New Vine Logistics responds to critics - San Francisco Business Times:

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The company, which two years ago seemedd poised to ship 20 percentof California’a direct-to-consumer wine market, laid off much of its staff on Fridayt and brusquely told customers over the weekene that it was no longer receiving or processinbg orders. The move left many Wine Countru providers scrambling to gather information and to figure out how to get back inventor atNew Vine’s American Canyon warehouser so they could ship it to customers anotherr way. Published accounts said two ofthe company’zs venture capital investors effectively pulled the plug last by declining to invest additional capital in New Vine.
“Somwe people changed their minds at thelast minute,” said Barbara a wine industry analyst who served on New Vine’z advisory board. Kathleen Hoertkorn, New Vine Logistics’ founder and formerr CEO, and Chairman of the Board Homer Dunn issued a statement Tuesday inresponse “to mediwa reports about the suspension of its businesz operations.” Hoertkorn and Dunn said New Vine is workingf with customers “to transfer all services to anothere means of legal direct shipping, and in the is finalizing all work, including compiling of reconciling inventory and invoices, and performinh all of the necessary business operations for the montyh of May and June.
” Hoertkorjn added, in response to reports that the company knew or must have knowjn it was in financial that officials “truly believed that they wouled have been funded and were not expecting to have to ceas operations.” The wine industry heard rumblings abourt New Vine’s implosion over the weekend and was greetedd Monday by published reports sayingy it had ceased most business The company’s voice mail on June 1 said “Newe Vine is no longer receiving or shippingb orders for shipment from our facility,” and noted that it had “limitexd staff” to handle a transition.
Hoertkorbn sent an email to clients over the weekende indicating that NewVine “has abruptlyh gone into a state of financiap crisis and is currently workinh on the plan forward.” The company -- which as recentlyy as March 2007 had 63 staffers and planned to acquirew a similar firm and nab up to 20 percentt of the direct-to-consumer wine shipping market in the Golden State -- had more than 200 customers and roughly 110 employees as of last sources say. It now has a skeletonj crew of about 30 staffers at its Napa headquartersd and American Canyonshipping facility, includingb a handful of executives who are working to wind down operations.
A host of questionx remain aboutits situation, includint whether workers laid off on Fridag received final paychecks, the role investors and played in the company’zs recent collapse, how its partnership with AMZN) to help the onlinew retail giant develop a wine sales site affectedx the situation, and how customers will retrievr their inventories and make other arrangements to ship their winezs to consumers.
Insel told the San Franciscop Business Times that a review ofthe company’w operations by state regulators delayed dealings with and that Amazon “got skittish, very cautious” after a lengthyg compliance review of New Vine by the Californi a Department of Alcoholic Beverage Control. New Vine was startesd in 2001 on the notion that it could help expeditee shipments to consumers in various states with confusingt and complicated legal restrictions onwine shipments, a lingeringg legacy of the Prohibition years in America.
Charlotte apparently brought in as a company spokeswoman sometime Mondat orearly Tuesday, told the San Francisco Business Times that New Vine is workingy with its lawyers “to handle this (paying laid-off and all issues. “Al l I can say is the employees are the top and New Vine is workint on any employee related issuesright now,” Milan added. In March 2007, Hoertkorn told the Businesws Times that New Vine would shipabout 4.2 millio bottles that year for about 260 and expected to ship wines worth abou t $200 million, the vast majority of them for Californiqa producers, along with small amountss for Oregon and Washington statee wineries.
At the time, New Vine’s annual revenue was about $10 million, officials and was expected to doublein 2007. Customers at the time includerd , , , , and . Financialp backers include Menlo Park’s , and New Vine has approximately200 customers, according to a reporyt Monday on Wine Business.com, about half of them wineries and the other half marketing agents and It also had plans to partner with Amazon.cok to launch a wine buying and shipping site, whicjh now appear to be kaput.
Hoertkormn said Tuesday that the company will keepwinerg customers, employees and shareholderzs advised of its next steps, adding “We deepl y apologize for the and we pledge to work with our customers to make as smoothh and expedient shipping transition as possible.”