“Disruptive” is a term that raises my hackles. This is due to it being used either when referring to something like Uber who are outright breaking the law or then someone who is claiming to do something new that isn’t possible. Winebuyers.com appears to be the latter.
I wasn’t even aware of this website until I read this interview where I could see that the big focus was on the age-old premise of “cutting out the middle man”. All well and good and as shown in the case of Amazon.com and book stores, it can indeed be “disruptive”. There are however several ideas that don’t fly in this concept.
For starters, I’ve seen many websites attempt this exact same premise of charging wineries for a listing to then sell directly to the consumer. In fact there were a great many of these that started up in Spain in the Post Crisis Era which were borderline scams as they did nothing except have a wine listing on a website in the ether of the internet. In fact, there was one that was specializing in Catalan products who asked me to list my books which I didn’t even bother responding to. Why? Search for “Priorat wine book” and you’ll see why I’d not want to pay for a listing somewhere when my book is the first result. If you don’t know that when propositioning someone with a sales opportunity, then you don’t know what you’re doing.
Books are one thing and wine is another however and all these sites that started don’t work for several reasons. The biggest one is shipping. This is one of the most aggravating aspects to ordering wine online is that the shipping costs can be more than the wine, especially when buying just a few bottles and they just keep going up. It works well for larger enterprises like wine.com, uvinum.com, vinissimus.com, vinexus.de, etc. because they entice you to order in batches of at least six to save on shipping. Thus they sell more wine, you get it for less shipping, and all are happy. But, they physically stock the wines, they aren’t pulling this “oh, we’re just a conduit” thing that winebuyers.com is claiming.
The second big issue is the legal one of bringing wine–which is classified as a form of alcohol mind you–into a country. If the shipping costs don’t kill you, then that will as it’s an additional cost. Then you have to take into account that countries such as the US who have individual states that don’t allow shipping and for a wine to be imported, its label needs to be in the ATF’s database. And, as of mid-2017, you can’t even ship wine directly to yourself and you need to use an importer to forward it on to you. Yes, that “middle man” that was so desired to be cut out has a use it turns out. Somehow all this will be taken on by the wineries who are paying to be listed on this website.
This is the reality of sending wine and winebuyers.com attempt at being “disruptive” addresses none of it. Ben Revell claims that there has “…been great progress in the field of logistics and transport that has helped this business model to become a reality…” but those are just meaningless words like “revolving opportunities to drive synergy and positive outcomes” and if you know the wine trade, you know the cold hard truth. Sure, they may get some people signing up and they may get some wineries listing there, but there’s no way it will succeed in its current form as there is a heaving chasm of reality that’s not being bridged between winery and consumer.
The fact that they’ve raised £1 million in funding means nothing as there are impossibilities which have been conveniently ignored. Now, what they could be doing is something that isn’t what they claim to be doing at all and maybe they’re actually aware that this model won’t work. In the process, they’re potentially collecting a great amount of wine drinker data as well as winery data and that could potentially be worth a great deal. This is something to keep in mind if you sign up: “we’re collecting data from our users and developing a tool which will enable us to offer suggestions based on consumer preference”.
Would this data be worth more than all the data that wine-searcher.com has? Who knows but data about wine types is the only aspect of this that I see taking flight as this premise of being a conduit for wine sales is soooo 2008.
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There is one online wine club that seems to work quite well, and that is 1jour1vin. They do get direct access to the estates that they work with, and, a bit surprisingly, they do a remarkable job at ensuring proper transport as well as the correct fiscal treatment to the destination country, at least for Belgium and the Netherlands. It is overly ambitious to claim that this can be done on a global scale though, and all the usual startup bla bla bla is not exactly confidence-inspiring.
Wineissocial.com does a pretty decent job in Spain but again, they’re warehousing the wines, not having them sent from the shipper. I have to assume the site you’re referring to does some degree of the paperwork as there’s no way to just be a “conduit” and have this work. An order I placed with uvinum.com, despite the fact it’s coming from another provider, they handled all the customer service. So at best this winebuyers.com is exaggerating their claims and at worse, it’s fraud.
As it would have diluted the article I didn’t even get into the fact that their selection isn’t as great as they make it out to be. One of the main providers if you search in Cataluny is Torres. Fine family and good wines, but a very big producer you can find literally in every corner of the world. Nothing niche about that!
I think that there is no easy way to fully work as a conduit, because it would mean relying on all your supplying wine producers to ship correctly and in a uniform manner. Also would be very difficult to make it work it you order from ten different producers. It is surprising that they managed to raise some serious funding already, but like so many online wine initiatives, I would not be surprised to see it gone in a couple of years.
Nicely written article, but poorly researched. I hadn’t heard of this website either, you make a lot of points but it doesn’t look as though you’ve checked any of them? If you look on their website it looks as though you select your country at the top of the website (like a lot of other sites) and it adjusts showing stock that can be delivered to that country, I would assume the calculators in place then on shipping are pretty straight forward. I would also agree with the comments about transport and logistics improving which helps the model. I know a lot of wineries that didn’t ship at all 5 years ago but now do and successfully so.
Your concerns are valid, but a quick browse across their site seems to answer them. To accuse them of fraud is a bit of a stretch.
Firstly this article was written three months ago so it was based upon the information at hand then. But, I’ve searched again and the inventory is much the same. Some producers have left, others have come on board although there is nothing that’s really “exclusive”. For instance they have Pazo Señorans from Rías Baixas which is a fine example of Albariño, but very much widely-available.
You’ve accused me of not doing research and I’m more than happy to concede when I’m mistaken or the facts at hand are out of date but I’ve run the searches again both being logged in with a country selected and being logged out and the selection is exactly the same. So, you’ve erred in your assumption.
As for accusing them of fraud, I’ve done no such thing in the article. In a comment to a reader after the article, I’ve raised the issue that it’s a worst case scenario as they’ve grossly overstated what they can do. Depending upon the context and what transactions occur, this can potentially be fraudulent activity but it’s a case that remains to be proven.
More than likely the site will hang around for some time and then silently drift away when winemakers see it isn’t a cure all to the age-old issue of how to connect with consumers as no, the logistics issues have not improved at all, especially with the US which is the biggest wine market in the world. And then there’s shipping to China which is slated to become the second largest market soon. If you can’t ship directly to at least 1/3 of the planet, then you can’t really pull off what you’re claiming.
Ok. I’m not sure you can say the inventory is ‘much the same’ either, they’re claiming the website is dynamic and has near 30,000 bottles from a number of people so I would assume it changes daily. In a similar vein picking one bottle out and saying – therefore the website is offering widely-available products is a mute point.
Sorry to go back to the shipping again and perhaps i’m mistaken but I’ve just looked at their ‘wine of the week’ for example some awful prosecco. I’m based in the US and it says the item cannot be delivered to this country, when I change the location to London (where they are based) it shows the delivery price, after a few more checks it does look as though some of the sellers ship to different places which seems logical?
As I said it’s a very well written article but it is a scathing review of a company which looks as though its at least trying to solve issue other companies have ignored for years and your two arguments being shipping and importing I think have at least been addressed.
Have you actually bought something from their website? Did it work? How do you know some producers have left?
If you have ordered wine from France to delivery to the Uk, a duty has to pay £2.15 per bottle of wine if this not paid the the considered smuggling