBC: Slowing Growth in 2018 Was “Not a Blip” | Slower growth and increased competition are the “new normal,” Brewers Association (BA) leaders hammered home on the second day of the trade group’s annual Craft Brewers Conference (CBC). Brewbound

What Gallo’s $1.7 Billion Buyout of Constellation’s Bargain-Priced Wines Really Means | The 30 brands include familiar winery names like Ravenswood, Clos du Bois, Manischewitz, Cook’s and Mark West, mostly bottles that sell for $11 or less. SF Chronicle

Digestif

Female Lobbyists Change Face of Beer Industry | The leading voices for the beer industry in Washington, D.C., are women, breaking the stereotype that beer is a male-dominated business. The Hill

On Wine Marketing — Be the Winery That Champions Your AVA | I’m here to urge wineries to consider being the champion of their sub-appellation; to be the winery that educates about all things home turf; to be the advocate and endorser of that officially recognized region they call home. Fermentation

What Is Oxidation Doing to My Wine? | Oxidation can be responsible for the flat taste of wine that’s past its drinking window, but it can also be the element that unlocks the array of flavors that wine grapes can offer. Wine Enthusiast

Three Studies Take A Look at Various Wine Bottle Closure Preferences | in 1999 synthetic was about 2% of the wine bottle closure market, screw cap was at 3%, one-piece natural cork was about 34% and technical (composite) cork made up 61%. Forbes

What’s Fueling the Rapid Growth of Hard Seltzer? | Drinks professionals discuss the factors behind the low-ABV category’s rise — and its impact on the industry. SevenFifty Daily

 

Find out how ShipCompliant by Sovos can help your business stay on top of compliance by signing up for a free demo.

The post BevAlc Roundup | TTB Labeling Comments Period Extended, Record California Grape Crush in 2018, and Be Your AVA’s Champion! appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

Celebrate National Beer Day by Getting Compliance under Control

Fri, 04/05/2019 - 12:52

Drinking beer is easy and fun. Brewing it is more difficult, but still entertaining. Distributing it to different states and managing a brewery without running afoul of a thick book of laws and shipping regulations? Well, that’s something else altogether.

There’s a reason April 7 is National Beer Day and not National Beer Regulation Compliance Day. Beer is fun. Compliance isn’t. But it’s necessary for brewers of all sizes, with states having wildly varying and inevitably confusing laws on how beer can be distributed and shipped nationwide.

Compliance in the face of competition

Of course, a brewery is a business, and it’s not all supposed to be fun. But in a practical sense, keeping up with a host of changing regulations is not something most craft breweries have the resources to do. The problem is that it matters.

In order to grow, breweries have to beat competitors to market with new products and get the attention of distributors, who can choose from multiple products on offer. A brewery that doesn’t know how to navigate compliance within a particular state could find itself unable to enter that market and therefore at a competitive disadvantage.

Competition for craft breweries is difficult as it is. Beer sales and production have actually fallen recently, but that hasn’t stopped more small brewers from entering the scene, as the number of breweries in the U.S. continues to grow rapidly. Those two factors combined leaves more brewers competing for a shrinking market share, making distribution a critical task for any company looking to get a foothold in the beer market.

Big corporations aren’t helping smaller competitors, either. Brewing giants have been snapping up much smaller competitors and rebranding them as “craft” brands but with the full support of giant corporate infrastructures behind them. That puts even more pressure on smaller brewers to keep their operations growing in the face of unprecedented resistance.

The advantages an automated solution for compliance  

Brewing innovation and smart marketing are what lead to growth for brewers. Compliance is more of a hassle, but it’s one brewers can’t ignore. That’s why the idea of a solution to centralize and automate compliance is so appealing. Trying to maintain staff to keep up with changes in regulations and distribution laws is prohibitively difficult and expensive, and doesn’t align with the core mission of constantly improving what’s in the keg or bottle.

With an automated compliance solution, brewers can shift the burden of keeping up with regulatory changes, making sure to have access to the latest rules and forms, while also working with a partner that can interface directly with federal and state regulatory agencies, like PRO. They can also eliminate expensive and error-prone manual processes for keeping up with distribution rules and instead automate compliance management, which frees up time for them to focus on their businesses.

Another advantage of an automated solution is the ability to boost distribution and increase efficiency by syncing information through a cloud-based solution that requires no on-site installation and little maintenance. Real-time visibility into market trends lets brewers monitor competition and have the insight they need to develop new concepts.

Going forward with confidence

Carving out a spot as a successful brewer isn’t getting any easier, and neither is handling the compliance processes that brewers have to master in order to grow their businesses. Brewers should be able to focus on beer, not on paperwork–a compliance solution lets them do just that.

 

Join ShipCompliant at the Craft Brewers Conference Happy Hour, Monday, April 8, at the CBC in Denver! Also, come visit us at booth 17076. Or discover why brewers have been turning to ShipCompliant for years to manage compliance processes.

The post Celebrate National Beer Day by Getting Compliance under Control appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

BevAlc Roundup | Handling Prop 65 Notices, the Fastest Growing Breweries, and What Makes it “Tennessee” Whiskey?

Tue, 04/02/2019 - 13:07

It might seem like a joke, but it’s April already! No matter how much it may feel like 2019 is zipping past, though, we still appreciate taking the time to look around and catch up on everything that’s going on to affect the beverage alcohol industry. For that, we provide the Roundup.

This week we look at different ways that states are adjusting their rules for shipping wine and how compliance needs to be managed in these states; we also take an extended look at wine marketing and how to address the desires and expectations that different generations bring to wine; and finally, we have a report of an April Fool’s Joke concerning some pretty terrible whiskey.

If you are going to be in Denver April 8-11 for the Craft Brewer’s Conference, make sure to stop by our booth and say hi.

In case you haven’t heard, the 2019 Direct-to-Consumer Wine Shipping Report has been published. Download your copy today here.

Our annual Global Compliance Wine Summit (previously DIRECT) will be held on May 30 at the Napa Valley Marriott. We are putting together a great schedule, so make sure to sign up soon

Thanks for reading the Roundup this week. As ever, be sure to check out the rest of the ShipCompliant blog for regular updates, and we’ll see you again in another couple weeks.

