Friday, October 7, 2011

Selling wine

I read a post by my friend Jo Diaz, discussing the problems of how we as wine consumers can go about selling a bottle of wine that's in our possession. In her article Jo suggested two well known auction houses. I proceeded to write a detailed comment on her blog, which the capricious software elected simultaneously to reject and delete. Rather than spend the time typing it all in again there I thought I'd answer here instead.

As a private individual you are faced with two distinct problems: firstly, that it's typically illegal to sell wine that you own without a licence* and secondly that it's not simply illegal to ship wine, it is in fact one of only two ways that you as an individual can violate the US Constitution. The 21st amendment - possibly the most tersely worded piece of legislation since the ten commandments - section 2 states: The transportation or importation into any State, Territory, or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited.. Incidentally, if you're curious, the only other way that you can violate the constitution is to enslave someone. Of course if you get your slave to deliver the wine then by the legal principle of duos nefas correctum you're probably okay. But I digress.

The simplest, legal way to sell your wine is therefore to contact a local wine retailer who specialises** in such things. In the Bay Area, one such retailer is K&L Wines; they have an entire department dedicated to purchasing private collections. They typically prefer to buy entire cellars rather than individual bottles, so this may not be ideal for someone seeking to sell off a few extra bottles. You will also need to demonstrate provenance; that the wine has been stored appropriately and how you acquired it.

The other legal way its to use a licenced wine auction house. There are several around, but the best known among collectors is probably WineBid. You will need to ship or deliver the wine to them to be appraised; since they are licenced they will provide appropriate paperwork which means that it's they who are legally responsible for shipping (although you are the one who pays). Since it's an auction you can't negotiate a price up front, though you can specify a reserve. However if the wine fails to sell due to too high a reserve there may be a fee to pay. You will also pay a commission of around 15% to 25% of the "hammer price" when the lot is sold. As with retailers, many auction houses don't like to deal in small lots, so there may be a minimum amount that they will accept. It may also takes some weeks before you receive the money for your sale.

There is a second type of auction house which is unlicenced; the best known is WineCommune. This operates in a similar manner to sites like eBay; they simply connect buyers and sellers; they take no responsibility for the legality of the transaction. The benefit is greatly reduced commission fees (around 3% to 5%), but the trade-off is that there's very little comeback. Since selling without a licence is illegal you're breaking the law and there have been instances where the authorities have fined sellers, though these have apparently been people using the service extensively rather than casually.

The last option is a private sale on an online wine forum. There are many discussion forums (or fora, depending on your preferred level of pedantry) which include a commerce or trading area. The benefit of these boards is that you're likely to agree a price close to the real value of the wine without paying commission charges. However it's a good idea to establish yourself as a member of the board before offering wines for sale; the boards can be suspicious of (and merciless to) brand new users posting lists of wines for sale.

If you choose to use either of these latter approaches you hit the second snag: it's illegal to ship the wine without a shipping licence once you've sold it. Carriers won't even accept a shipment if they believe it contains alcohol. So unless you have a contact with a shipping licence you need to be creative. A common approach is to label the package as containing some other liquid, such as Olive Oil; another way is to disguise it using boxed previously used for some other purpose. Either way, rather than taking the package to a carrier's office it's generally considered safer to leave it to be picked up, especially if you work for a large company that has a daily collection. Even so, there have been instances where packages have been intercepted and destroyed, so be aware, particularly when shipping to states with more draconian rules.

So there you have it. You can either pay huge fees, accept a fraction of the wine's value or become a criminal.

* I'm British. That's how it's spelled. And wile we are on the subject, there's a U in Colour.
** See previous. It should be a S not a Z***
*** Which is pronounced "Zed" like "bed"