Inertia on the Move

Software program opens direct-to-trade channel for small producers
 
 
Napa, Calif. -- Although still in its Beta incarnation, Inertia Beverage's WineREvolution is already proving itself with small-production wineries across the continent by linking them directly to retailers and restaurants in 12 states representing more than 50% of the U.S. wine marketplace. Inertia's direct-to-trade (DTT) technology, which was developed over several years, meets a need on both ends of the supply chain, enlarging the market for small wineries that typically don't have access to major distributors, and providing restaurants and specialty retailers with desirable products that aren't seen on most wine lists or on supermarket shelves.

WineREvolution.com currently lists more than 60 brands and 300 SKUs. These are available to buyers in eligible states, who can register their licenses to see wholesale prices (including delivery costs) for quantities of six bottles to multiple pallets. The wine is purchased directly from the winery, with Inertia serving as marketing agent and taking a 5% commission on each purchase.

In some states, it's still necessary for the wine to pass through a distributor for paperwork and tax purposes, but in the states served by WineREvolution, the distributor does not need to physically take possession of the wine. Inertia works directly with the states to access liquor license databases and maintain compliance. The program now is selling in Arizona, California, Connecticut, District of Columbia, Florida, Illinois, New York, Ohio, Oregon, Vermont, Washington and Wyoming, and Inertia is working to open access in 10 more states in the near future.

Purchases are typically made with a credit card, eliminating the need for invoicing. Electronic check processing is expected to be available soon.
 
 
Tudor's Santa Lucia Highlands Pinot Noir, $39 retail, is one of many high-end bottles available direct-to-trade through WineREvolution.Tudor Wines is a bonded winery based in Santa Barbara, Calif., that produces under 5,000 cases per year of high-end wines sourced mainly from the Central Coast and Mendocino's Anderson Valley; and a second, mid-tier brand called Radog. Winemaker Dan Tudor, a longtime client of Inertia Beverage, was among the first to sign on to WineREvolution, and has listed all his wines.

"It's a great alternative," he told Wines & Vines. "This channel is great for small production wines, for restaurants and small wine shops that don't want wines that are available everywhere, and even for small distributors. There is an opportunity to partner with Inertia and not have to do any warehousing, restocking: only take the orders."

Tudor has already shipped wine to destinations in New York, Arizona and California. "Just yesterday, we got an order from Washington," he said. "The largest was a pallet of our Radog Pinot Noir that we sent to New York." Tudor explained that in a couple of markets, he and Inertia are working through brokers, which take a standard broker fee, usually 10%. "Inertia found one, and I found one in Washington," he said.

Inertia is not limiting its participation in the partnership to the virtual world. Tom Wark, executive director of Specialty Wine Retailers, and indefatigable promoter of DTT sales, was instrumental in setting up the WineREvolution. Wark told Wines & Vines that Inertia is physically going into the markets it serves, hosting trade tastings to introduce its portfolio.

Tudor commented that, "In a lot of cases, the distributor (in this case, Inertia) initially needs to make that contact, establish that relationship, meet the client and pour the first wine. Once you get that wine in someone's glass," though, re-ordering is much simpler through this channel. "If you run the numbers," he said, "It makes more sense all around. The broker doesn't have to go around every time someone wants an order."

"It's a virtual distribution system," Wark said. "It has never existed before, but technology now makes it possible."