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Start an Online Liquor
& Wine Delivery Business

The global alcoholic beverages market was valued at around
US $1263.19 billion in 2017 and is expected to reach approximately
US $1629 billion by 2024.

Business Model for Setting-up
an Online Liquor & Wine Marketplace

Here is the breakdown of how things work in an online liquor & wine delivery business model

User Registration

Users register on the website through the email address or social logins after confirming their age(18+).Customers will enter their address to find alcohol stores available in their location.

Add to Cart

Once the beverages to be purchased are added to the cart, the customer will place the order and make payments through the preferred payment gateways.

Place Order

The seller receives the order request and starts the packaging process. The product delivery is conducted by the admin or third-party delivery service.

Order is Delivered

Customers will get a notification when their order is on the way.The admin cuts his commission on every purchase and transfers the rest amount to the sellers' account.

Revenue Model of Ecommerce Liquor & Wine Marketplace

A revenue model means a source through which marketplace owners will generate financial income and make their online alcohol delivery business more scalable & profitable. Following are some main revenue models that can help entrepreneurs to earn money from their Online Liquor & Wine marketplace

Commissions

It is one of the oldest and highly recommended revenue channels through which a marketplace owner charges commissions on every order. This commission is charged to the seller by the admin. When a user places an order, the portal owner will receive the order amount and send it to the seller after deducting the commission amount.

Advertisements

Online advertisement is a medium that helps portal owners expand their business and generate huge income at the same time. An online wine marketplace can get higher traffic and revenue via online advertising methods like display ads and PPC.

Subscription Fee

It is a type of revenue model where a seller is charged a subscription fee on a monthly or yearly basis for access to the marketplace. It can also help marketplace owners to predict their monthly revenue on a regular basis. This kind of revenue model is very profitable for those who want to earn money in the long run.

Affiliate Partnerships

In an affiliate model, an online marketplace owner agrees to pay an affiliate in exchange for providing an advertisement and link to the owner's site. Having affiliate partnerships with local businesses can play a crucial role in improving your market reach and scaling your online wine marketplace traffic.

Delivery Charges

The delivery commission is charged by the admin from the buyer. For those online marketplace owners who operate their business independently, making money from the service charges is the most viable revenue model.

Challenges Faced by Online Liquor Stores and Their Potential Solutions

Age Verification

Almost every alcohol website checks the age of users by enquiring their month of birth and year or by just asking them to confirm their age by simply ticking a check-box. It's very easy for customers to enter their false age in the portal and such a deceit can't be tracked easily.

Solution

In order to examine the real age of users, you could develop an interface on which users have to submit an ID proof, which will be accepted or rejected by the admin. Moreover, you could also add a feature like "adult signature confirmation" according to which the delivery boy will require an adult recipient's signature to submit the parcel.

Temperature Control

Keeping alcohol fresh and beer cold during the delivery is one of the major challenges in the online alcohol industry. Controlling & maintaining the temperature of alcohol can be very difficult throughout the delivery process.

Solution

In order to maintain the alcohol quality, online alcohol marketplaces should allow delivery partners to delay the shipment if the temperature is not within 45°F-80°F range.

Shipping Services

Many online alcohol stores charge high shipping fees based on various factors like beverage type, weight, packaging material and time & location for the order's delivery. Packing and delivering alcohol without hampering its quality is another crucial challenge surfacing the online liquor industry.

Solution

Hiring a separate logistic partner that provides multiple services like product packaging, storage, distribution processing, and on-time product delivery can help you effectively streamline your delivery process.

Country Wise Rules and lawful restrictions

Manufacturing and shipping alcohol following the country's guidelines and laws have been the biggest challenge in the online alcohol industry. The existence of federal and state laws makes it difficult for entrepreneurs to create a wine & liquor marketplace.

Solution

Understanding the rules and regulations of the country or state in which you want to manufacture alcohol and getting a proper license before selling or delivering it could help you easily set up your online alcohol business.

Three-tier Distribution System

Traditionally, alcohol that's sold in brick-and-mortar stores has relied on the three-tier distribution system, which means an alcohol manufacturer must sell their products to distributors and then distributors will sell them to the retailers. Because of the working process of this model, only big brands have had the opportunity to be distributed nationally and earn more profits as compared to small-scale businesses.

Solution

Using Direct to consumer sales model, in which a company sells its products or services directly to their consumers, can help you overcome the limitations of a three-tier distribution channel. You can create a direct connection with your customer by setting up an online alcohol marketplace.

How to Build an Online Liquor & Wine Delivery Website and App?

Selecting the perfect wine requires a particular sense of taste and so does building a Liquor & Wine ecommerce website and app. As an ecommerce entrepreneur, if you're thinking to launch a profitable Liquor & Wine ecommerce website and app, here are a few things you should keep in mind before initiating the process:

Select a Custom
Ecommerce Solution

As there are a multitude of custom ecommerce solutions available online, finding the best platform for creating a website is a difficult task. So try to choose an eCommerce solution that works for your brand. It's recommended to do some research before selecting a solution that could fulfill your business requirements.

Add Suitable and Innovative Features

Age Verification

It is one of the must-have features of an online wine delivery website. Even though it's hard to track whether a customer has violated the law by entering the wrong age, you must add an age verification plugin into your website to avoid any consequences.

