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Automated ‘direct’ consumer sales tool to launch in US

A Napa company is set to launch an Internet-based system that can cut through the bureaucracy separating American producers and consumers.

Inertia Beverage Group will give its new system, which cost US$500,000 to develop, to all US wineries on a no-cost, no-fee basis starting 30 August.

The purpose of the system, which can be downloaded for free at rethinkcompliance.com, is to overcome interstate shipping problems that dissuade producers from offering their wines across the 50 states.

Although in 2005 the US Supreme Court struck down protectionist barriers preventing wineries from shipping directly to out-of-state customers, major impediments still persist nationwide.

This blockage arises from the US Constitution, which empowers each state to regulate alcohol sales in their own way.

While interstate shipping has boomed since the ruling, complex regulations together with new state legislation discourage many vintners from taking costly, time-consuming legal compliance steps.

Inertia’s system lists compliance requirements in all 50 states. After producers upload information about their wines and private customers’ ordering records, their computers tell them what they can and cannot do in each state.

The system explains licensing requirements. It lists states that prohibit shipments and it reports limits on the number of bottles that can be sent directly to private customers during calendar periods. It also generates tax reports that vintners can send to state agencies.

When CEO Paul Mabray is asked why Inertia will give away the program, he offers ‘a rising tide lifts all boats’ explanation. He believes that freed-up direct shipments will attract increased numbers of consumers, thus generating increased sales that could benefit the whole industry.

Inertia, which provides technology services for 350 brands, is betting that vintners who increase their direct sales will become new customers. It hopes they would buy its other products, including specialized software that manages such practicalities of direct sales as inventory management, automatic e-mailings, market-basket content and credit-card processing.

Written by Howard G Goldberg in New York

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