“Any review into liquor licensing must address the existing anti-competitive environment and consider the business and consumer benefits of deregulation.”
The Australasian Association of Convenience Stores (AACS) has supported ACCC calls for a liquor licensing review to open up new avenues of competition and address the unsustainable dominance of the major grocery chains in the packaged alcohol market.
AACS CEO Jeff Rogut welcomed comments from ACCC Chairman Mr Rod Sims reinforcing the importance that retail regulations around liquor licensing, and planning and zoning, don’t have unintended competition consequences.
But Rogut said a review must also recognise the opportunities to improve competition.
“Enabling convenience stores to compete in the packaged alcohol market would open up an important new revenue opportunity for small businesses. There’s no credible business reason our members should be prevented from competing in this space and the emotional case is easily debunked by the fact that liquor is already widely available around the clock from many different outlets,” Rogut said.
“All we are seeking is the right to compete as well. Any review into liquor licensing must address the existing anti-competitive environment and consider the business and consumer benefits of deregulation.”
“Based on the contribution of beer and wine sales to convenience store profitability in the US and UK, enabling our stores to participate in this market would drive well over $500 million in additional sales per year for our industry,” Rogut said.
“Our members were optimistic that the competition policy review would generate a more level playing field in a market worth billions yet dominated by the two majors with their various store formats and brands. Unfortunately, the review was a missed opportunity, one we hope a subsequent focus from the ACCC will address,” Rogut said.
Consumer purchasing habits when it comes to packaged alcohol align perfectly with the convenience store model. When purchasing packaged alcohol, consumers desire convenience and quick service while being influenced by store display, layout and product.
An August-September 2016 survey commissioned by the AACS of 4000 Australian consumers aged 18 years and above showed that 59% of consumers who purchase alcoholic drinks would be likely to do so from their local convenience store if the store was licensed to sell alcohol.
“The benefits to consumers of deregulation are clear. These survey results provide a strong convenience argument for permitting convenience stores to sell packaged alcohol, supporting what is already a strong business case,” Rogut said.
“Not only do retailers stand to benefit from being able to participate in a valuable market, suppliers would have a new avenue to showcase their products, new employment opportunities on both sides would be created, and consumers would benefit from increased competition.”
“Convenience stores around the world are able to participate in the packaged alcohol market. Australia is lagging behind, so a review into liquor licencing presents an opportunity to help our small retailers and our economy at large,” Rogut said.
The AACS has fought for many years to secure the right for convenience stores to stock alcohol and bring our industry in line with the rest of the world. