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August 05, 2008

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el jefe

hi Mike - There's a local meeting with an Amazon rep at 10AM tomorrow. If I can get out of jury duty today, I get to go! Wish me luck!

I have an email from NVL offering a new fulfillment service to 45 states with full compliance services. If Amazon is using NVL, and NVL is able to ship to 45 states now, then Amazon will give me direct consumer access to states I can't afford to access now. If that is the case, and I get paid FOB (or close enough) this would appear to be a great deal for any small winery.

Assume the best and I will report back tomorrow ;)

el jefe

OK, so I am reporting back Sunday (just back from a very successful two-day tasting event with the TAPAS organization.)

Pretty much everything has been covered by other comments in the several posts on this. They are going for smaller wineries, and the wines will sell for a minimum of $12. The winery commits to selling the wine, Amazon comes and picks up the wine and deals with everything else - including compliance paperwork, shipping problems, etc.

Fans of the Amazon Prime program will be pleased to know that Prime will also apply to wine shipping - and only a two-bottle minumum order!

It won't be 45 states but rather 27 states in the initial rollout. One possible barrier to entry for some wineries is that the winery must pay all regulatory fees for label registration in those 27 states (Amazon estimates that to be about $400 per label.) That is a startup cost and the yearly renewals will be less. Amazon does the paperwork. Note also that if a winery is already registered in a state, another registration must be done since it is a new 3-tier path. And, a winery must commit to all states that Amazon will ship to - you can't pick and choose states.

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