Amazon suspends wine sales effort

Amazon.com is apparently shelving its planned effort to sell wine online.

A little more than a year after word of the effort trickled out, a senior Amazon account manager told wineries about the decision to cork it in an e-mail last week.

"As you know, we were excited to work with you to build the AmazonWine business," Dini Rao said in an e-mail first reported by WineBusiness.com. "For that reason, this was a very tough choice for us. Many of you took the time and leap of faith to really support us."

Amazon representatives did not immediately respond to requests for comment.

Word of the effort leaked out in September 2008 when a nonprofit vintner group announced it had partnered with Amazon to drum up interest from its members to sell wine through the retail giant. However, its fulfillment partner New Vine Logistics briefly suspended operations this summer before securing additional financing from Inertia Beverage Group.

Since the Supreme Court ruled in May 2005 that states must grant the same shipping rights to out-of-state and in-state wineries, winery-to-consumer shipping has become legal in 35 states, according to wine advocacy group Free the Grapes. But state laws governing direct wine shipping vary greatly, creating an onerous task in managing compliance.

Amazon had dabbled in the wine business before, investing $30 million for a 45 percent share in Wineshopper.com in 1999, a start-up that was acquired by Wine.com in 2000 before going through a series of layoffs. Wine.com has a storefront on Amazon, through which it sells gourmet food baskets but not wine.

[sshappyjack]

So is Amazon suspending wine sales due to lack of sales or because shipping compliance is onerous? Did they advertise this much? I buy wine, and I shop at Amazon, but it never occurred to me to search for wine on Amazon.

[kswartz26]

They shelved the "planned effort". They were working on it, but never launched it.

[jaguar717]

There never were any sales.

The crushing weight of government strikes again, making another productive venture impossible and making us all just a little bit worse off.

[sshappyjack]

kswartz26 : You are right. Somehow I missed the first sentence. When I first read the article I'm pretty sure it quoted an amazon exec as saying something like "wine shipping is not going to be resumed" which made me think that they had already shipped wine at some point in time.

[mrobmsu]

A $30 million investment is dabbling??? I know Amazon makes a lot of money, but when did 30 mil become "dabbling"?!?!? C'mon.

[mediocrates--2008]

Amazon's gross profit last year was 4.3 billion, or just about half a million dollars per hour. $30 million seems like dabbling to me. What's the problem?

[krosafcheg]

That was forever ago, 30 mil was a tip at most restaurants...