Wine.com Pops Cork on Larger Fulfillment Center

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Wine.com by eVineyard opened a larger fulfillment center in Napa, CA, yesterday to handle a fourfold increase in orders since the company picked up the www.wine.com URL from a defunct competitor in July.


The online wine retailer expanded the facility from 10,000 square feet to 26,000 square feet. Furthermore, the company next week will move from a 5,000-square-foot facility to a 7,000-square-foot center in Portland, OR.


The expansions also were done in preparation for the holidays. Wine.com by eVineyard expects order volume to rise in the coming months not only because the holidays represent its busiest time of year, but because it is the only major wine e-tailer to endure the dot-com shakeout.


The privately held firm would not divulge revenue expectations for the coming months. However, analysts last year estimated that the retailer brought in around $410,000 monthly. In addition, the company is using the 400,000-customer database it acquired from the original wine.com to capture some of the $25 million-plus the defunct dot-com made in 2000.


Wine.com by eVineyard also has invested in new binning software at both fulfillment locations to increase back-end efficiency. . In a move to enhance order accuracy, the retailer has appointed a veteran warehouse employee to sort wines as they come in from wholesalers and assign them to marked bins for that day's orders. The change is designed to allow seasonal workers to pick & pack orders by going to the marked bins instead of having to know variations of wines and their labels.


"That way the temp workers don't have to be educated about wines while still getting the orders correct," said Brett Lauter, vice president and chief marketing officer at wine.com by eVineyard. "Distinguishing the difference between certain Italian and French wines can be difficult."


Because of the increase in orders, the firm's order-delivery time has lengthened from 2.5 days to 3.5 days.


"We have not been hitting where we want to be and where consumers expect for a delivery date," Lauter said. "It wasn't like a merger where we had time to prepare. One day we had competition, the next day we didn't."


Wine.com by eVineyard plans to keep its online marketing frugal during the holidays, though it will continue with ongoing cost-per-acquisition affiliate marketing programs with sites targeted at adults such as Greatergood.com, Schoolpop.com and USAToday.com.


The e-tail firm, which delivers wine in 27 states and nonalcoholic wine nationwide, also will orchestrate partner e-mail campaigns with E-centives, Coolsavings, Omaha Steaks and Harry & David. Wine.com by eVineyard will make offers in those retailers' campaigns and vice versa.


While expressing sadness concerning the events of Sept. 11, Lauter said that the continuing terrorism threat facing the country might inadvertently help his firm's holiday sales.


"I think there will be a positive effect because people probably won't be flying as much and staying home more," he said. "They will have more time to drink wine. They will also likely want to send wine gifts to people they'd normally travel to see."


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