10 essential questions for your beverage alcohol e-commerce compliance partner

1. Are compliance checks done in real time?
   Compliance checks must happen in real time to ensure a smooth transaction for the customer, and to provide a safety net for yourself. This begins with precise age verification. It's essential to confirm that only adults of legal drinking age (LDA) can make purchases online. Subsequently, compliance extends to accurately calculating and applying the appropriate tax rates, taking into account the location of the sale and the destination of the order. 

2. Are the compliance rules automatically setup? 
   Producers should not have to worry about managing their own set of tax rates, shipping limits, and pre-purchase age verification as this easily leads to mistakes. Compliance solutions should have a built-in tax rate table, working on 9-digit zip codes, so you feel confident all taxes are correct. 

3. Can states rules be manually bypassed?
   This should be a no brainer, if states rules can be bypassed, you should question how compliant your solution really is. The law is the law. In some applications, it can be easy to turn off quantity limits for a state and forget to turn them back on, leading to overselling, which will subject you to penalties and potentially a loss of license for that state. When a state sets its rules, those rules should be built into your compliance system and should not be manually bypassed. 

4. Are sales tax rates customized for special alcohol rules and are they updated regularly? 
   Sales taxes are voted on and changed throughout the country all the time. Cities, counties, and states are all able to change their tax rates on alcohol. This needs to be reflected in your tax table, or you may be mis-reporting tax to a certain municipality. When tax rates change, your compliance solution should change with them. If a city votes to be a dry city, shipments may have to be stopped going to those cities immediately. Charging sales tax on alcohol is not as easy as just using the general retail rates published by the state. 

5. Are states that prohibit direct sales automatically blocked from having products shipped into them prior to processing? 
   There are US states that strictly prohibit the shipping of wine – Mississippi and Utah. There are additional states that only allow wine shipped if the customer ordered the wine on-site – Delaware, Arkansas, Rhode Island. Several states prohibit the direct shipping of spirits and beer. These states should be fully blocked within your compliance system and not be manually overwritten.  

6. Are special beverage alcohol fees built into transactions rather than set up as special SKUs, such as a transportation fee (CO) or recycling fees (CA)? 
   Colorado released a transportation fee in 2022 and California launched its recycling fees in 2024. These both need to be calculated at checkout and reported to the state. Non-alcohol e-commerce systems such as Shopify and Square will not have these alcohol specific fees built in, and therefore will require manual calculation. The best compliance systems will have alcohol fees built in, along with thought out ways to report the fees.  

7. Are reports provided to file with states yourself? 
   Utilizing an alcohol-focused e-commerce system ensures your data is readily available for automated report generation. Conversely, non-alcohol-specific platforms may not automatically calculate critical metrics like liters sold, potentially increasing compliance reporting errors. 

8. Is report filing included in the services? 
   What’s better than accurate reports? An e-commerce provider that will file compliance reports for you since they already have all the data in the system! Having to use an outside compliance company means greater movement of data, an increased risk of error, and working with yet another vendor. Choose a compliance partner that is also your e-commerce partner. 

9. Is there a late fee guarantee? 
   If you are paying a 3rd party provider to do your filing for you, there should be no late filings, and if there are, your provider should be on the line. Having your e-commerce and compliance under one roof ensures the compliance partner always has the most up to date data and can pull that data at a moment's notice. No more late fees, and your compliance partner should be on the hook for guaranteeing that. 

10. Is there a need to worry about dry zip codes, quantity limits and if the limit is per person or per address etc?
    It is a worry that everyone has. A producer in Florida may not be aware of a changing dry county in Alaska, let alone know how to build that into their e-commerce compliance solution. Your compliance solution should handle this for you, allowing you to sell worry free, at all times. 

Final thoughts

In today's modern economy, establishing a strong online presence is paramount for the success of any business. Yet, navigating through intricate state regulations while maintaining compliance can be daunting. Nonetheless you deserve to feel secure and confident when selecting an e-commerce provider.  

That's where Vinoshipper comes in.  

With Vinoshipper, you can navigate the intricate regulations, ensuring every transaction is conducted in accordance with federal and state compliance rules. And as of 2024, Vinoshipper is the only beverage alcohol e-commerce provider that combines direct sales tools with built-in compliance filing for sales on producers' licenses. 

When choosing an e-commerce provider, don't compromise on compliance. Trust Vinoshipper to provide the comprehensive solution you need to thrive in the beverage alcohol industry. With Vinoshipper, you can confidently embrace the online realm and unlock the full potential of your business.