FedEx/UPS - I have to start my own wine shipping company.

I just had an infuriating experience again, which just makes me want to start a dedicated wine shipping company so we can all get away from these idiots. More about that at the end.

Customer in Alaska ordered a case for $390. FedEx charges me $158 in shipping to send it there. It get returned to me for some reason with a label that says “improper shipment”. When I call FedEx I get some call center in India where nobody knows anything. They keep telling me, “it’s probably because you shipped alcohol”… Yes, I know. I’m licensed to do so, duh. No further explanation, nobody can specify the correct reason except reiterate the “improper shipment”. But here’s the real infuriating part. When I check with billing, they still charge me the $158 for the package despite the damn thing never even leaving the greater Los Angeles area before it got returned! That’s the most expensive local shipment in the history of shipments. When I demand a refund, they say “we don’t do refunds or credits during Covid-19”. When I demand a manager, they reiterate “we don’t do refunds during Covid-19”…

So what do I do now? Try to ship it again for $158, taking my total shipping cost to $316 on a $390 sale, or just refund this customer and only lose the $158? If the package comes back a 2nd time I’m really screwed - then I’ll have to refund him and swallow a $316 shipping bill.

God, it’s infuriating. And it has yet again reinforced this idea I’ve had a for a few years: What if there was a dedicated, temperature controlled DTC wine delivery solution? What is the one thing us DTC wine consumers can be flexible on? Wine delivery times. As long as they are trackable, arrive safe, stay in a cold chain or temperature controlled environment the whole trip, we don’t really care about how long it takes to get to us, right? This means you could “fill” a truck up until it makes economical sense to go an a cross nation delivery spree with 100-200 stops.

Maybe the economics of the model is non-sustainable and there are things I’m overlooking, but on paper it seems like it should be doable.

I know it will be a PITA but is it possible to take the package directly to the local distribution center (not FedEx/Kinkos) and have your paperwork showing that you have been authorized legally to ship wine and appeal in person? Seems that a manager there should be able to authorize the shipment but who knows.

Not possible. The infrastructure costs are staggering and there would not be enough density. Perhaps a third party logistics provider who specializes in alcohol and would have enough clout to get good service.

Did you have the FedEx supplied and required alcohol label on the outside of the box, did you denote as an alcohol shipment on the airway bill? When I set up my account I had to deal with FedEx legal and they gave you all the parameters on how to ship before sending you the required labels. Just a thought…

Yes, I had all the stickers and compliance things all set up with FedEx etc. Still not sure why it came back. Customer had another shipment going to Alaska, so in the end I drop shipped it to his depot instead, which only added another $40-50 to it. Still, a close to $200 shipping cost on a $390 sale is rough.

Maybe I’m being naive, but so far this year I’ve spent close to $10K on shipping with FedEx. At the end of the year it will probably be $20K. It wouldn’t take many small winery customers to join you to pay for a full time driver at $50K/year, lease a Sprinter van and fuel- and voila - you could be doing DTC chilled fulfillments door to door. I am confident that if you offered small wineries or retailers a chilled service from pickup til dropoff at similar cost to regular FedEx, you’d get some takers. In my experience, most of my customers are not time-sensitive, they’re quality-sensitive.

Some retailers, wineries and wine clubs deliver locally. Moreso now, such as Ridge, since they have a large number of local customers who would normally pick up. They operate that out of their Saratoga office. K&L does scheduled deliveries, with the fee varying by proximity zone and order size (enough and it’s free). The scheduling allows them to be more efficient, I’m sure.

I believe (correct me if I’m wrong) Golden State Overnight started very wine-centric and was regional. They were reportedly excellent when they were small. I’ve heard serious complaints about their service to some areas later, which would be due to lack of direct oversight, lower quality of newer managers and drivers.

None of that touches on interstate shipping and the bureaucratic nightmare of state and federal laws, and all the logistical hurdles.

So you ship wine to customers on your dime? UPS is far from perfect but in my experience better than FedEx which is better than GSO. We use VinoShipper for out of state orders/compliance and they only use UPS. We have had a couple breakage issues that were quickly resolved by VS & UPS and covered by their insurance. All it takes is one major shipping disaster to mitigate small savings with cheaper companies. Also, it seems like the UPS rates are better via VS than by us directly using UPS.
Starting your own delivery company? Almost a crazy as starting your own winery [wow.gif]

Steve, UPS messed up so bad with my compliance paperwork that it’s not even fully resolved now - over 6 months later. What makes it even worse with all these companies is that there is not one single person to talk to. You get lumped in with everyone else who just wants to check on their tracking number and end up in a call centre in Bangalore calling a 1-800 number. To try to find a direct phone number to anyone on their website will result in failure. Nobody knows anything, nobody can take responsibility and nobody can solve any real problems. It’s very frustrating.

