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Background

Since the end of prohibition in 1933, and the creation of the 21st amendment, the US wine trade has operated through a three tier system. Producers/Importers sell to Wholesalers who sell to Retailers who sell to the general public. Along the way each group takes their cut, so that by the time the wine is sold to the public it is about 100% more costly than it was at the start of the chain.

Each state has different laws in the way that wine can be transported to it, and who can do so. A typical chain is for a US winery (say in California) to sell to a wholesaler who ships the wine to the east coast and sells it to a retailer (say in New York) who sells it to the public. Alternatively an importer buys the wine (say in Bordeaux) brings it into the country, and then sells it to a wholesaler who then sells it to a retailer (say in New York). The retailer is then able to sell the wine to anyone in New York state, but is not allowed to sell and ship it directly to the public in other states.

An individual is also not allowed to buy the wine in New York and put it in the trunk of their car and then travel across a state boundary. This Byzantine bureaucracy has meant that it is impossible to work out what is legal and who can do what. It has also led to a lot of Winevestors becoming lawbreakers as, inadvertently or not, they try and acquire their hard-to-find wine.

The ability to ship wine is especially important for a Winevestor. Some states are well stocked with established wine retailers of long heritage who have sold Futures for decades and can offer their clients IGW at good prices. Others have few wine retailers, or state monopolies where the Winevestor can only obtain what the state wants to sell. It is hard to be an effective Winevestor in this second category of states. The issue is exacerbated when it comes to selling the wine investment. Typically wine is sold through an auction house, which are mainly situated in the following states: California, New York, Illinois. Luckily the online auction sites now give another channel, although these too mean that the wine has to be shipped to the online auction site.
 
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