Untapped: How grocers are growing their private label alcohol assortment

Nestled among the golden hills of California, Oliver’s Markets has capitalized on its location by offering private label wines sourced from the famous Sonoma County wine country. Now, the grocer is looking to expand its private label selection by turning its attention to the South of France, Richard Williams, the company's wine buyer, said.

While the plans hit setbacks due to novel coronavirus pandemic and U.S. tariffs imposed this year on French goods, the grocer isn’t giving up its hopes of bringing exclusive French wine to its shelves. 

“The hope is to have it up and running next year,” Williams wrote in an email. 

Oliver’s is among a collection of grocers looking to ramp up their private label alcohol selection. A couple of factors, according to retail experts, make now the perfect time to pour more resources into the opportunity. 

The grocery channel has seen alcohol sales boom during the pandemic as state and country restrictions continue to loosen up, allowing retailers to sell alcohol in areas where they weren't able to before. The pandemic-induced e-commerce boost and economic recession mean grocers are now reaching many price-conscious shoppers that private label usually targets. 

Analysts at IRI and Rabobank said that private label makes up a very small percentage of an alcohol market that's driven by prestige labels and local favorites.