Regulatory News and Discussions

TTB Newsletter | This week’s top news includes a new FAQ about ice cream and other frozen products made with distilled spirits, what’s new in Permits Online, and a reminder to register for one of our free trade practice seminars. TTB

New Mexico, Kentucky and FedEx Juggle How to Handle Wine Shipping | While the wine industry awaits a Supreme Court decision (scheduled for this June) in connection with an alcohol retailer residency law in Tennessee that some believe may open interstate wine shipping for retailers, three developments on the wine-shipping subject recently took place. Forbes

The Million Dollar Question for Wine Shipping | A recent Mississippi legal decision created the potentially million-dollar question for wine shipping: where does the sale of wine occur? Irish Liquor Lawyer

Winery Asks New Jerseyans to Free the Grapes. Let Them Ship Wine to the Garden State | New Jersey law severely and arbitrarily limits which wines consumers can get direct-shipped from the winery to their home or office, a West Coast winery says. NJ.com

Tariffs Hit American Whiskey Business Hard | Producers are struggling to battle off lost profits from reduced export sales, which ironically could also mean raised prices at home, too. Barron’s

Prop 65 — Escaping a “Notice of Violation” | Every business — wherever located — that sells or ships a product with a chemical on the Proposition 65 list (over 1,000) to a California resident, must comply with the mandatory warnings. Booze Rules

Industry Updates: Market Conditions and Developments

How Can Wineries Reach Millennials? Personal Experience & Shipping Convenience | By extending the tasting room experience online, connecting with younger consumers directly and offering them greater convenience and exclusivity, wineries can forge lasting brands fit for this growing market. Wine Industry Advisor

The Truth About Wine Shipping and Michigan | A recent story run by a few Michigan TV stations reported the claim by the Michigan Beer and Wine Wholesalers Association that 185,408 bottles of wine were illegally shipped into the state of Michigan in the last quarter of 2018. NAWR

These Are the Fastest-Growing Breweries in America, According to the Brewers Association | An Iowa craft brewery topped the Brewers Association’s (BA) list of the 50 fastest-growing breweries of 2018, but it wasn’t Toppling Goliath. Brewbound

I Can’t Take the Lunacy! | In the 2019 SVB State of the Industry Report I pointed out some changes we as a wine industry are facing, including the lack of engagement by our younger consumers which I attribute in part to the cumulative negative health messaging coming from neo-prohibitionists. SVB on Wine

Saving Wine From the Sober Generation | If you thought the millennials were hard to please, wait until you see what’s coming after them. wine-searcher.com

Digestif

The Worst #@*$ Whisky I’ve Ever Tasted! | This is the story of that whisky, and how I came to taste it in a prank worthy of an April Fool’s joke. Whisky Cast

The West Coast Wine Revolution | Producers make their wine in a funky shed, far from the tourist temples of Napa Valley. Financial Times

Tennessee Whiskey and the Question of Calling it a Bourbon | Tennessee whiskey is a style of whiskey that, like most whiskey styles in the U.S., has to follow some strict rules in order to use its moniker. The Whiskey Wash

6 Descriptors Beer Professionals Avoid | Hoppy, light, and funky are among the vague terms beer purveyors swap out to help customers find desired flavors and styles. SevenFifty Daily

 

Find out how ShipCompliant by Sovos can help your business stay on top of compliance by signing up for a free demo.

The post BevAlc Roundup | Handling Prop 65 Notices, the Fastest Growing Breweries, and What Makes it “Tennessee” Whiskey? appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

5 Questions About DtC Wine Shipping and FedEx HAL

Tue, 03/26/2019 - 13:32

In a recent webinar, Jerry Van Sickle, district sales manager – wine at FedEx; Zach Kamphuis, sales at Commerce7; and our own Curry Wilson, strategic partner manager at ShipCompliant by Sovos shared how FedEx Hold at Location (HAL) can improve customer experience. We received some great questions, which we compiled for Jerry, Zach and Curry to answer below.

(You can watch the full webinar on-demand here.)

 

Q: When will HAL be ready for front-end system companies other than Commerce7?  

A: This functionality is available to any front-end partner to implement. However, it does require development work to build into. We are working with a number of additional front-end partners on this initiative and will continue to roll it out with additional partners.

 

Q: Can a club member select a HAL location as a default shipping preference, or do they need to select HAL for each individual shipment?

A: Yes – a club member can select a Hold at Location as their default shipping preference. When a customer initially joins a club, they can opt to ship the club to a HAL, and all club packages will, by default, be sent there.  

 

Q: Is it possible for the designated recipient to allow another household member to pick up the package from the HAL?

A: Yes, but that adult member of the household has to show a match on their ID to the home address on the package.

 

Q: Is there a limit on how long a customer can leave a package at a HAL, and are there any cost implications (for the winery or consumer) to use HALs?

A: HAL is free, and there is not any kind of cost incurred. Once a package arrives into HAL, it will he held for seven calendar days (five business days). However, if enrolled into FedEx Delivery Manager (DM), the end consumer can request a vacation hold and it can be held up to 14 calendar days. But, the recipient has to be enrolled into Delivery Manager and must make the direct request to FedEx thru DM access.

 

Q: Does sales tax get calculated automatically on the customer’s shipping address at the time an order is placed with a HAL selected, or is this something that will need to be calculated manually by the winery?

A: Through the integration between Commerce7 and ShipCompliant, the sales tax and any compliance checks are still calculated based on the original shipping address and end destination of the wine. The HAL address comes through as a third address that is used to indicate a different hold location and different label for FedEx or fulfillment companies. Any future integrations with the ShipCompliant HAL API will be required to operate this way, so your compliance and tax are not compromised by this delivery option.

 

To learn more about how ShipCompliant can help your business, click here.

 

The post 5 Questions About DtC Wine Shipping and FedEx HAL appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

Direct-to-Consumer (DtC) Wine Shipping Trends Webinar

Thu, 03/21/2019 - 11:00

The ninth edition of our annual Direct-to-Consumer (DtC) Wine Shipping Report 2019 with our partners, Wines Vines Analytics, not only confirmed our earlier prediction that Sonoma County would overtake Napa County as the largest source of DtC wine shipments, but also that the DtC channel would top $3 billion in 2018. Join us for a live webinar, “Direct-to-Consumer (DtC) Wine Shipping: Highlights and Trends from 2018,” on Thursday, March 28, 2019, to discuss key findings and real-world examples of growth trends from 2018 and some predictions for 2019.

DtC Channel Maturity

Additional highlights of this year’s 2018 year-in-review report show a healthy growth of winery shipments over 2017, yet the volume of wine shipped and value of those shipments underperformed the average increases for the past seven years. Did price hikes, a key theme in 2018, have a factor in key wine regions? What about the California wildfires? [Download the full 2019 DtC Wine Shipping Report] A Brief Look at Varietals

Napa County, which has consistently driven the growth of the overall wine market, saw a considerable dip in volume and value of wine shipments to consumers. But how did its varietals fair during 2018?

