Uncorked: Where Dollar General will get its wine
May 25, 2011 | 8295 views |  0 comments | 29 29 recommendations | email to a friend | print
With the news of Dollar General’s recently submitted application to sell wine and beer, I expected a plethora of e-mails with proposed names for their wine brands: Peanut Noir, I Can’t Believe It’s Not Vinegar, World Championship of Riesling. These suggested names, among others, circulated when Wal-Mart announced some years ago it would be marketing its own private label wines.

As it turns out, Peanut Noir did not materialize on Wal-Mart shelves — but Lucky Duck, selling for $3.97 per bottle, and Oak Leaf, at $2.77, are now proprietary wine brands for this retail giant. Does Wal-Mart own vineyards? No, but by contractual agreement such giants buy oceans of excess wine from producers and market them at reduced prices.

The Wine Group, one of the largest wine companies in America, produces Wal-Mart’s Oak Leaf brand and likely Lucky Duck, whose bottles indicate these non-vintage wines are sourced from around the globe.

Other retailers offer exclusive brands. Walgreen’s has three: Liberty Creek, South Point and David Stone, selling from $2.99 to $5.99. Liberty Creek and David Stone are likely made by Gallo, but who is David Stone? Inquiring minds want to know.

Trader Joe’s holds the record for the most famous of these private labels, selling tons of Charles Shaw — nicknamed “Two Buck Chuck” — made by the Bronco Wine Company.

Target sells Wine Cubes made by Trinchero Family Estates. 7-Eleven convenience stores have Yosemite Road produced by The Wine Group.

Costco markets private label wines under its Kirkland brand, sourcing wines from around the globe. This includes a true French champagne selling for $19.99 from the Grand Cru house of Janisson & Sons.

Now comes word that Food Network is launching its own wine brand in partnership with Wente Vineyards. The brand “entwine” is scheduled to hit shelves in August with pinot grigio, chardonnay, merlot and cabernet. These wines will retail in the $13 range.

Restaurants also offer private label wines. Maggiano’s, P.F. Chang’s, Legal Seafood, Fleming’s Prime Steakhouses and others have contractual arrangements for wine labels unique to their franchises.

Private labels were once thought to be the domain of low-end wines, but then came the recession. Vineyard owners who sold their fruit exclusively to high-end wineries, along with producers of pricey wines, found themselves swimming in a sea of expensive wine and grape inventories.

Rather than significantly reduce their prices and forever cheapen their brands, high-end producers opted instead to sell off their excess to private labels. The locally popular Unity Hill (now known as Union Hill) came about in this manner.

Hundreds of similar wines sell in the $15 to $20 range; if marketed under their original labels, they would sell for substantially more.

With low-end private brands, it is not particularly difficult to track who makes them. With higher-end stuff, tracking the source is more difficult. Just as high-end producers are reluctant to reduce their prices, they scrupulously take precautions to conceal their identities as sources for some of these private label wines.

When it comes to purchasing private label wines, remember that low-end wines (under $10 per bottle) are made by large industrial wine conglomerates that produce huge amounts of bulk wine. But if you buy bottles in the $10 to $20 range, you will likely secure a premium wine that, before the recession, could only be afforded by the rich and famous.

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