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Jun 13, 2012

ROSS BROWN, the former boss of the 120-year-old winery Brown Brothers, has attacked 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 the chairman of Australia's First Families of Wine, a grouping of 12 eminent family-owned wineries, Mr Brown said liquor outlets were crowding out quality Australian wines with private-label offerings.

At a First Families function this week, Mr Brown was reported to have said the retailers - he is understood not to have named Woolworth's and Coles directly - were buying up surplus wine and then placing a label on it to suggest to shoppers a wine of higher value. He 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,'' Mr Brown said.

He said there was a threat of crowding out wine companies that had made wines interesting and of value. If private labels were allowed to dominate, traditional wine companies would be disenfranchised, threatening the industry's future.

''There is nothing new or different coming out of that [private label] wine space, it's all wines that have been developed by the serious wine producers and then copied,'' Mr Brown said.

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, Woolworth's. Many of these wines have also won awards at shows.

Woolworth's has said the group, which owns Dan Murphy's, carried 6130 domestic wines, of which only 225 were private-label wines - less than 4 per cent. A Woolworth's 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. 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,'' she said.

A spokesman for Coles said the number of private-label wines in their stores had remained ''broadly stable'' over the past two years.

''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 was committed to ensuring customers could buy recognised wine brands as well as choose from a range of value-driven private-label wines.