Product Comparison

Adding product comparison feature will allow buyers to choose the best option among multiple products. They'll be able to compare the strengths, weaknesses and price of the available products with this feature.

Best-Selling Products

Many people shop online for convenience and placement of such a feature would improve the user experience of the website. It'll also be beneficial for sellers registered on the marketplace as they can display their best-selling products on the homepage by paying some amount of money.

Multilingual Functionality

Including multilingual functionality in your alcohol website can help you expand your business to the global market. Communicating with users in their native language could give them more flexibility and comfort.

Multi-Currency

By accepting payments in multiple currencies, you can easily tap into the global markets and grow your pool of potential customers. This feature will derive customer satisfaction by providing them the convenience of placing order in regional currency.

Membership

An online wine marketplace should be able to earn revenue by membership option. You can give additional benefits like free delivery, quick delivery, bonus points, extra discount, etc. to your members

Find the right
shipping partners

Shipping alcohol across the globe can be precarious. So for a trouble-free shipment you must choose trustworthy shipping providers like FedEx and UPS to get the job done without any hassle. Moreover, selecting the right shipping partners could provide your business a huge opportunity to boost sales and improve your customer reach.

Launch and Promote
Your Store

Once you are done with selecting a custom-built software, adding suitable features and finding the right shipping partners, the last and the most important step is to launch and promote your store. The best way to reach out to your audience is to use social media platforms like Facebook, Twitter, Linked In, etc. You can also launch various promotional cards or offers to attract a large number of customers and encourage more sales.

Market Leaders in the Online Liquor & Wine Industry

Disclaimer: FATbit/Growcer is not associated or affiliated with any of the brand name or trademark used on the page. They are properties of their respective owners.

FAQs About Selling Liquor & Wine Online

Is selling alcohol by a private individual legal?

If an individual owns a liquor license issued by the state government, then it's legal to sell and deliver alcohol online to customers. However, the regulations for obtaining the license may vary from state to state, so it's necessary to consult an agency specific to your state to avoid any consequences.

Do I need a license to sell wine online?
Can I sell wine internationally?

Expanding your online wine business globally could play a significant role in increasing your revenue flow but there are a few things you should keep in your mind before you go down that road.

  • Understand the shipping guidelines: When it comes to shipping overseas, understanding the exact shipping requirements for the country in which you want to sell alcohol is a necessity. Package restrictions, parcel weight and size limits could vary from country to country. So make sure you follow all the rules issued by the region from which you're shipping as well as the region to which you're shipping.
  • Use high-quality packaging material: You must use sturdy packaging to avoid any damages as your shipment will go through multiple processing centers and travel in different types of vehicles before getting delivered to your customers located globally.
  • Get familiar with custom documentation: You must complete several different certifications like the certificate of free sale, certificate of health, certificate of sanitation, etc. to export wine internationally. It will be the responsibility of the seller to confirm the overseas documentation requirements for the sale of wine online.
Can I sell alcohol online in Canada?

Yes, you can sell alcohol online in Canada, but only in certain regions. As every Canadian province has certain rules and regulations regarding the online trading and delivery of alcohol, it's mandatory to get familiar and understand all the regulations imposed by a particular province before you start your online alcohol business.

Can I take my offline wine shop online?

Yes, you can take your offline wine shop online and reach a wider audience by creating your website with an ecommerce solution but finding a suitable one could be a time-consuming task. This is where Growcer Lite, a turnkey ecommerce solution comes in handy. It helps you to create an efficient platform for your online alcohol business within a few days.
An online wine store created through Growcer Lite will act as a stand-alone website where a single vendor will sell beverages to several customers.

Will Online Liquor & Wine Retail Sector Bloom After COVID-19 Crisis?

For a clearer insight into what future holds for the online alcohol industry, have a look at the official statements issued by some prominent market leaders in the online liquor and wine delivery business:

  • CEO of Minibar, Lindsay Andrews, recently told in an interview that the massive growth in the number of people using online wine delivery services have cleared the fact that online alcohol delivery is here to stay for long even after the pandemic.
  • According to Reid Greenberg, executive vice president of digital and e-commerce at Kantar, the faster growth of e-commerce alcohol delivery has convinced people that purchasing alcohol online is much easier and convenient than buying it from a physical store. Hence, there is a huge opportunity for alcohol retailers to set up an online alcohol marketplace and thrive in online alcohol retail in the future.
  • In the interview with the CNN business, Drizly CEO, Cory Rellas, said that consumer awareness of the alcohol ecommerce category has exploded since the beginning of Coronavirus, as more people turned to delivery services as a safer alternative. The awareness for alcohol ecommerce that has permeated into the mainstream media during the outbreak would spur further increases in sales in the coming times.
  • Nils Wunch, research analyst at Statista, explained in a survey that most of the consumers in the European countries like the UK, France, Spain and Germany have increased their alcohol consumption during March and April due to Coronavirus outbreak. The reason for more alcohol consumption is the growth of ecommerce alcohol delivery, which is a clear indication that people might become accustomed to purchasing alcohol online post-COVID-19 as well.
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