But yes, I went into this thinking UPS would be the higher quality provider. They’ve always seemed a little more on point then FedEx. But from dealing with them now, I’ can’t say they’ve lived up to that. But I’m looking to join ShipStation I think, so will probably have the opportunity to use both in the future as it goes through their portal instead.

From a consumer perspective, I wish storage and shipping would create a network. I use Domaine to get most of my wine from retailers / auction houses to my offsite storage (it’s the reason I went with them). If this model expanded it would be really helpful (bottle tracking, packing, shipping logistics, possibly bond if holding overseas and short term or long term storage all in one)

How does Domaine work?

Lots of specifics on their site, but basically they provide storage in Napa, St Louis, Chicago, DC and NJ as well as offer shopping services:

(From their site)

Wine Transport Option 2: Domaine PickUp

We designed Domaine PickUp to make shipping easier for our clients.

When you choose Domaine PickUp, a Domaine Team Member, who specializes in wine handling and logistics, picks up your wine wherever it is, including retail shops, auction houses and wineries.

It’s better than shipping, because Domaine picks up your wine year-round with a fleet of temperature-controlled vehicles.

Better still, Domaine brings your wine back to one of our 5 storage facilities that is maintained at ideal conditions for long-term storage, 55°F and 70% humidity.

From the moment your wine is picked up, it’s perfectly cared for like the rest of your collection.

To learn more about Domaine Pickup, visit

Wine Transport Option 3: Multi-Pallet Shipments

Domaine Transit is equipped to provide full-truckload temperature-controlled shipping. If you are a commercial wine company, auction house, or an individual trying to ship a large collection, we can help. Please complete our wine shipping form for an estimate.

Ahm. Are u going to have that driver drive 1 box of $390 wine all the way to Alaska?

Yes 1 Van is cheap.

FedEx has hundreds of thousands of vans. U can’t produce enough volume to sustain a wine shipping company. There is a reason there aren’t 10 other FedEx/UPSs in the world. :slight_smile:

Alaska and Hawaii would have to be excluded. But no, the idea would be to wait until there are a certain amount of packages going to a region. Like I mentioned, you’d have to as a customer give up speed for quality. I’m not sure how many would do that, but my guess when it comes to wine, probably quite a few.

I do all my deliveries here in greater LA myself. And sometimes it sucks driving 1.5hr down to Laguna Niguel only to save $25. But then you have 10 deliveries within 5 miles on the westside and save $300 in half a day.

Driving a van full of shipments to New York. Then return to ur winery to get more wine to drive to Kansas City. Then return and then to Tampa etc? Shipping cost would be 10x the cost of wine lolll

If u meant socal region last mile fulfillment, that’s one thing. But u need air hubs if u want to ship around the country. Of course u could also lease a plane :wink:

No, what you’d do it is pick up all the deliveries in the Finger Lakes/NY for Riesling going back to CA! [wink.gif]

Maybe try getting in touch with David Studdert at Wine Country Connect? He’s the guy who started wine.woot and now runs (and does sourcing/fulfilment for a few other sites) - but he’s a logistics guy originally and has worked out efficient ways to get wine out. I don’t know if he’s able to be a direct service provider or if he can offer you some tips, but I could try to get you two in touch.

The only company I can think of that built a UPS/Fedex replacement is Amazon. So not a good example of modest scale.

Despite complaints about GSO I still use it frequently and find it at least as good as UPS/Fedex, and cheaper within California.

I think the way to go (other than starting your own, which is going to be hard) is to partner with Domaine or similar partner if you can find them. Or, in Covid times with millions looking for work hire a local person to do deliveries for you one day a week (though just starting to imagine the potential issues and liabilities makes me shiver).

Adam, so you are getting your own license in each state and submitting tax returns in those states? Maybe you shouldn’t answer that in a public forum [snort.gif] You might want to check out VinoShipper if you haven’t. They handle compliance, taxes, and logistics for shipping to other states. When there is a shipping problem, they deal with UPS as they are technically the shipper. Its pretty slick, customer or you enter order online. VS emails a packing slip and shipping tag to you, you pack it up, slap the shipping info on it and drop at UPS prepaid. VS send you money every two weeks and they deal with any messed up shipments. Your out-of-state wine club folks can update the credit card online saving you time. Merchant fees are a little lower than other services and I think the UPS rates are a little better to your customers. I think VS pricing is fair and it opened up most of the states (a few bible/booze belt exceptions) for us. Very little work to set up and piece of mind to be completely legal, which most small producers find hard to do.

Second vino shipper have never used them but know others who have and heard good things