Today’s announcement that Inertia has been developing a comprehensive free compliance tool for wineries is really fantastic news for the industry – and especially so for small producers. That Inertia is also opening the system up so that fulfillment houses (and even point of sales systems located in tasting rooms) can access and use the system is a remarkable and extremely smart move.
The cost and effort that goes into producing a full-fledged compliance engine is extremely high – Inertia cites a figure of $500,000 – but once in place the variable costs of adding new users is pretty close to 0 (though there are compliance upkeep costs, hardware, etc). Kudos to Paul and everyone at Inertia for recognizing that and using their position in the market to benefit not just themselves, but every winery looking to ship out of state in the entire industry.
And how exactly will Inertia benefit from just giving away a $500,000 product? I can think of a few ways. Besides the goodwill and excellent PR they’ll generate from this service, each winery they’re able convince to give their system a try, assuming the experience is a good one, will be much more likely to enter into a relationship with them. And while it remains to be seen exactly how easy the system will be for non-Inertia software to interact with (it should launch later this fall), judging from their press release they’ve made the system open and readily accessible.
If they’re able to capture a large portion of the compliance market, and given that the service is free and open I don’t see why they won’t, Inertia will be the straw that stirs the drink for a growing and extremely important part of the wine business: direct to consumer. Having access to that aggregate data will be very valuable, and I’m sure there are plenty of interesting ways to leverage it. There is real power in free.
The bottom line is: In the future if you want to know about direct, you’ll go to Inertia.