  • Blend – Red saw a 7 percent price increase in the region.
  • Cabernet Sauvignon saw a 5 percent price increase; while
  • Chardonnay had a modest 3 percent increase in price.
  • Pinot Noir had the largest price increase in Napa, rising 12 percent.

This helped to propel the average price-per-bottle increase shipped from Napa County wineries to 7.1 percent, well above the overall shipping channel’s increase we cover in the report. All slowed in volume shipped as Napa sacrificed volume for price increases.

Popular Varietals – Still Holding Strong

Cabernet Sauvignon, Pinot Noir, Red Blends, Chardonnay and Zinfandel together represented 60 percent of the volume of wine shipped direct to consumers in 2018, holding their reign as the top five varietals shipped to consumers. Pinot Noir shipments outperformed the overall DtC channel, even while average price-per-bottle shipped increased 2.6 percent. Other varietals with impressive shipping momentum in 2018 included Zinfandel (extending its gains from 2017), Other Reds, Cabernet Franc (continuing its rise beginning in 2014) and Sangiovese.

Destination of Shipments by Volume

While California remains the most common destination for wine shipments, accounting for 30.2 percent of the volume of all winery-to-consumer shipments nationwide, South Dakota saw the biggest volume increase (outside of Oklahoma, the only new shipping destination) at 78.2 percent. Download the report for a map of every wine shipping destination by state on page 26. Pennsylvania, after only two full years for legal direct shipment from wineries, now sits in eighth place in total volume of shipments, and saw a 29.6 percent increase in volume in 2018.

2018 Wine Analysis by Price

Price hikes were a key theme in 2018, with an overall 2.4 percent increase in the average price-per-bottle shipped—the largest year-over-year increase since 2011. For many regions, these price increases coincided with increased sales volumes. Oregon, for example, continued its seven-year growth run, considerably outperforming the overall DtC wine shipping channel in 2018, despite its average price-per-bottle shipped increasing by 1.4 percent. Washington also outperformed the overall shipping channel in volume and value, but only through decreases in the average price-per-bottle shipped.

Almost without exception, price increases in the overall winery-to-consumer shipping channel have been followed by flat or declining prices the following year. The price increases in 2018 on direct shipped wines were historically large. Should this necessitate tempered optimism heading into 2019?

 

Join us for a live webinar, “Direct-to-Consumer (DtC) Wine Shipping Highlights and Trends from 2018,” on Thursday, March 28, 2019 to discuss key findings and real-world examples of growth trends from 2018 and some predictions for 2019.

The post Direct-to-Consumer (DtC) Wine Shipping Trends Webinar appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

BevAlc Roundup | TTB Continues Consignment Sales Investigations, Wine Exports Drop in Last Year, and How to Beat Counterfeit Wines

Mon, 03/18/2019 - 15:30

In the last Roundup, we predicted that the cold winter weather was finally on its way out — and then large parts of the country were hit by intense snow storms! We’ll chalk that up to a coincidence this time, and continue to extend our hopes for a warm, pleasant and imminent spring. Though as part of this week’s Roundup we have an article about how much benefit the wine industry does receive from these extended snow storms — so we can at least be happy for the moisture.

For this week’s Roundup, we also look at new rules for nutritional and informational labeling that are being considered by the TTB, what the wine industry can and should do to expand its marketing to Gen Xers (and everyone else, by the way), and whether the concept of terroir should be applied to whiskey like it is for wine.

In case you haven’t heard, the 2019 DtC Report has been published. Download your copy today here.

Thanks for reading the Roundup this week. As ever, be sure to check out the rest of the ShipCompliant blog for regular updates, and we’ll see you again in another couple weeks.

Regulatory News and Discussions

TTB Newsletter | This week’s top news includes an award presented to two of our managers in ALFD, a TTB Tip about how to use the information found on our application processing times pages, Permits Online will be down for system upgrade this weekend. TTB

TTB Slated Over Wine Labeling | Consumer advocates demand both calorie and nutritional information should be on wine labels. Wine-searcher.com

TTB Consignment Sales Investigations | What is behind the curtain of the TTB Press Releases? Booze Rules

North Carolina Brewers, Wholesalers Reach Franchise Law Reform Compromise | North Carolina craft brewers and wholesalers have reached a compromise in a contentious years-long dispute over the state’s self-distribution and franchise laws. Brewbound

Minnesota Winemakers Fight to Change Grape Laws | Two Minnesota wineries are continuing a push to change the law regarding how wine is made in the state. Fox 9

Al Gore Tells Wine Industry To Act on “Global Emergency” of Climate Change | Hundreds of wine industry representatives attended a climate change leadership conference in the city of Porto. Decanter

Industry Updates: Market Conditions and Developments

The Wine Industry Can and Should Be Doing More to Market to Gen X — And Everyone As a category of consumer packaged goods, wine is subject to how it is packaged and marketed and then to the whims of the buying public. Forbes

US Wine Exports Decline Over the Last 12 Months | U.S. wine exports have declined over the last year through December by 12 percent in volume and 5 percent in value, according to a recent report by bw166, a wine industry consulting group. Press Democrat

What We Ignore When We Toast the “Top Five” Women in Whiskey | By highlighting the success of women in whiskey, tech, politics or other male-dominated industries, Greene says, these breathless headlines risk devaluing individual achievements. VinePair

The Effects of Mandatory Wine Label Nutritional and Ingredient Information on Purchase Behavior | In recent years, there has been a lot of pressure on governments around the world to expand label requirements to alcoholic beverages, including wine. The Academic Wino

It’s Snowing in California Vineyards, and Winemakers Are Loving It | Snow is great for grapevines — as long as it doesn’t last into the spring. SF Chronicle

Digestif

Second Impressions Count | How wine delivery experiences shape customer preferences. ShipCompliant by Sovos

The Biggest Scam in Wine History | Thanks to its iconic logo that makes it immediately recognizable, the Armand de Brignac Champagne is known worldwide also under the name Ace of Spades. Forbes

A Counterfeit Expert’s Solution for Eliminating Fake Wines | How Maureen Downey is using blockchain technology to prevent fraud in the wine industry. SevenFifty Daily

Is There Terroir in Whisky? | The flavor of place, or terroir, comes up frequently in discussions of wine. But how to talk sensibly about terroir in whisky? Herald & Review

How Producers Dial in the Right Shade of Pink for Rosé | The timing of the harvest and winemaking adjustments are among the factors producers consider to achieve desired color intensity. SevenFifty Daily

 

Find out how ShipCompliant by Sovos can help your business stay on top of compliance by signing up for a free demo.

