Sovos’ Annual DtC Wine Shipping Report Indicates a Volume Decline While Value Remains Flat

Direct-to-Consumer Wine Shipping Report in collaboration with WineBusiness Analytics shows value of the channel steady at $4.1B despite economic pressures

(ATLANTA) January 30, 2024 – Reflecting inflationary pressures and declines in winery visitation, 2023 brought a 6.5% decrease in year-over-year shipment volume to the direct-to-consumer (DtC) wine shipping channel, according to the latest Direct-to-Consumer Wine Shipping Report from Sovos ShipCompliant and WineBusiness Analytics. ShipCompliant is the beverage alcohol compliance business of global tax compliance technology solution and service provider Sovos.

This is the first time since the report’s inception in 2010 that there has been a decline in shipments for two consecutive years. With an increase in average price per bottle shipped of 7.1%, to $48.35, the channel eked out a 0.1% increase in value over 2022. This change in the average price of a bottle shipped DtC is lower than the increases seen in the past two years.

“Although volume dropped and value was essentially flat in 2023, the DtC shipping channel retained its overall value of $4.1 billion.” said Andrew Adams, Wine Analytics Report editor at WineBusiness Analytics. “The deceleration in average bottle price increases also points to a normalizing channel.”

There were notable regional variances in DtC wine shipping in 2023. Washington State wineries significantly outperformed all other regions, which saw decreases in volume and flat or declining value of DtC wine shipments, notching a 5.5% increase in the volume of shipments and an 11.0% increase in the value of those shipments over 2022.

“The DtC wine shipping channel in 2023 shows the hallmarks of a mature market navigating choppy waters,” said Alice Katwan, president, revenue, Sovos. “While softening, inflationary pressures continued to impact supply chain and pricing for wineries, and more cost-sensitive consumers seemed to drop out of the channel. In fact, what really drove the decline in volume in 2023 was fewer shipments of less expensive wines.”

In 2023, wines with an average price of less than $30 per bottle, which make up just over 43% of the DtC shipping channel, experienced a 12.9% decline shipment volume. Meanwhile, wines priced at $100 or above—comprising less than 10% of the channel—saw a 5.6% increase in shipments. This demonstrates the dynamic of inflation creating outsized impacts on consumers of more modest means while higher-wealth consumers avoid significant impacts from rising prices.

Other notable findings and trends described in the 2024 Direct-to-Consumer Wine Shipping Report include:

The Direct-to-Consumer Wine Shipping Report is an annual collaboration between Sovos ShipCompliant and WineBusiness Analytics, examining shipment trends from wineries to U.S. consumers. The proprietary data included is compiled from an algorithm measuring total DtC shipments based on millions of anonymous direct shipping transactions filtered through the ShipCompliant system and paired with WineBusiness Analytics’ comprehensive data on U.S. wineries, resulting in the most accurate depiction of the DtC wine shipping market.

To download the full Direct-to-Consumer Wine Shipping Report, visit dtcreport.com.

  
About Sovos 
Sovos is a global provider of tax, compliance and trust solutions and services that enable businesses to navigate an increasingly regulated world with true confidence. Purpose-built for always-on compliance capabilities, our scalable IT-driven solutions meet the demands of an evolving and complex global regulatory landscape. Sovos’ cloud-based software platform provides an unparalleled level of integration with business applications and government compliance processes.

More than 100,000 customers in 100+ countries – including half the Fortune 500 – trust Sovos for their compliance needs. Sovos annually processes more than three billion transactions across 19,000 global tax jurisdictions. Bolstered by a robust partner program more than 400 strong, Sovos brings to bear an unrivaled global network for companies across industries and geographies. Founded in 1979, Sovos has operations across the Americas and Europe, and is owned by Hg and TA Associates. For more information, visit  http://www.sovos.com and follow us on LinkedIn and  Twitter.

Sovos ShipCompliant has been the leader in automated alcohol beverage compliance tools for more than 15 years, providing a full suite of cloud-based solutions to wineries, breweries, distilleries, importers, distributors and retailers to ensure they meet all federal and state regulations for direct-to-consumer and three-tier distribution. ShipCompliant’s solutions reduce risk, lessen the burden of compliance, accelerate bringing products to market and enable revenue growth. With 60+ partner integrations, Sovos ShipCompliant leads a robust ecosystem of technology partnerships, enabling powerful complementary solutions. For more information, visit https://www.sovos.com/shipcompliant/ and follow us on LinkedIn and Twitter.

About WineBusiness Analytics 
The WineBusiness Analytics team maintains the wine industry’s most accurate databases and provides data-driven analysis, data, insights and reports to help clients grow and manage their businesses. For more information visit www.winebusinessanalytics.com.
  
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