WineDepot helps struggling wineries

With alarming reports that one-third of Australian wineries could go under from COVID-19 closures, WineDepot is throwing a lifeline to struggling wineries as they quickly pivot to online direct-to-consumer sales.

Australia’s 6,000 grape growers and 2,500 winemakers have been hit hard this year by bushfires, smoke taint and the lowest yield in seven years. On top of this, COVID-19 has had a negative impact on export markets, trade distribution, and cellar doors.

In response to these challenges, WineDepot has announced that it will be providing wine producers a support package of subsidised services to help them maximise their ability to trade during this challenging time.

“Never before have Australian wine producers faced a challenge like this,” said WineDepot founder and CEO Dean Taylor. “The silver lining is that consumers across the country are rushing to order wine and other essentials online for home delivery.”

This has certainly been true for Tasmania’s Josef Chromy Wines, who has been working with WineDepot to maintain strong sales during covid-19 closures.

“We saw a little bit of panic buying happening, particularly when the alcohol limitations started in some states,” said company spokesperson Amy Russell.

Other wineries, however have been slow off the mark. “We know of smaller producers who aren’t selling online and all of a sudden find themselves with no outlets at all.”

To support as many wineries as possible from going under, WineDepot is offering a support package that allows them to maximise their margins from online sales during this once-in-a-100-year event.

“Our platform allows wineries in regional areas to provide a fulfillment service that competes with that offered by the major retailers. With physical depots in each state of Australia, we manage everything so that a winery in Tasmania like Josef Chromy, can deliver the same or next day to customers in Sydney or any other capital city in Australia,” said Taylor.

WineDepot Cellar Door Support Package is valued at over $5,000 per winery and includes the following benefits:

  • $500 free credit
  • 3 months free storage
  • Free initial stock transfer into bulk storage
  • Delivery from just $7.95/case for metro areas
  • Waived platform access, set up and integration charges, usually $995

This is available to all Australian owned and operated wineries, who establish an account and move inventory in before the end of April, with no lock-in contracts or requirements to continue using WineDepot services after the free storage period ends.

“Partnering with WineDepot means we’ve avoided quite a few overheads,” said Russell. “Sitting down here on an island, we have additional challenges trying to get freight off Tasmania, especially at critical times like Cyber Monday and Christmas. Now we have that little bit of an edge in terms of already having stock in market that we can quickly dispatch and distribute.”

The direct-to-consumer sales market is estimated to be worth over $1 billion per annum and employs tens of thousands of people around the country. WineDepot hopes to also help protect this source of jobs, revenue and amenity in regional areas.

 

WineDepot – new partnership with Australian Post and Digitial Wine Ventures

Digital Wine Ventures has announced that it has partnered with Australia Post to help launch WineDepot, a vertically integrated trading and logistics platform aimed at servicing Australia’s multi-billion-dollar wine industry.

Catering for producers, distributors, importers and retailers of all sizes, the platform will allow orders to be fulfilled from inventory reserves held in “depots” servicing key markets – reducing delivery times, freight costs and the opportunity for breakages.

Under the agreement, WineDepot will establish its first four “depots” within Australia Post’s existing distribution centers located in Sydney, Melbourne, Brisbane and Perth.

Digital Wine Ventures CEO, Dean Taylor explains, “Each depot will hold a  broad range of suppliers inventory on consignment, which can be accessed by a range of sales channels. As orders are processed through our platform they are routed to the depot closest to the delivery address where they are picked, packed (by bottle or case) and drop-shipped to the end customer. Depots are then automatically replenished on a bi-weekly basis from WineDepot’s regional bulk storage facilities on behalf of suppliers.

“Being located within Australia Post’s distribution centres will allow orders to flow directly into Fulfilio, Australia Posts fulfillment system, avoiding the typical need for collection, transfer and sortation. This further reduces handling, costs and delivery times.

“With the arrival of Amazon, every Australian consumer will soon expect fast and free delivery. Any business not offering the same will simply lose market share. WineDepot will provide the wine industry the infrastructure to allow that calibre of service level to be provided viably” said Taylor.

Paul Hersbach, head of growth products at Australia Post is positive about the partnership and sees the potential for WineDepot to transform the existing wine supply chain.
“Australia Post is always looking for ways to support Australian businesses, particularly those in regional areas where most wineries are located. As wine is heavy, bulky and fragile, shipping one case at a time from regional areas to consumers in major cities drives higher costs and increases risk of damage to consumer product. WineDepot’s model will address many of these limitations and provide a much improved overall customer experience.

“Our partnership with WineDepot provides the wine industry with a specialised distribution service that will not only save money but also improve the consumer delivery experience. We believe that it will help many wine businesses increase their online sales as they place their inventory closer to end consumers and offer same day evening delivery as a standard service,” said Hersbach.

“It’s why the Growth Products Team at Australia Post was excited to get behind the WineDepot project when it was first presented to us” concluded Hersbach.

Taylor is also excited about the opportunity.

“The partnership with Australia Post greatly reduces our initial capital requirements and allows us to roll out our first four Australian depots by the end of this year well ahead of our original schedule.,” he said. “That’s a massive saving in both time and capital expenditure that will allow us to start looking at ways to expand the platform into other markets such as China, UK, Singapore, New Zealand and USA, as early as next year.”

Taylor expects WineDepot will leverage the learnings from the Australia Post partnership to
establish a working model that they can use in other countries.

“Australia produces $6 billion of wine each year. However it’s just a small part of the $300+ billion global wine market. We believe that our platform has the potential to release an enormous amount of value not just here but globally. Partnering with existing carriers and or 3PL logistics companies like we have with Australia Post in other key wine markets makes a lot of sense.

“There is no point in rebuilding infrastructure that already exists. Our role is to just make it more efficient by providing a technology platform that connects the key stakeholders,” said Taylor.

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