I once found a vintage Dom Perignon Rosé being sold online by a private collector for less than $350 per bottle. Since this is a wine that normally sells for at least $100 more, I was skeptical. Sure enough, after I added the wine to my virtual shopping cart and entered in my payment information, I was hit with a number of unexpected fees. The seller not only charged the usual taxes, but added almost $100 worth of additional handling fees. He also charged twice as much for shipping as I expected—for a single bottle of wine, he wanted to charge me $90 to have it shipped overnight. At the end, the $350 bottle became a $530 bottle, so I decided not to invest.
If you plan on selling your wine, you need to know how to include extra fees without making your buyer feel duped. Here’s how to calculate and include the tax and shipping costs for wine before you sell.
Think About Your Buyer’s Needs
Most wine collectors realize that they’ll have to pay extra for shipping fees and wine sales taxes. However, including this information early in the buying process can increase the likelihood that your buyer will bid on future bottles you sell. If you cultivate a reputation as a seller who hides the true price of the bottle until the last moment of the sale, you’ll only hurt your future sales. Some sellers, like the one in the story above, will significantly lower the listed value of the wine in order to get buyers interested in it, then bring the price back up to full retail value using a series of handling fees and other miscellaneous charges. It’s better for your buyers and your reputation to list your wine at its accurate value from the beginning, and have a transparent system for calculating additional costs, like shipping and taxes.
Use Retailers That Include Tax and Shipping Costs for Wine
Unfortunately, it’s impossible to calculate tax and shipping costs for wine before your buyer bids on the bottle. State wine taxes and laws vary depending on where you and your buyer live, and shipping costs also differ depending on how far your bottle needs to travel. This is why it’s essential to use a retailer who handles shipping fees and taxes for you. Online retailers with warehouses located in wine-friendly states, like California, can ship to many states in the country, and only charge their buyers a relatively small fee for the service. Here at Vinfolio, we even have an estimated shipping calculator that you or your buyer can use before selling or bidding on any bottles.
You can also use this calculator to keep other sellers honest. I recommend using this tool whenever you suspect that a shipping fee has been padded by the seller by comparing shipping costs to find the best sales price. For instance, shipping one bottle of Champagne to my home from Vinfolio’s warehouse costs anywhere from $20 for basic ground shipping to $40 for overnight shipping that arrives the next morning. This is much more reasonable than the $90 shipping fee on the privately-sold bottle of Moet & Chandon I was eyeing.
All-In Price and Bottle Value Aren’t the Same
Let’s say you pay shipping fees and taxes on your bottles, and you want to resell them later. Should you include the overhead, all-in cost of the wine when you list it online, or should you stick with the actual bottle value? Listing the full, all-in price of your wine will ensure that you know how much profit you’re making on each bottle when you resell. However, the risk is that you’ll artificially pad the value of that bottle, making it harder to sell it later, and driving up the price of that vintage on the market. Listing just the value of your bottle, without shipping or taxes, gives you a more accurate sense of its worth.
The biggest problem I’ve seen with all-in price listings is that they make the bottles appear more expensive than they actually are. The actual value of a bottle of 2015 Haut-Brion is about $800. If you pay $60 in overseas shipping fees, plus state taxes, and additional storage costs, your $800 bottle could easily become a $900+ investment. However, if you list the price of your bottle online at $900, you pad the actual value of that bottle. Another seller might see your $900 price and believe it is the true value of the wine, then charge additional shipping or tax fees on top of that listed price. This results in Haut-Brion bottles that cost about $100 more than they normally would.
What to Do Instead
Use a combination of all-in value and real value when you list your bottles online in order to make an apples-to-apples comparison. You can use a private bottle tracking account, like VinCellar or a spreadsheet, to make a note of the all-in price you paid for the bottle, taxes and shipping included. When you decide to sell your bottles later, simply look at this note to find out whether you’ll remain in the green when you sell the bottle. If your all-in investment costs are higher than the bottle’s real value, wait until the bottle increases in value before you resell.
If you’re listing the price of your bottle in a public forum, especially on websites used to track average bottle value, only list the cost of the wine without shipping or tax included. To start, taxes and shipping costs vary, so they aren’t that useful for your fellow collectors to know. This also keeps wine prices honest. When in doubt, keep a detailed list of the fees you paid for your wine, and make it clear to your buyers and peers how you arrived at your bottle’s price.
Whether you are starting your high-end wine collection or adding to an established portfolio, Vinfolio is your partner in buying, selling, and professional storage. Contact us today to get access to the world’s best wine.