The post BevAlc Roundup | TTB Continues Consignment Sales Investigations, Wine Exports Drop in Last Year, and How to Beat Counterfeit Wines appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

Second Impressions Count: How Wine Delivery Experiences Shape Customer Preferences

Fri, 03/08/2019 - 14:26

In the world of wine, first impressions are incredibly important. Consumers’ perceptions can be swayed by a friendly greeting when they walk through the door, the layout and cleanliness of a tasting room, a website’s organization and ease of use, or the label of a bottle.

But when you consider the growing influence of ecommerce, it’s that second impression –delivery – that may ultimately make or break the customer experience. And yet, the delivery experience can feel out of your control. After a package leaves your winery or warehouse, how do you ensure delivery goes positively for your customer? A common challenge like failed delivery attempts could lead to damaged wine, for example, since temperature fluctuations can affect the product. Optimizing the delivery experience is critical.

Second-impression lessons from Amazon and Apple
Delivery challenges can be tough to solve, given that ecommerce sales show no signs of slowing. Ecommerce accounts for about 9 percent of total retail sales and is growing exponentially according to the U.S Census Bureau. Strategy&, PwC’s strategy consulting business, predicts that the number of packages delivered each year in the U.S. will grow from 11 billion in 2018 to more than 16 billion by 2020. This growth is directly affecting direct-to-consumer (DtC) wine shipments. In our 2019 Direct-to-Consumer Wine Shipping Report, we found that wineries shipped more than 6 million cases of wine in 2018, an increase of 9 percent from the previous year.

With the number of deliveries expected to increase, businesses like Amazon and Apple are redefining the delivery experience, and wineries must take note. As more and more packages are sent, wine deliveries must meet consumers’ demands to receive exactly what they want, exactly when, where and how they want it.

To ensure customers receive packages without problems, Amazon is adding secure neighborhood pick-up locations and testing delivery inside customers’ property. In addition, the company is installing lockers in more than 850,000 apartment buildings, as well as at Whole Foods and other brick-and-mortar stores, providing more flexibility around delivery times and minimizing the risk of stolen or damaged goods.

While Amazon has led the online sales revolution for everything from $1 packs of pencils and books to groceries and other necessities, high-end brands are slowly taking notice. However, these brands are taking Amazon’s efficiencies one step further by also delivering an unforgettable unboxing experience that will turn first-time buyers into loyal customers.

One company investing in the unboxing experience is Apple. The technology giant’s notable aesthetics flow from its technology products to stores and even touches its packaging. Design is so ingrained into the company that Apple even has an unboxing room where designers can experiment with packaging with the hopes of evoking the perfect emotional response from their customers. As Apple’s Jonathan Ive notes, “Packaging can be theater, it can create a story.” As such, Apple focuses its unboxing experience on getting people to the product they ordered fast – with easy open packages and putting the main product front and center – satisfying consumers need for quick gratification.

Expanding the second impression to wineries
One luxury product – wine – has more complexities around direct-to-consumer (DTC) sales, including state-specific regulatory requirements, age restrictions and fragile items that must be protected in transit. Yet the demand is growing.

Extending the white-glove treatment from the tasting room to customers’ homes can be hampered by many of the problems other retailers face. But ShipCompliant is helping wineries live up to the gold standard of delivery that Amazon and Apple have set. Our cloud-based platform enables wineries to personalize the shipping process, from proactively communicating with customers about delivery times or potential issues to allowing self-service re-routing to different locations, to partnerships with Commerce7 to make it easy to ship wine to Fed Ex Hold-at-Locations (HALs).

Wineries don’t have to suffer from a bad second impression as they expand their DTC sales. With an assist from ShipCompliant Delivery Experience tools, wineries can ensure great communications with their customers, and leverage analytics to improve delivery rates and customer satisfaction, which are vitala to generating repeat business and higher sales.

Find out how ShipCompliant by Sovos can help your business provide the luxury delivery experience that your customers want by signing up for a free demo.

 

Get your copy of the 2019 Direct-to-Consumer Wine Shipping Report today for comprehensive data and insights.

The post Second Impressions Count: How Wine Delivery Experiences Shape Customer Preferences appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

BevAlc Roundup | Oregon Set To Impose Wine Labeling Rules, Announcing FedEx’s Hold-at-Locations Services for Wine Shipments, and Whiskey Bottles Don’t Need Corks

Tue, 03/05/2019 - 16:16

March is here, and spring is right around the corner — at least, hopefully. It’s been mighty cold across the country recently, with lots of snow and cold rain to remind us that it’s definitely still winter. Until the weather warms up, at least there’s the Roundup to keep things hot!

This week we look at a bill to expand direct-to-consumer shipping of wine in Kentucky and how the state’s bourbon industry feels left out, the Silicon Valley Bank’s annual direct to consumer survey is open — something we recommend everyone to respond to — and scientists say that today’s beer might be tomorrow’s cannabis products.

In case you haven’t heard, the 2019 DtC Report has been published. Download your copy here.

Thanks for reading the Roundup this week. As ever, be sure to check out the rest of the ShipCompliant blog for regular updates, and we’ll see you again in another couple weeks.

Regulatory News and Discussions

TTB Newsletter | This week’s top news includes a reminder to use the correct address when mailing excise tax returns and payment to avoid potential penalties and interest, and we’ve added five new grape varieties to the list of names granted administrative approval for use on American wine. TTB

Wine vs. Bourbon | Kentucky distillers say the direct-to-consumer shipping bill that helps wine industry isn’t fair. WDRB

Oregon May Soon Tighten Its Wine Law for Wines Produced or Bottled in Other States | The proposed bill seeks to tighten the gap and to demand more transparency in wine labeling. On Reserve

Total Wine Loses Appeal to Overturn Connecticut Minimum Pricing Laws | The U.S. second circuit ruled in favor of Connecticut’s alcohol pricing laws, saying they did not violate antitrust laws set down by the 1890 Sherman Act. The Drinks Business

Senate Leader Kills Her Own Bill in an Hour | The measure, Senate Bill 127, would have prohibited out-of-state retailers from shipping alcohol to customers in New Mexico. Santa Fe New Mexican

