Issue link: http://winesandvines.uberflip.com/i/953481
2 0 1 8 2019 422 © 2019 Wines & Vines Directory BY USING THE WINES & VINES DIRECTORY/BUYER'S GUIDE, YOU AGREE TO NOT REPRODUCE, DUPLICATE, COPY, SELL OR RESELL FOR ANY PURPOSE. 422 © 2019 Wines & Vines Directory BY USING THE WINES & VINES DIRECTORY/BUYER'S GUIDE, YOU AGREE TO NOT REPRODUCE, DUPLICATE, COPY, SELL OR RESELL FOR ANY PURPOSE. DIRECT SHIPPING REGULATIONS ANNUAL SHIPPING REORT Political and Regulatory Trends e big news for 2018 in terms of DtC shipping of wine was the opening of Oklahoma on October 1. ere are now 45 states that permit the DtC shipping of wine, with the remaining holdouts looking increasingly isolated. But there were other major developments coming from the courts in 2018. Not specific to the DtC wine market, the U.S. Supreme Court in June ruled that states can impose sales tax obligations on out-of-state retailers; while DtC wine shippers largely already have to pay sales taxes, there are a few states where this could have an impact. But if nothing else, this shows a general trend in how courts view e-commerce. e issue of retailers making DtC shipments arose consistently in 2018, with several states facing litigation. e issue may come to a head in the current Supreme Court session when the Court review the legitimacy of Tennessee's residency requirement for liquor stores. How things will ultimately be resolved is currently unclear, but the potential for major changes hangs in the air. Commercial Trends e DtC wine market's yearly growth continued apace in 2018. Mid-year reports showed that the market had already reached $3 billion in year-on-year sales. While the opening of Oklahoma to the market will no doubt bring some rise in sales, most of this growth has come from organic expansion in existing markets — though there are still reverberations from Pennsylvania opening in 2016. Consumers of all products are increasingly looking for ease in purchasing, and they appreciate the opportunity to speak directly with producers. ese are trends that wineries must take advantage of if they want to experience some of the DtC wine market's growth for themselves. e broader e-commerce market provides ample lessons for wineries to learn from, as they continue to grow the valuable DtC wine market Stable Growth Amid Regulatory Flux It is impossible for anyone to argue against the success of the direct-to-consumer (DtC) wine market. Over the many years that Wines & Vines and ShipCompliant by Sovos have tracked this market for the annual Direct Shipping Report, the trend has been that of consistent and considerable growth. But underneath this success is a regulatory environment struggling to adapt to a rapidly evolving retail environment. In the wine industry, new entities, such as modern tasting rooms that double as sales rooms, delivery services, and online marketers have upset decades-old notions about who should be regulated and how. is parallels changes to the broader economy, where the rise of e-commerce has similarly forced states to readjust their regulatory systems. e DtC wine market's current size makes it more resilient to regulatory changes, but it's certainly not immune. As governments act to adapt their rules to the modern economy, it will be critical for wineries to not only ensure that they are capable of meeting the new requirements, but also to be part of the conversation to help develop a system that enables continued growth of the increasingly important DtC wine market. DIRECT SHIPPING REGULATIONS ANNUAL SHIPPING REPORT