N.J. wineries raise a glass as law that allows them to ship directly to customers takes effect
by Ryan Reclaim on 01/02/13
New Jersey wine connoisseurs can now have bottles from the state’s wineries shipped directly to them, after a bill signed by Gov. Chris Christie in January went into effect Tuesday.
It won’t dramatically increase profits for New Jersey’s wineries, said Tom Cosentino, spokesman for the Garden State Wine Growers Association, but it still represents a significant change to the law.
“It’s going to be a slow roll-out. If you’re a winery, right now you’re getting set up to sell online,” he said. “It’s going to take time to see the impact. This law was never meant to be a panacea that makes wine growers millionaires because of direct shipping. The industry sees it as a way to grow their audience.”
Before the law went into effect, neither New Jersey nor out-of-state wineries could ship their bottles directly to customers here unless they did it through a wholesale distributor. The new law cuts out the middle man, allowing wineries to earn more profit per bottle by selling them directly to customers at retail prices. It also made available a permit for out-of-state wineries to sell to New Jersey customers. The state’s Division of Alcoholic Beverage Control has gotten calls from interested sellers, said spokesman Zach Hosseini, but no one has filed an application yet.
The change makes New Jersey the 39th state to allow direct winery-to-customer shipping. Most of the state’s wine growers currently rely on booths at festivals and tasting rooms at their vineyards for sales.
The Heritage Vineyard & Winery, which grows its grapes on 40 acres of the Heritage estate in Mullica Hill, has had to prep staff to tell customers they will be ready to take delivery orders in a month.
Bill and Penni Heritage, the husband and wife who own the winery, already sell two of their semi-sweet wines to liquor stores in South Jersey through a distributor.
They’re low-end, affordable bottles meant to get the winery’s bottles on shelves.
“We make 18 different types of wine and most liquor stores that sell our brand carry two of them, Jersey Red and Jersey White,” said Richard Heritage, marketing and sales manager at his parents’ Mullica Hill vineyard. “I would say now people across the state have access to our other 16 wines without having to drive down here to find it.”
Those 16 wines account for about 40 percent of 156,000 bottles the winery produces each year, but are only available from tasting room at the vineyard.
“Direct shipping will help us push those out to people who want them,” Heritage said.
The family expects to increase its production of those high end wines about 10 percent this year and 20 percent next year, when it applies for licenses to ship to other states.
It will cost about $26 to ship a case of wine to New Jersey residents according UPS ground rates, Heritage said, and $13 for a single bottle.
The law prohibits delivery drivers from leaving alcoholic beverages outside someone’s door or letting anyone under the age of 21 to sign for a package.
“Should we receive intelligence that underage drinkers are purchasing or receiving alcohol by direct shipment, we will use every means of our enforcement authority to put an end to that,” said Michael Halfacre, director of the Division of Alcoholic Beverage Control.
There’s also a 12-case, or 144-bottle, limit on shipments residents can receive per year.
“That prevents someone from opening a liquor store in their garage,” said Cosentino, “getting tons of liquor and reselling it.”
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