By James Atkinson

It's not impossible for retail liquor to achieve 10 per cent growth this Christmas, as predicted by IBISWorld, when you consider that sales growth over the last two corresponding periods has been uncharacteristically poor, says Macquarie Group analyst Greg Dring.

While retailers may take some convincing, Dring told TheShout that sales value growth over the last two Christmases had been constrained by price deflation, particularly in the Champagne and beer categories, as a result of more aggressive pricing by the chains and parallel imports.

"And then there was the weather – the last two years have been poor in weather as well," he said.

Dring pointed out that annual excise and real pricing increases could in themselves account for a five per cent increase on last year in value terms.

"The brewers always try and sneak through a price increase on their product that's in addition to the semi-annual excise price increases that roll through their wholesale price lists."

"Then you only need five per cent extra volume [to arrive at 10 per cent] and the last two Decembers have been weak, so you can construct that outcome."

IBISWorld senior industry analyst Naren Sivasailam told TheShout the researcher's predictions rely on data from industry associations and government publications, "primarily the Australian Bureau of Statistics".

"Consumer confidence is now on an 18-month high, and if you look at general retail trends, we're actually experiencing a bit of a resurgence," he said.

"By and large Australians have been spending more towards the latter half of the year."

But Sivasailam reiterated that IBISWorld viewed 'premiumisation' as being the main driver of Christmas sales growth.

"It's more craft beers, it's more European-style beers, it's more ciders that have about a 10 or 15 per cent higher value than your traditional beer, wine and spirits," he said.

"So that was one of the things that was factored into the forecast."

The Shout Team

The leading online news service for Australia's beer, wine, spirits and hospitality industries.

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