Negotiations, Agreements and Process
Now it’s time to seal a deal. Find out how these processes usually work. What’s negotiable and also learn tips to getting a better deal by understanding the economics of the wine buyers and their different methods:
Managing your payout expectations
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Your wine will almost always be valued according to the lowest prices in the market and the offer you’ll get will likely be as much as 20% below lowest market on straight purchases. Auction and consignments usually have a 15% commission
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Be fully prepared mentally to get less than what you paid for
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If selling peer to peer or online consignment, please be aware that the online buyers expect to get a discount over store prices so factor in your price as being at less that that market price and don’t forget you’ll need to pay 15% commission to the consignment house
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Positive Provenance issues like original wooden cases and direct from winery shipments may improve the offer while negative provenance issues will deflate the offer
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Obscure wine will likely be valued much lower than market prices (if they exist) and in many cases the stores will actually want to pass on them or value them at next to nothing
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Cherry picking: expect almost all stores to attempt to cherry pick your cellar. If you want to sell the entire lot then you can focus on a top number instead of assigning value to each wine line item
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Some stores have elaborate pricing calculators and schemes and some just go by their gut feeling.
Process
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Everything is subject to inspection and inspection almost always results in discrepancies in the stock and/or provenance. All stores will reduce the payout based on the discrepancies, in many cases they’ll offer to send you the wine they don’t want back
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If wine is inspected at your locations it’s highly likely they’ll want to open a few bottles to sample the provenance
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For small collections the buyer will usually ask you to ship the wine to their warehouse for inspections. For large collections there’s a good chance the store will send a specialist
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For a large collection it’s a good idea to ask the buyers to handle the pick, pack and ship process
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There’s advantage for local stores when selling your wine but wine stores will fly specialists for really good wine cellars
Agreement and Terms:
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From our experience a 2 page agreement is typically sufficient along with an appendix that lists all of the wines sold
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Things like down payments are usually negotiable with the straight purchase wine stores and will depend on the size and quality of the collection
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Consignment type stores typically have rigid terms and agreements, however, for high quality cellars they can and do make exceptions
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In Consignment situations it’s unlikely to sell a wine at a price that’s above the low Wine-searcher.com listed prices even if you’re expected to pay a hefty commission
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It’s always a good idea to shop your list to more than one “sell us your wine” store. The more knowledge you have the better offer you’ll get