Private label won't last: Treasury Wine

Authentic wine brands will move back to the forefront of retail as the current cycle of wine oversupply nears its end, according to Treasury Wine Estates CEO David Dearie.

Following his Amcham speech last week, an audience member asked Dearie whether Treasury's brands are under threat from Australian retailers' increasing reliance on private label wine.

"I think the retailers rightly have taken advantage of the excess supply situation and produced private labels, but I do think that's what they are – they're labels," Dearie responded.

He said the wine business goes through about 15 or 20 year cycles. 

"You have eight to 10 years of oversupply, a period of balance, and then eight to 10 years of undersupply."

"As we start to enter in to the global balance of shortage situation, then the supply of private labels to the retailers will slow down and brands will become much more to the forefront," Dearie said.

He said that about 59 per cent of branded bottled wine sales in Australia come from just 20 wine brands. 

"Wine brands are incredibly important," Dearie said.

"The retailers here are powerful and it's up to all of us to go out and choose our favourite brands."

Source: The Shout, 3 December 2012