My Old Kentucky Home
My friends all know I have a love/hate relationship with the state I grew up in: Kentucky. As an immigrant, being a kid in the rural Kentucky public school system was not a kind experience — however, once in a while, I do reminisce about those rolling bluegrass hills and white picket horse farms. When my husband and I visited Napa this past year for my birthday, we thought it’d be a great idea to join a wine club and ship cases to our families for holiday gifts. Much to our surprise, we were told that it was illegal to ship wine direct to consumers residing in Kentucky. As of March 2020, there are only five states, including Kentucky, that do not allow DTC shipments from wineries to wine drinkers. This month, I was ecstatic to hear that the state legislature has advanced a bill that would allow out of state wineries to ship DTC. According to WFPL News, "Supporters of the bill say it would allow Kentuckians to participate in 'wine of the month' programs or to ship wine home while on a vacation”. Opponents of the bill include local distributors and alcohol industry groups married to the three-tiered-system. Wholesalers, in an effort to protect their margins, have suggested that only wines not available in stores should be allowed to be shipped DTC. In addition, the Wine Institute has "recommended that wineries not ship to Kentucky until tax issues with the measure are resolved”. It will be interesting to see how this plays out — I wonder if this measure will have an impact on the bourbon industry in Kentucky and how much overlap there is between the two customer segments. DTC shipments of spirits and beer will have to wait their turn, but perhaps this year, I will finally be able to share the wines I love with my family!
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Thanks for this post and hope you can send wine to Kentucky soon! It has always fascinated me how much control each state exerts over the alcohol industry and how much it varies from state to state. As a former resident in neighboring Ohio your post inspired me to look up our own distribution system and whether I could ship DTC to family. As it turns out, Ohio's Department of Commerce issues two types of wine permits that allow wineries to sell directly to both permitting holding retailers and to consumers (as long as you don't purchase more than 24 cases per year as a consumer!). Digging deeper there is actually an interesting exemption in Ohio for active duty military members can bring 4.5L of wine into the sate without paying any tax on it every 30 days. When you dig in, it never ceases to amaze me how unique some of these rules can be!
ReplyDeleteOn a related note, it seems there is an opportunity for shipping companies to work with states to be able to deliver alcohol to residential addresses without a signature. For example, when I sent my parents wine as a gift, I had to spoil the surprise a bit to tell them that they needed to be around during a certain window to sign for a package. While this was admittedly a minor inconvenience for them, for many working professionals, it can be a challenge to schedule package deliveries when they're home and there may be professional or cultural reasons why shipping to their workplace is not ideal. Perhaps there is a way to design a verification system that allows you to upload an ID and the delivery person to confirm the information matches before leaving the package. I recognize that this may be an oversimplification but given the importance of wine clubs and DTC shipping to vineyards' profits it seems worth exploring.