New Legislation Filed After Report Suggests Ways to Modernize N.C. Alcohol Management | The findings showed that if North Carolina decided to change how it controls liquor sales, major modifications would be necessary, and would also have financial implications for state and local government revenues. Daily Tar Heel

Industry Updates: Market Conditions and Developments

FedEx Hold-at-Location Option and the Wine Industry | Delivery option at point-of-purchase may benefit wine sales and consumer retention. Wine Business

The SVB Annual Direct to Consumer Survey is Open | Today more than ever, the wine industry needs to be more strategic and proactive in its direct-to-consumer strategy and execution. SVB on Wine

Wineries Need Better Customer Experience | Producers need to maximize the visitor experience if they want to woo consumers. Wine-searcher.com

Downtown California Wine Country Tasting Rooms Help Rural Vintners Get Noticed | A recent report on the health of the premium wine business raised eyebrows with survey results that suggest smaller-scale vintners that have been relying on tasting rooms and clubs to drive direct-to-consumer sales growth should rethink that strategy. North Bay Business Journal

The Changing Face of Luxury Wine | What defines a “luxury” wine? A recent study investigates the relative desirability of thousands of wines. Wine-searcher.com

How the Wine Industry Can Capture the Attention of Generation X | In opinion pieces, the wine industry is chastised for failing to capture millennials’ attention and is offered advice on how to woo them back, and from outward appearances it seems that Gen X, currently aged 38 to 53 years old, are being ignored. Forbes

Digestif

Dear Whiskey Brands, Please Stop Using Corks | A columnist’s case for why whiskey bottles should never be sealed with a cork cap. The Daily Beast

The Lucky Break That Launched a Wine Revolution | If it wasn’t for White Zinfandel, we would not have these old Zinfandel vines to make delicious wines from today. Forbes

Scientists Brew Cannabis Using Hacked Beer Yeast | Researchers modify microbe to manufacture cannabis compounds including the psychoactive chemical THC. Nature

Why Some Distillers Are Creating Foraged Spirits | Among the benefits, wild ingredients infuse products with unique flavors and a sense of place. SevenFifty Daily

 

Find out how ShipCompliant by Sovos can help your business stay on top of compliance by signing up for a free demo.

The post BevAlc Roundup | Oregon Set To Impose Wine Labeling Rules, Announcing FedEx’s Hold-at-Locations Services for Wine Shipments, and Whiskey Bottles Don’t Need Corks appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

Direct-to-Consumer Wine Shipping Flourishes in Oregon, Sonoma County

Fri, 03/01/2019 - 08:05

Last month, we released our annual report with Wines Vines Analytics, offering a deep dive into the state of the direct-to-consumer (DtC) wine shipping industry. There’s a ton of interesting highlights, data points, and trends in the report – including which regions shipped the most wine in the DtC channel last year, which regions saw the most growth, and which failed to live up to expectations.

Overview: Sonoma and Oregon drive DtC channel growth

Napa County has traditionally been the dominant force in the DtC channel, but other regions have begun to close the gap in recent years. Finally, in 2018, Sonoma County overtook Napa in terms of the volume of wine shipped direct to consumers, while seeing impressive growth in the value of wine shipped, as well. Napa’s price per bottle shipped went up last year, which can explain its continued hold on the most value shipped, but it appears as though consumers may have been somewhat turned off by the high prices in this region.

Meanwhile, Oregon built on its impressive growth across the past seven years. In fact, it significantly outperformed the entire DtC shipping channel last year, increasing both the volume and the value of its wine shipped direct to consumers. This is certainly a region to watch over the next few years, as is its neighbor, Washington, which also outperformed the overall channel – sort of. But, more on that later.

Napa continued to grow modestly, but lost its grip on the market

Historically, Napa wineries have been the most consistent growth drivers in the DtC channel. But after years of fending off Sonoma wineries, Napa was at last unseated as the undisputed king of the channel. Despite this, the region saw some growth – a 2 percent uptick in volume shipped and a 9 percent increase in value – but these numbers fell well behind the DtC channel at large, which grew 8.9 percent and 11.6 percent, respectively. This explains how Sonoma was able to surpass Napa in volume shipped. Likewise, there would appear to be a simple explanation for the rather tepid growth in this region – prices went up 7 percent, and some consumers evidently balked at the increase, opting to take their business elsewhere.

Sonoma’s impressive growth culminated in its rise to the top

While the overall DtC channel saw 11.6 percent and 8.9 percent increases in volume and value, Sonoma wineries jumped up 19 percent and 18 percent in those categories. Those are impressive increases year-over-year, and they were perhaps spurred by a 1 percent decrease in price per bottle shipped. As Napa wines grew more expensive, Sonoma wines appeared to undercut them, at least to some extent. In fact, this appears to be indicative of a longer trend – since we began tracking this data in 2011, Sonoma wines have decreased in price by a whopping 17 percent.

Keep an eye on Oregon and Washington over the next few years

While they won’t pose challenges to Napa and Sonoma this year, Oregon and Washington are poised to become real players in the DtC channel in the long-term. Last year, Oregon saw its volume increase 19 percent and its value 21 percent; meanwhile, Washington saw upticks of 13 percent and 12 percent, respectively. Both states are outpacing the overall DtC market’s growth, and appear poised to keep it up over the next several years as Pinot Noir (Oregon’s top wine produced) and Rosé (a Washington specialty) remain nationally popular. In fact, Rosé shipments in Washington have doubled in share since 2011, jumping from 2 percent of the state’s shipping volume to 4 percent in 2018. As long as Rosé remains popular, Washington will continue to see growth.

 

Get your copy of the 2019 Direct-to-Consumer Wine Shipping Report today for the comprehensive data and insights.

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BevAlc Roundup | Craft Beverage and Modernization Act Part Deux, the Oregon Wine Symposium is a Success, and Zinfandel’s Curious History

Mon, 02/25/2019 - 09:20

For the Roundup this week we look at the slate of beverage alcohol bills before the California legislature in 2019, the DtC Report confirms Nielsen data showing strong growth in Oregon wines, and what the new face of whiskey drinkers is and why it’s a welcome change.

In case you haven’t heard, the 2019 DtC Report has been published! Download your copy today here.

Thanks for reading the RoundUp this week. As ever, be sure to check out the rest of the ShipCompliant blog for regular updates, and we’ll see you again soon.

