Private label wines a winner for IBA

A revamp of IBA's private label wine range has reaped 13 medals for Metcash's liquor division.

The wines have recently taken out a Gold, two Silver and 12 Bronze medals at domestic and international wine shows.

"When our Two Truths Sauvignon Blanc picked up a Bronze at the Queensland Royal Wine Show we were all pretty buzzed as it was the first time we had ever entered a wine into a show," said Joel Zamek, Merchandise & Promotions Manager IBA (pictured below). "So we were all a bit nervous about how it would go, but seeing its scores and comparing it to some fantastic branded wines was validation that we are on the right track."

That first win has been followed by IBA's Kamana Sauvignon Blanc taking out a Gold medal at the China Wine and Spirits Awards.

"It was the first Gold medal for our portfolio of private label wines," Zamek added. "That was pretty special."

At IBA's annual conference at Sydney’s Hyatt Regency last week, IBA interim CEO Rod Pritchard told attendees that one of the biggest value growth proposition opportunities for retailers is in the wine category.

He added that private label was key to IBA being future fit, as it offered category profitability in both volume and value growth.

"The brands have been built with shopper in mind and focus on delivering exceptional quality, but more importantly increased margin and profitability," he said. 

Zamek added that it was important to strike the right balance between quality and value with private label wines.

"It’s definitely a tricky balance," he said. "The easy option is to cut corners and throw a load of cheap wines into the market and see what sticks, but shoppers are pretty dialled in these days and you can only burn people once. And that’s not the way to treat consumers, as they all have a lot of shopping options these days. We definitely take the approach of making sure what we do over delivers on quality for the price.

"Value is the key component to all private label offerings a $10 wine needs to look and drink like a $15 bottle to get people in and keep them coming back."

He said private label wines will play a growing role in the future of IBA.

"While we compete in a landscape where chain retailers have well over 30% share of their wine sales coming from private label wines, we need a strong offer for our retailers so they can add more margin into their business to ensure they are viable business long in to the future," he explained. "We have strong relationships with our branded suppliers and as it stands today only around 7% of IBA’s wines sales come from private label wines and while we are not looking to replicate the share percentage that the chains have in private label, we can definitely double our sales of private label and still have plenty of room in our wine category for a strong branded offering as well." 

Zamek said the feedback from retailers to private label had been very positive, with the company "blown away by the support of our retailers and the quality of execution delivered by the network."

"Any initiative in independent retail can only be as good as the execution of its retailers, so we are really lucky to have the best retailers in the market who are passionate about their stores, shoppers and local communities," he added.  

The secret to getting the right private label partner

Among the winemakers who collaborate with IBA on private label are Brancott Estate with its Terroir Series, McGuigan's Reserve, Winemaker's Choice and The Wine Maker's Cut ranges, Brand's Laira's Barrelman and Wynn's Coonawarra's The Banker. 

Other ranges on offer include Kamana, Stolen Block, St Augustus and Ruffled Feather. 

"We work with our sourcing partners at KTC [Kollaras Trading Company] who have a strong network of suppliers that provide private label options for us, we have also partnered with branded partners in this space as well, it really just comes down to the strength of the offer, it’s a highly competitive space and anyone able to provide quality juice with the right margin delivery for our retailers is an option for us," Zamek said. 

"Our wine category team here do the work in identifying market segments that would be suitable for a private label offer, we then brief our sourcing partners at KTC and they go to work finding parcels of wine and building brand imagery that will suit the brief, the team then work through numerous samples and land on the best value offering."