The Real Cost of Shipping Wine - Why Wine Clubs Aren't Ripping You Off
Wine Club Buying Guides
Online Wine Buying
There are a lot of factors that go into the cost of shipping wine, whether the shipper is a wine club or a winery, an online wine store or your local wine store. No matter how much it does cost to send you your wine, you can be sure the company that sold you the wine hates it as much as you do... they know they can sell more wine if you get free shipping.
When we think about shipping costs, most of us stop thinking about it at the question of “is it free?” While free shipping on wine is a great deal when it comes along, shipping is a service that costs a lot of money. The actual costs and profit for the shipping company, whether it’s FedEx, UPS, the USPS, or a small private carrier certainly weigh in to the total. And as gasoline prices go up, the cost of shipping goes up.
Here’s a breakdown of all the other costs associated with shipping wine within the United States:
There are two components to the weight of a shipment of wine: how much the packaging weighs, and how much the bottles weigh.
When a wine club or a wine store selects its packaging, among its considerations are how much the boxes weigh and how much the inserts which protect the bottles weigh. They of course have to consider the protection factor against the actual weight of the materials.
Certain types of packaging are more affordable than others. Considerations include styrofoam packers (which also protect wine against temperature fluctuations) vs cardboard-like shippers made from molded fiber. Some wine clubs choose recycled-material molded fiber shippers to be more environmentally friendly.
These shipping materials come in pre-made sizes and bottle-counts, so often wine clubs and online wine stores reward shoppers for buying in quantities that work for maximizing the cost of shipping the wine per bottle. Usually that’s 3, 6 or 12 bottles per shipment. (The 3-, 6-, and 12-bottle shippers use the same inserts offering more flexibilty). There are also single-bottle shippers and two-bottle shippers especially made for gift-giving.
While the wine inside a bottle always weighs roughly the same amount, the weight of the bottles can vary greatly. When a winery chooses their wine bottles, one of their considerations is how heavy the bottles themselves are. They may choose heavy bottles because it creates a more impressive experience. The unfortunate side effect of that is it costs more to ship those heavier bottles. While wineries can consider this and build it into their shipping costs, by the time a retailer or a wine club gets the wine, the decision is made and they’re stuck with whatever they’ve got. A 750 ml bottle of wine can weigh between 3 and 4 pounds—a 25% difference in the weight of each bottle makes a big difference in shipping costs, especially on a 12-bottle case of wine.
How far wine is being shipped also plays a big role in the cost of wine shipping, even if online wine stores and wine clubs don’t charge different rates for customers in different locations, it’s a part of the cost. Much of the wine from U.S. ships from the west coast, mostly California. Some wine clubs choose warehouses in the midwest to keep costs roughly equal as wine gets shipped to each coast. And much of the wine imported from Europe is warehoused on the east coast, in places like New York.
In addition to how far the wine is being shipped, FedEx (and most other carriers) actually charge more to send packages to residential addresses as opposed to business addresses. What? Yep. Before you get all annoyed, there’s a valid business reason behind this surcharge... when you deliver something to a business during business hours, you drop it off and get a signature and you’re done. When you deliver to a residence, a shipment which requires an adult signature and can’t be left at the door, you risk someone not being home. Then you have to take the time to leave a notice and attempt redeliver the package. That gets expensive.
You’ve probably heard this phrase before. If you haven’t, it’s one of those basic rules of business where if you can buy more from me than the average customer, I’ll give you a volume discount. This affects the cost of shipping wine because the bigger wine clubs and retailers can get better rates on their shipping materials and shipping rates (in addition to better prices on the wine).
Here are some sample prices of 100% recycled wine shippers to get your head around the actual costs of shipping wine (as found on WinePacks.com and SpiritedShipper.com, not precisely real-world prices):
|Shipper Size||Retail Price per unit (includes boxes)||Bulk Price per unit (excludes boxes)||CA to NY Shipping to a residence on FedEx (20% Volume shipping discount)||Total Cost of Ground Shipping (Bulk Pricing)|
And here is an example of a real wine club's shipping rates:
If you were ever charged $60 to ship a case of wine, you’d be irate... more to the point, there is no way you would ever order that case of wine unless every bottle in it were at least $5 below the price you could get for the wine at your local wine store. The wine clubs and wine stores know this, so they subsidize the shipping costs —or they rely on an average price that overcharges some customers and undercharges others. We don’t blame them, they have a business to run and complicated pricing is usually a barrier to new orders.
Instead, the wine club industry has a novel solution to the problem. For ongoing club members, who use wine clubs to buy much of their wine, they charge shipping. A premium price for a premium service. For gift subscriptions, where pricing needs to be a bit more reliable, it’s safe to assume the shipping prices are both subsidized and accounted for in the wine prices.
The bottom line: wine clubs and online wine stores are rarely making a profit on shipping. If anything it’s a liability. We understand if you need to factor the cost of shipping into your purchase, but you should know the wine clubs aren’t ripping you off.