Regulatory news and discussions

TTB Newsletter | This week’s top news includes that we have reopened the comment period for the proposed establishment of the West Sonoma Coast AVA, we’ve resolved 7 trade practice cases stemming on a 2018 joint TTB/California ABC investigation, and we’re providing information about how to use the Public COLA Registry. TTB

2019 Legislative Changes for California Alcohol Producers — A Blessing or a Curse? | It wouldn’t be a new year without new changes to the California ABC Act, making compliance an elusive target for even the most diligent licensees. Booze Rules

New Craft Beverage Modernization and Tax Reform Act Bill Introduced to Make Excise Tax Cuts Permanent | A bipartisan bill was introduced Wednesday in the U.S. Senate to make the alcohol excise tax cuts approved in 2017 permanent. Wine Business

Bill Stopping Wine Shipments to New Mexico Consumers Benefits Middlemen | The National Association of Wine Retailers (NAWR) has announced its opposition to, and astonishment with, a bill moving through the New Mexico legislature that would remove consumers’ right to receive wine shipments from out-of-state wine stores. NAWR

Poll: Majority Wants End to State’s Liquor Monopoly | An Elon University Poll finds 52 percent of North Carolinians contacted support closing the state’s Alcoholic Beverage Control system. Laurinburg Exchange

Wine Win Likely at the Supreme Court | US editor W. Blake Gray mulls over how the Supreme Court will come down in a crucial decision. wine-searcher.com

Industry updates: market conditions and developments

More Than 2,000 Wine Industry Professionals Attend Oregon Wine Symposium | The purpose of the Oregon Wine Symposium is to showcase the Oregon wine industry, which currently employs over 30,000 people, and generates over $5.6 billion dollars annually. Wine Business

Nielsen and ShipCompliant Reports Confirm Exceptional Consumer Demand for Oregon Wine | Oregon wine sales grew 12.4% in 2018, revealing a trajectory eight times the growth of wine nationally. Wine Industry Advisor

US Shutdown: “Long-Term Implications” for Spirits | The government shutdown in the US has had a troubling effect on drinks producers in the country and overseas. The Spirits Business

Craft Tax Cuts Big Business a Break | Billionaires got the biggest tax break under the Trump Administration, so it stands to reason that the nation’s biggest beer brewers and wineries also scored a huge tax cut in 2017 for the “craft beverages” they produce. Wine-searcher.com

Direct Sales Winners and Losers | Different attitudes to the DtC model are splitting the industry into different markets. wine-searcher.com

Digestif

The New Face of the Average Whiskey Drinker: Young, Pierced, and Female | Whiskey used to be the purview of grumpy old men. But hip young women have a new enthusiasm for single malts. Robb Report

Discovering the Origin of Zinfandel | The pursuit of an ancient vine material provides an avenue for cultural and technological exchange in wine–from Croatia to California. SevenFifty Daily

Why Breweries Are Opening Locations in Malls | Affordable real estate and ample foot traffic are just two factors attracting brewers to shipping centers. SevenFifty Daily

The Wines You Should Buy in 2019, According to Critic Robert Parker | We’re living in a Golden Age of Wine. Let’s raise our glass to the good stuff. Robb Report

 

Find out how ShipCompliant by Sovos can help your business stay on top of compliance by signing up for a free demo.

The post BevAlc Roundup | Craft Beverage and Modernization Act Part Deux, the Oregon Wine Symposium is a Success, and Zinfandel’s Curious History appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

ShipCompliant Partnership with Commerce7 Enables Wine Shipments to FedEx HALs

Thu, 02/21/2019 - 13:48

ShipCompliant by Sovos today announced support of what will become a new industry standard: shipping wine directly to FedEx Hold-at-Locations (HAL).

With consumers expecting speed and convenience for their deliveries, and wine having many compliance requirements, FedEx HAL is an alternative delivery option for winery customers who prefer not to have packages shipped to their home or work addresses. HAL offers wineries’ customers more than 11,000 locations nationwide from which to pick up their wine shipments any time it’s convenient for them, offering a solution to failed delivery attempts and returns that can otherwise occur. This service ultimately gives customers a better wine delivery experience, and saves time and money.  

Commerce7 and ShipCompliant by Sovos have partnered to populate HAL options at website checkout. This allows wineries to provide a new level of delivery experience for their customers with confidence that they are in compliance with the complex direct-to-consumer wine shipping regulations.

“At Commerce7, we are focused on creating better customer experiences, and FedEx Hold at Locations is one of those experiences. We are excited to work with ShipCompliant by Sovos in bringing a compliant FedEx HAL program to our clients,” said Andrew Kamphuis, president, Commerce7.

Larry Cormier, general manager at ShipCompliant by Sovos, said, “The delivery experience is key to customer retention and revenue growth for ShipCompliant’s DtC customers. Partnering with Commerce7 and FedEx to seamlessly integrate HAL into the order processes is a perfect example of our commitment to innovation and customer success.”

This functionality is open to any integrated, front-end partner of Sovos’ ShipCompliant platform.

To learn more about how FedEx HAL can transform your customer’s experience, join us for a free webinar on March 13, 2019 at 10 a.m. PT/ 1 p.m. ET. Register here.

 

 

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How to Expand Your Winery’s Footprint: Distribution Rules and Market Conditions

Wed, 02/13/2019 - 13:30

Wine consumption in the United States has skyrocketed since the 1990s, and wineries have increased their production and distribution footprints to keep up with the demand. Expanding your footprint can create logistical and regulatory challenges for any business, but this is especially true in a heavily regulated industry like the beverage alcohol space. There are many unique obstacles facing wineries as they branch out and distribute their products in new regions

However, this has not presented an insurmountable barrier to growth – last year’s State of the Wine Industry 2018 report by the Silicon Valley Bank Wine Division showed that the volume of wine consumption in the U.S. has more than doubled since 1993, growing from 370 million gallons to 770 million gallons. Clearly, there is opportunity to be seized for U.S. wineries. But is your winery fully prepared for the rigorous process of licensing, distribution, logistics and compliance with federal, state and local laws?

ShipCompliant can help you navigate the tricky regulatory landscape with our guide for wine producers: 10 Key Steps to Expanding Your Winery’s Footprint.

Understand your own ability to comply with wine distribution laws

Every state – and many local jurisdictions – have their own unique registration processes, compliance obligations and tax rates. Because of this, expanding and distributing your products compliantly can be even more complicated than it may appear on the surface.

Before you debut a new wine product or start targeting a new region, assess your internal resources. The size of your team, the knowledge you have about compliance across multiple areas, and the finances you have allocated to address it are all key components of the evaluation process.

