New Vine Logistics Closure Forces Wineries to Scramble for Logistics Services
The abrupt closure of New Vine Logistics due to “financial crisis,” as reported by WineBusiness.com today, begins a new chapter in how wineries will fulfill direct sales to consumers. The several hundred wineries currently using New Vine Logistics must, at a minimum, scramble to service their winery direct orders without interruption. If these wineries are unable to easily access limited production wines already stored at the New Vine facility, this may prove to be a particularly difficult challenge. The wineries that are fortunate enough to use other methods of fulfillment for their direct orders should make sure they fully understand the implications of this event for their business as well.
The New Vine story provides a link to the article “Getting Wine to the Consumer,” which offers a non-comprehensive list of logistics service providers, classified as Consolidation/Logistics companies, Transportation companies, Case Goods Warehouses, Fulfillment Houses, and Common Carriers. Another link to the related article “How to Select a Third Party Fulfillment Center,” provides additional information on logistics choices that need to be made in the wine business. These articles offer a good start in the process of thinking through an optimal wine logistics strategy.
The message for all wineries is not to take logistics for granted. Working through the complexities of what to do in-house and what to outsource, let alone which companies to use for outsourced services, requires significant expertise. The first task for wineries is to determine whether they have adequate expertise to make these critical business decisions alone. If they do not, then deciding where to get help in evaluating logistical alternatives is critical. Many elements are involved in running a successful direct to consumer shipping operation, including allocating available product, picking and packing accurately, billing, complying with a myriad of state regulations, financial and regulatory reporting, timeliness, and cost.
Poorly thought through fulfillment can have significant impact on a winery’s sales, profitability, and customer satisfaction. Making the appropriate decisions and investment, in addition to picking the best business partners, should not be taken lightly. The wineries that heed the “wakeup call” and take the appropriate steps to ensure that their logistics strategies are appropriate for their business will be more successful than those who ignore this event and just continue with business as usual.
