Store profits debated as Woolies stymies 1st Choice

By James Atkinson

Woolworths has successfully blocked an application by Coles to relocate a Liquorland store licence, in a legal encounter that included debate between the two retailers on what constitutes a viable retail outlet.

Coles closed the Liquorland store in Athelstone Shopping Centre in Athelstone, Adelaide in September last year and applied to relocate the licence to nearby Newton, where it wanted to establish a First Choice Liquor outlet.

Liquorland Athelstone was a "loss-making store" and the decision not to renew its lease was made independent of the First Choice proposal, according to Coles Liquor national business development manager Curtis Field.

According to Licensing Court of South Australia documents, Field told the court that the Athelstone store's turnover for the 12 months prior to its closure was $1.5 million a year, and it was expected to decline further with a new Dan Murphy's opening in nearby Highbury.

Woolworths, which in addition to the Dan Murphy's Highbury store has two BWS stores in Newton, was among several parties to object to the proposed First Choice Liquor store.

Woolworths national business development manager for liquor licences, Anthony Smith, purportedly told the court that he regarded the turnover stated by Coles as being profitable and he would have kept the Athelstone store.

He said there was definitely still a place for smaller convenience stand-alone bottle shops in shopping centres, and questioned why Coles did not identify where the loss was coming from at Athelstone and improve the range of liquor available and customer service. 

Smith went one further than that, telling the court Woolworths would be interested in acquiring the Liquorland licence particularly as there was already a Woolworths Supermarket in the shopping centre. 

Locals lost out from Liquorland closure: Court

In any case, Judge William Jennings on June 25 found that the proposed First Choice store was not within the locality of the Athelstone Shopping Centre, so the application to move the licence should be dismissed.

In case he was wrong in his ruling on locality, Judge Jennings found the store had failed the public interest test, too. 

He said the closure of the Athelstone store had "significantly disadvantaged" locals who had been denied the capacity of meeting their take away liquor needs as part of their general grocery shopping.

"I have no doubt that Liquorland would be substantially better off commercially in the longer term by the establishment of the First Choice store on the proposed site, rather than its selling the licence or attempting to improve the turnover at the former Liquorland at Athelstone site… [But] That is not the test," Judge Jennings said.

"To allow this application would be to sanction a strategic decision made by the applicant to abandon licensed premises to the detriment of a section of the public to enable it to seek commercial advantages elsewhere."

A Liquorland spokeswoman told TheShout: "We are currently reviewing the decision and considering our next steps."