Eli Greenblat
June 7, 2012
The Age
Ross Brown believes retailers are threatening the wine industry.
THE former boss of 120-year-old winery Brown Brothers, Ross Brown, has used an industry function to launch a spray against the nation’s leading retailers for flooding their stores with private-label wines that he said were hollow, copycats and masquerading as real brands.
Speaking as chairman of Australia’s First Families of Wine, a grouping of 12 iconic family-owned wineries, Mr Brown said liquor outlets were crowding out quality Australian wines with private-label offerings.
At the First Families event this week, Mr Brown was reported to have said the retailers – he is believed not to have named Woolworths and Coles – were buying up surplus wine and placing a label on it to suggest to shoppers a wine of higher value.
Mr Brown told BusinessDay yesterday that some people thought wine labels invented overnight were brands.
”I call them hollow logs, because they masquerade as brands but in fact they are just a label, which has none of these values that traditional family wine companies bring to the market and really give the aspiration and values to what quality wine is all about.”
He said there was a threat of crowding out wine companies that had made wines interesting and valuable. If private labels were allowed to dominate, it would disenfranchise traditional wine companies, threatening the industry’s future.
These private label wines did not show any innovation or leadership, he said.
”There is nothing new or different coming out of that wine space, it’s all wines that have been developed by the serious wine producers and then copied.
”That’s why I say that, without recognising traditional serious family businesses who invest in this business, they [retailers] think they can just stick on a label and flog it off – off the back of all that hard work. It’s not going to develop a wine industry that’s very serious in the future, and will just turn wine into a commodity.”
Last year Darren De Bortoli, the boss of De Bortoli Wines claimed there was less shelf space for branded wines at the same time as supermarket home-brand labels were being discounted.
Both supermarket giants have developed a portfolio of popular and cheap private-label wines, with the category one of the fastest-growing alcohol segments for the nation’s biggest retailer, Woolworths. Many of these wines have also won awards at shows.
Woolworths, which owns Dan Murphy’s, says it carries 6130 domestic wines, of which only 225 are private-label wines.
A Woolworths spokeswoman said Dan Murphy’s was the biggest buyer of Australian wine in the world and had the largest range of Australian wine in the world.
”We work hard to champion quality local producers, both large and small,” she said. ”Exclusive brands make up a small proportion of our offer and exist to provide a point of difference versus competitors and additional value for consumers. They are produced by winemakers in exactly the same way as any other brand.”
A spokesman for Coles said customers were the driving force in the market.
”As with our supermarket private-label offer, our customers will decide what products they want to see on our shelves. Most private-label wine is sold in the entry-level category, where customers are less concerned about brand names and more focused on value.”
He said Coles, which owns Liquorland and Vintage Cellars, was committed to ensuring customers could buy recognised wine brands as well as choose from a range of value-driven private-label wines.
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