The Grapevine

Amazon, Whole Foods, and Your Local Wine Shop

October 10th, 2017

Amazon has been nibbling around the edges of the wine market for quite some time. With that toe-dipping came concerns of impending cataclysm for main street wine shops. Amazon’s purchase of Whole Foods was viewed as perhaps the final nail in local retail’s coffin but it may in fact provide a reprieve. [level-members]

As this Wine Searcher article points out, the three-tier system, with it’s mish-mash of different regulations from state to state, means that Amazon/Whole Foods may be in danger of running afoul of those regulations. Amazon may not be a producer, but it is a distributor and now a retailer. You only get to pick one of three …

While this is potentially good news for local shops, it is probably only a temporary situation. It’s hard to imagine that Amazon won’t fight hard to either lobby for changes to the regulations or have their lawyers work some magic on their corporate structure.

Either way, it’s an excellent opportunity for small retailers to reflect on what they can do to differentiate from giant competitors and two things come to mind:

  • Personal service
  • Interesting selection

Some large retailers are fortunate enough – and good enough – to attract and hold onto a truly great employee or group of employees who are knowledgeable and passionate about wine, and who can make intelligent recommendations. But that is probably the exception to the rule. To win here, you have to know what’s on your shelves and makes sure your shelves are stocked with wines that can cover everything from a cookout with a crowd to an angst-ridden dinner for four with a new bosses and spouses.

Speaking of stocking your shelves, you have to stock them with wines other than “typical supermarket choices.” You’re going to lose the price war and the convenience war, so you better be more interesting in your selections.

I don’t want to minimize the danger that supermarket sales in general or Amazon in particular pose, but there is room for another kind of shop, even if there is likely to be room for fewer small shops than there are now. You simply have to make the choices that will let you not just survive as one of the remaining local shops, but thrive.