By Deborah Jackson, editor National Liquor News and Beer & Brewer

Earlier this weekTheShout reported that the latest Alcohol Retail Currency Report from Roy Morgan Research had revealed the independents’ share of the market was in decline.

However, in speaking with Gavin Saunders, the CEO of Liquor Marketing Group (LMG), he believes that independent retailers who adapt to meet the needs of consumers, will be successful.

Saunders told TheShout that competition from supermarkets in liquor retailing is not new.

“LMG was formed 40 years ago by a group of hoteliers who identified the competitive challenge of the supermarkets entering the retail liquor market. 

“[They recognised] the need for independents to be better aligned, more efficient, use data and insights to improve overall marketing and retail execution standards to compete. While the market share of the supermarkets has changed, these key objectives remain."

And while the Roy Morgan Research indicates that supermarket-owned chains now account for 72.3 per cent of the total Australian off-premise alcohol retail market, Saunders told TheShout that it is important to consider the data collection method.

“Data for the current report is collected through polling 3,502 Australians over the age of 18 years who have purchased alcohol in the last seven days. As Roy Morgan highlights, accuracy of each report will be impacted by the sample size with a greater margin for error when the sample size is low.”

Roy Morgan market share over time shows that Coles and Woolworths combined have grown by 1.9 per cent over the past four years. While the market share percentages may be impacted by the collection method, the trend of market share growth of 1.9 per cent is more indicative of market conditions.  

When asked how an independent retailer can compete with the big chains, outside of price, Saunders said it’s all about service and adapting to meet your consumers’ needs.

“Independent retailers who adapt their offer to meet the needs of the consumers will be successful,” he said.

“With supermarket groups like Dan Murphy’s and First Choice Liquor focused on price and range, independent retailers need to be competitive in these areas, however there is an opportunity for independents to provide better access, service and experience to the customers. 

“It is important to be competitive on price. While the pricing of the chains is difficult to compete with, a healthy market needs organised and efficient independent retailers to maintain balance and concentration for the long term good of suppliers and consumers.

“Independent retailers are uniquely positioned to be able to provide greater service, easy access and experience to their customers through their ownership and control of the outlets.”

At last year’s LMG Conference, the group highlighted that it was in “the best shape ever”, and that was largely attributed to its successful marketing strategies. 

“We know from industry shopper surveys that Bottlemart and Sip n Save customers are the youngest shoppers, are more likely to shop at our members stores for an occasion or same day consumption, and our catalogues and advertisements have a greater impact in customers choosing our stores than other retailers. 

“LMG uses these insights to meet the needs of these consumers. The offer of Bottlemart and Sip n Save to customers is greater than price and range and includes experiences through activations and the service of each of our members,” he said.

“Independents who control their stores, know their customers and have coordinated marketing and retailing programs provided through independent banner groups have the best opportunity to compete effectively.”

The Shout Team

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

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  1. I agree completely. Independents have an advantage where they can read their local market and move quickly to supply products their customers want. The nationals move slowly and have a generic range of products, i shop at independent to get products not available in national suppliers.

  2. As per Walter Kennard’s post. Yes, Independents have an advantage at meeting local market demand and the ability to offer a better customer experience.
    But,I think retailer compliance programs are beginning to kill off this advantage. The major suppliers and buying groups are using these programs to block new innovative products from minor suppliers making it on the shelves. These programs should be investigated by the Australian Competition and Consumer Commission.

  3. So why do industry factual statistics show the big are getting bigger and the small are getting smaller. Head out of the sand EMU.

  4. I completely disagree. I am an independent liquor retailer and every day I see dodgy back room deals between giant liquor companies and Woolworths who controls more than 70% of the liquor industry in this country.

    These deals are designed to reduce competition in the liquor market which explains why in the last 12 months independent retail liquor sales have dropped by 2% while Woolworths sales have increased by 2%.

    It’s not that the independents are incapable, it’s just they are not given the chance!

  5. Stats say the brick and mortor store sales are loosing ground to online sales ,, a new generation of consummers are using social media for wine tasting recommendations then bypassing the big stores and ordering online,,

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