Registering products in new jurisdictions can be expensive and time consuming. If you spend too much time or money putting out a series of fires during registration because you weren’t fully prepared to handle it, you may end up hindering your own growth. It’s important to have a fully fledged plan in place and a complete understanding of requirements in each new area you intend to sell into before you attempt to expand.

Research the market(s) where you intend to distribute wine

Ensuring you are compliant is a big first step when expanding your footprint, but it’s also crucial to have a comprehensive read on the state of the market. Trends may pop up at different times in different areas, in terms of both production and consumption. For example, Oregon wineries tend to produce a lot of Pinot Noirs – for more on that, check out our 2019 Direct-to-Consumer Wine Shipping Report – while Napa County has traditionally been known for its Cabernet Sauvignons. But Rosé has been a huge gainer in the wine market in recent years. It may be more worthwhile for your winery to explore that route, rather than trying to crack into a long-established market like Pinot Noir or Cabernet. You should also think of the ways you can diversify your wines from those that are already selling well in the areas you’re looking to enter.

 

For more tips on growing your winery’s products and reach, download our 10 Key Steps to Expanding Your Winery’s Footprint.

 

The post How to Expand Your Winery’s Footprint: Distribution Rules and Market Conditions appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

Economic Nexus In the Nation’s Capital

Fri, 02/08/2019 - 16:13

The District of Columbia has announced it will require non-local businesses to collect and remit sales tax on sales they make to D.C. residents. The District is joining with a number of states that have established what is being called “economic nexus” following the decision by the U.S. Supreme Court last year to relax restrictions on when a tax authority can impose tax obligations on non-local businesses.

This will likely impact the direct-to-consumer (DtC) wine market, as previously, wineries making DtC sales to D.C. that did not have a physical presence there were not obligated to pay sales taxes to the District.

D.C. first announced its intention to establish economic nexus last October in a public hearing; this was later approved by the D.C. Council, and finally signed by the D.C. Mayor in January.

Under the terms of D.C.’s economic nexus rules, all remote businesses selling to D.C. residents will be required to collect and remit D.C. sales tax if they:

  1. Have annual gross revenue of sales in the District that exceed $100,000; or
  2. Make 200 or separate transactions to the District in a 12-month period.

While these rules were only signed in late January, they are being applied retroactively to all sales made after January 1, 2019. Anyone who met the sales or transactional threshold last year will need to collect and remit tax on sales after January 1.

D.C.’s filing frequency depends on how great of a tax liability a business has in a given period: for a liability of $200 or less per period, file annually; for a liability of $201-$1,200 per period, file quarterly; and if the liability is greater than $1,200 per period, monthly filings are required.

The standard sales tax rate in the District of Columbia is 6 percent, meaning any swag or merchandise you sell to a D.C. resident is properly taxed at this rate. However, the sale of off-premises alcohol (meaning alcohol sold outside of a restaurant setting) is taxed at the special rate of 10.25 percent. This special rate applies to the sale of DtC wine.

In addition, starting on April 1, 2019, any marketplace provider (think of an online bazaar, like eBay or Etsy, that facilitates retailers but does not sell products itself) will need to collect and remit sales tax on behalf of its users.

Because the District of Columbia is a federally administered region of the U.S., new rules and regulations proffered by its Council must also go through a 30-day review by the U.S. Congress before it can become effective. As such, there is the possibility Congress will reject D.C.’s economic nexus rules in the weeks to come. It is unknown how likely such a rejection would be — in fact it’s rather rare for Congress to object to D.C. policies — but it provides an interesting opportunity for different state representatives to hash out their support or objections to economic nexus rules (for instance, legislators from states like New Hampshire, which do not have sales tax, have been vocally opposed to expanding nexus obligations).

Wineries making DtC sales to D.C. residents should take note of this rule change and review the amount of sales they are making to the District. If they exceed either of the thresholds above, they will need to begin collecting and remitting sales tax. Wineries should also note that D.C. applies a tax rate of 10.25 percent for all sales of off-premises consumption alcohol, rather than the standard 6 percent rate for general merchandise. Since DtC sales of wine would be considered off-premises sales, the 10.25 percent rate would apply.

ShipCompliant users will be able to receive the proper tax rates for both their wine sales and any general merchandise they sell to D.C., along with the necessary tax returns.

With D.C. adding economic nexus rules, the number of states where DtC wine shippers do not have a sales tax obligation is dwindling. Currently, only a handful of states either do not require DtC licensees to become sales tax collectors or have economic nexus rules. However, it is likely these states will follow what is happening across the country and add economic nexus rules in the future. As such developments happen, we will keep you informed.

 

Find out how ShipCompliant by Sovos can help your business stay on top of compliance by signing up for a free demo.

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BevAlc Roundup | Release The 2019 DtC Report! California’s New Rules for Social Media and Bev Alc, Where DtC Shipping Is Still Limited, and What Emerging Wine Regions Need to Overcome

Mon, 02/04/2019 - 10:11

In case you missed it, the 2019 Direct-to-Consumer Wine Shipping Report was released this last week! This annual report is the most comprehensive look at the DtC wine shipping industry, and provides valuable insights on how the industry succeeds and where future growth can come from. The headline number is that the market reached the $3 billion mark in 2018 for the first time — and while growth may have slowed from previous years, this is still undoubtedly an active and exciting market to be in.

Download your copy today here! Read more below on what the industry is finding in the report.

And after you’re done reading the Report, there’s plenty more of the RoundUp to check out, where we review the fallout from the Federal Government Shutdown on the TTB and the beverage alcohol industry; then we hear from Rob McMillan on whether consumers will still drink wine in years to come, and from Tom Wark on why that panic may be overblown; and finally, a look at why glass bottle recycling isn’t more common.

Thanks for reading the RoundUp this week. As ever, be sure to check out the rest of the ShipCompliant blog for regular updates, and we’ll see you again in another couple weeks!

