Americans are drinking more wine on-premise and are more knowledgeable about it—two trends that are spurring interest in private-label bottles. In 2013, wine volume nationwide jumped by 1.5 million cases to 297 million, according to the Wine Market Council. Much of that elbow action is in restaurants and bars, with some 60 percent of patrons ordering wine once a month or more, Technomic’s 2013 BarTab reports.
Some operators are trying to capitalize on that popularity by showcasing exclusive wines produced for the restaurant and sporting its logo. Private-label bottles, say a number of operators, are a competitive point of difference, something unique to offer guests and a better value than branded wines. “Private- label wines can allow a restaurant to further define and promote its own brand, bring something truly special to the guest and leverage the resources of a supplier partner,” says Donna Hood Crecca, Technomic senior director.
Since it opened in 2000, The Galaxy Restaurant in Wadsworth, Ohio, has served its own brand of house wines with the proprietary Galaxy label throughout its steakhouse, wine room, sports bar and banquet venues. The operator partners with a California-based wine company. “It’s a novelty; it’s our own label and guests love the wine,” says owner Sean Leatherman. Despite their selection of 50 wines by the glass and over 300 by the bottle, the Galaxy wines are the highest sellers. They go for an average $6 per glass and $24 per bottle, putting them in the lower price range on the list but not the least expensive.
“We sold over 400 cases of Galaxy wine last year,” says Leatherman. The four varietals accounted for roughly 40 percent of wines by the glass and about 22 percent of bottle sales. “They’re better quality than you’d expect in a sports bar, and the expected quality you’d want in a steakhouse and wine room.”
To celebrate its 10th anniversary last year, Matchbox Food Group developed its own red blend to serve in all 10 of its casual restaurants in the Washington, D.C., area. “We also wanted to come up with a wine that would go well with our wood-fired pizzas,” says partner Drew Kim. “My partners and I are all foodies, love wine and beer and have always talked about doing a private-label wine.”
To get started, Kim and his partners turned to an old friend, noted California winemaker Jed Steele, who developed four samples for them to taste. They ordered a pallet of 225 cases of the winner, a 12-varietal blend (mostly zinfandel and syrah) from Lake County in northern California, and designed a celebratory label. Priced at $8 a glass and $28 a bottle, two-thirds of the order has already been sold in the restaurants since late last winter.
“The wine has been a huge hit. We are rifling through it,” says Kim. Part of the popularity is its quality and attractive price point, he notes; it falls into the lower-price section of the wine list. The other factor is exclusivity. “Matchbox Blend is a good value, and you can’t buy this wine at any retail store.”
Leatherman regards the private-label varietals as effective merchandising tools. “We use the wine in promotions around The Galaxy and include the logoed bottles in wine baskets as prizes, gifts or donations,” he says. “Guests who enjoy the wine at lunch or dinner will often buy a case at our retail store to take home.”
At Matchbox Food Group, Kim already is considering adding another private-label wine, as well as a private-label beer from a local brewery and a proprietary bean for its coffee program. “To have private labels on our menu is an awesome value for guests.”