E-Tail shakeout continues

The e-tail shake out continued this week with two leading Web wine merchants announcing plans to merge and online home furnishings retailer Living.com filing for bankruptcy.

Napa Valley-based wine.com will team up with WineShopper.com as soon as the agreement – details of which were not released – are hammered out. The consolidated wine seller will use the www.wine.com URL.

Both Wine.com and WineShopper.com offer reviews, news, and information in addition to selling wine. The new company will be able to draw on a wealth of partnerships, including deals with Amazon.com, Wine Spectator, TheWallStreetJournal.com, WineToday.com, Food & Wine, The New York Times Co. on the Web, Wine & Spirits, the Connoisseurs’ Guide to California Wine, TheWeddingChannel.com and OpenTable.com. Amazon.com invested US$30 million in Wineshopper.com earlier this year.

“We intend to leverage our combined resources, management expertise, and established industry relationships to provide the best customer experience in the online wine space,” Bill Newlands, president and CEO of wine.com, who will serve as CEO of the new company, said in a statement.

The outlook is not nearly as sunny for Living.com, though. The Austin, Texas-based furniture and furnishings e-tailer announced Wednesday that it would file for Chapter 7 bankruptcy, and lay off its 275 employees.

“The decision to close our store was an extremely difficult one,” said Shaun Holliday, living.com’s chief executive officer. “We assembled a world class employee team, first rate partners and investors, and top tier suppliers. Our Web site is considered the gold standard in furniture and home furnishings online.

“Despite our employees’ tremendous efforts and the loyalty of our customers, the recent downturn in the capital markets has substantially impaired our ability to raise the capital required to achieve profitability,” CEO Shaun Holliday said in the announcement, posted at www.living.com/release_living.html.