DTC Shipping

Changes for Alaska with Alcohol Laws, DTC Licenses for Wineries

by Katherine Pasichuke

On June 16, 2022, Alaska Governor Dunleavy signed Senate Bill 9, revamping the future for alcohol compliance for the state. SB 9 has placed new requirements on wineries, breweries, and distilleries shipping directly to consumers in Alaska. Up until now, wholesalers and manufacturers have not needed licenses to ship directly to Alaskan consumers.

SB 9 creates a manufacturer direct shipment license, with a biennial fee of $200. This new license authorizes the holder of a brewery retail license, winery retail license, or distillery retail license issued in another US state to sell and ship their products to Alaskan consumers. 

SB 9 also imposes new tax obligations on direct shippers. Once enacted, the holder of a manufacturer direct shipping license will be subject to the Alaska alcoholic beverage tax. Licensees will also have to send monthly statements and payments to the Alaska Department of Revenue, including total gallons and gallonage of each kind of beverage sold to consumers. Other requirements within SB 9 to be aware of include prohibiting shipping to consumers in dry areas of the state where the sale of alcohol is prohibited, using only ABC-approved common carriers, and abiding by certain volume limits

SB 9 does have a capacity cap for beers and distilled spirits manufacturers producing large quantities annually, but not for wine.

The Alcoholic Beverage Control Board is set to start accepting applications for this new license starting September 1, 2023, as SB 9 will take effect January 1, 2024. Until then, direct shippers may continue to ship into Alaska sans license or paying Alaskan beverage tax, but should keep on their radar that change is coming.

Citations:

http://www.akleg.gov/basis/Bill/Text/32?Hsid=SB0009C
http://www.akleg.gov/basis/Bill/Detail/32?Root=SB%20%20%209
https://wineinstitute.compliancerules.org/state/alaska/

DTC Shipping now OK in PA

As reported in Wine Business.com, Governor Tom Wolf of Pennsylvania signed a bill permitting out of state wineries to ship wine to PA residents. There is a limit of 36 cases annually per person. The bill makes PA the 44th state in the USA to allow DTC shipments; it will go into effect August 8, 2016. Licensing procedures and other bill requirements may take some time to implement, but this does open up the 12th largest U.S. wine market to out of state wineries. Please contact us for more details.

The bill also provides for groceries and restaurants to sell wine to consumers.  Prior to the Governor’s signature on H 1690, alcohol sales were controlled through state liquor stores and sales were not allowed on Sundays.  The Sunday rule has been eliminated, although the Liquor Control Board will retain control of spirits sales for the time being. Find the full story here.

 

 

 

2015 DTC Shipping Report Recap

It is an exciting time to be making wine in the United States now that our nation officially holds the number 1 spot in consumption of wine throughout the world. The 2015 Direct to Consumer Shipping Report featured in the February issue of Wines and Vines Magazine highlights the continued rise in interest of wine throughout the United States. A collaboration between ShipCompliant and Wines & Vines Analytics, the database/ research arm of Wines & Vines Magazine, tracked winery-to-consumer direct shipping channel sales from January 2014 through December 2014 throughout the country. The 2014 time period experienced its most significant growth since these figures started being tracked in 2009.

 

The DTC shipping channel increased 15.5% over 2013 and reached $1.82 billion in sales. The total volume of wine shipped throughout the country increased 13.6% to 3.95 million cases. Combined, California, Texas, New York, Florida and Illinois received 59% of these shipments. As states continue to alter their policies regarding direct to consumer shipping laws, more channels are expected to open in the coming years. Montana (245%) and North Dakota (61%) have experienced dramatic increases in wine sales following changes in DTC laws. Record numbers are expected in 2015 with Massachusetts opening its doors to DTC shipping. The nation’s seventh largest market for wine with a population of 6.6 million, it is estimated that Massachusetts could easily spend $29 million during this first year of DTC sales.

 

The bulk of shipments made throughout the year take place during the last quarter. October, November & December account for 40% of all shipments placed throughout the year. November 2014 proved to exhibit the highest growth with a 21% increase in the value of shipments over November 2013 due in part to an 8.1% increase in the average bottle price to $45.44

 

To date, Napa remains at the apex of direct to consumer shipping in the Unites States. The region accounted for 32% of all DTC shipments made during 2014 calendar year.

Massachusetts opens for DTC Shipping

Starting January 2015, Massachusetts will allow limited, regulated winery-to-consumer shipments: Massachusetts’ adult residents will be able to purchase wines directly from wineries licensed by the state to ship.

The move comes after years of closed door laws. The change in Massachusett’s law brings to a close a decade-long effort to open the state to direct shipping, pulling it out of the ranks of Pennsylvania, South Dakota, Kentucky, Utah, Mississippi, Delaware, Alabama, and Oklahoma.

“The budget language is based on the model direct shipping bill being used successfully by the majority of U.S. states. It requires wineries to apply for a state-issued shipping license, to mark boxes as requiring signature at delivery, to pay taxes, and to limit the quantity of wine shipped to individuals.” — FreeTheGrapes.org

Read the full press release here.