 

The 2019 DtC Report Is Available — Here’s the Scuttlebutt

Wine Shipments to Consumers Hit Record $3 Billion in 2018 | 2019 Direct-to-Consumer Wine Shipping Report highlights growth in prices, leading to 50% growth in value in three years. ShipCompliant by Sovos

10% of U.S. Wine Retail Sales Shipped Direct to Consumers in 2018 | At $3 billion, DtC was up almost 12% over 2017 — 53% since 2015 and 6 times larger than 2011. Forbes

Direct Sales Alter US Wine Market | Direct to consumer sales up to $3 billion, spelling big change for the US wine industry model. Wine-searcher.com

DTC Channel Is Reaching Maturity for Wine | Larry Cormier, General Manager, ShipCompliant by Sovos, presented the topline results from their annual Direct to Consumer Wine Shipping Report based on the 8 million transactions a year filtered through ShipCompliant by Sovos at the DTC Wine Symposium Wednesday. Wine Industry Advisor

The Oregon Wine Industry’s Direct Shipping Success Story | Overall in 2018, all American wineries increased the volume and value of their DTC shipments by 8.9% and 11.6 percent, respectively. Oregon wineries increased their volume and value of shipments by 19% and 21%. Fermentation

 

Regulatory News and Discussions

TTB Message to Industry and Others Affected By the Shutdown | We have received a number of questions regarding how we plan to address the significant backlog of applications and other work items we now have following the shutdown, including how long it will take us to resume normal operations. TTB

The Government Shutdown Is Over (For Now), but the Hits Keep Coming | The TTB’s closure will cost the drink industry millions in the months to come. SevenFifty Daily

A Picture (On Instagram) Is Worth A Thousand Words | California’s new events-based tied house exception and why everyone is so excited. Booze Rules

Montgomery County Liquor Exec Fires Back at Group’s Call to Exit Alcohol Business | Monopoly on distribution and sales has been debated for decades. Bethesda Magazine

 

Industry Updates: Market Conditions and Developments

DTC Report Card: Progress Continues but State Laws Still Limit Consumer Access | “It’s baby steps sometimes,” Steve Gross, vice president, State Relations for Wine Institute, said Thursday at the 2019 Direct to Consumer Wine Symposium in Concord. Wine Business

The Lost Wine Consumer of 2019 | The industry isn’t only at a crossroads, we stand a chance of losing the wine consumer altogether. SVB on Wine

How to Fix the Problem With Millennials and Wine | The narrative surrounding Millennials and wine has changed, and now appears to present an existential threat to the American wine industry’s profits. Fermentation

The Top 10 Wine Trends of 2018 | From emerging wine regions to canned wines taking off, here are the top trends and news stories that most impacted the industry in 2018. Wine Enthusiast

Unified Symposium Tech Talk | Understanding and leveraging data within the wine industry. Wine Business

 

Digestif

Why Don’t We Recycle More Wine Bottles? | Wine bottles are a major source of domestic glass trash, why don’t we recycle them? Go San Angelo

Whiskey Searches Catch Up to Wine | A delve into our states for the most searched for wines reveals some surprising interlopers. Wine-searcher.com

Obstacles Emerging Wine Regions Must Overcome | Market perception is only one f the obstacles faced by winemakers in an emerging region: there are also issues posed by terroir, regulation, infrastructure, and more. Forbes

How an Enslaved Distiller Was Written Out of Jack Daniel’s History | Uncovering the true story of a legendary American brand. The Atlantic

 

Find out how ShipCompliant by Sovos can help your business stay on top of compliance by signing up for a free demo.

The post BevAlc Roundup | Release The 2019 DtC Report! California’s New Rules for Social Media and Bev Alc, Where DtC Shipping Is Still Limited, and What Emerging Wine Regions Need to Overcome appeared first on ShipCompliant | The software leader of the beverage alcohol industry.

The Highlights and Methodology of the 2019 Direct-to-Consumer Wine Shipping Report

Wed, 01/30/2019 - 11:07

Last week, we released the 2019 Direct-to-Consumer (DtC) Wine Shipping Report with our partners over at Wines Vines Analytics. This is the ninth edition of the annual DtC report, which features exclusive data and insights on the state of the industry, and has been a trusted source for wineries looking to ship their products DtC.

The current report looks at data aggregated in 2018, and provides the most accurate look at the state of the market – including varietal trends, hot shipping destinations, production by region, and more. In last year’s report, we correctly predicted that the DtC channel would top $3 billion in 2018 and that Sonoma County would overtake Napa County as the largest source of DtC wine shipments.

 

How is the report created?

Wines Vines Analytics created a custom, proprietary algorithm that uses its database of U.S. wineries. Their database comprises 9,997 wineries, some holding multiple licenses. This algorithm has been trusted by the industry for nearly a decade to provide the most accurate DTC data available.

The algorithm extrapolates DtC shipments from all transactions filtered through the ShipCompliant by Sovos system in a given year. The ShipCompliant by Sovos platform processes nearly 80% of the volume of the DtC channel, or roughly 8 million individual transactions. Our report includes data for shipments to all 45 states that allowed some kind of shipping of wine in 2018. These include even states like Arkansas and Rhode Island whose DtC regulations may not yet meet the ideal system that most other states have adopted.

 

Highlights from the report

The DtC report has lots of important data to unpack, and you can look forward to a number of blogs doing exactly that over the next several months. The following are some of the more notable takeaways from a broad industry viewpoint.

  • Consumers are splurging on wine: Wine drinkers apparently decided to treat themselves in 2018, as the average price per bottle shipped increased by the largest margin since we began producing the report. In addition, people bought more high-end wines in the DtC channel, with wines priced at $100 or more increasing 18 percent in volume.
  • Oregon outpaced the market yet again: Oregon wineries have increased their DtC shipments dramatically since we began tracking this data, and 2018 was no exception. For the seventh straight year, Oregon wineries outpaced the rest of the market in terms of volume growth, with an uptick of 19 percent compared to 8.9 percent overall.
  • Rosé on the risé: When we began producing the DtC report, Rosé was the least popular wine we tracked. What a difference (nearly) a decade makes! As a result of continuous year-over-year growth, Rosé has skyrocketed up to eighth, and saw a 24 percent increase in volume coupled with a 29 percent increase in value last year.
  • Napa’s prices limit its growth: Long the leader of wine production, Napa County hit a bit of a stumbling block in the DtC channel in 2018. While still seeing some modest growth – a 1.6 uptick in volume of shipments – the region trailed the rest of the channel’s growth. On the flip side, the price per bottle shipped in Napa jumped up 23 percent. These price increases could prove to be a reason why Napa underperformed relative to the market.
  • DtC shipments maintained their market share: Winery direct shipments accounted for 10 percent of all off-premise domestic wine retail sales, which equaled the 2017 share. Overall, total domestic off-premise wine sales reached $29.7 billion in 2018.

Be on the lookout for more blogs detailing the data and trends we identified in this year’s report. And make sure to download your copy of the 2019 Direct-to-Consumer Wine Shipping report.

 

 

Learn more about the state of the DtC wine shipping channel by downloading the full report.

 

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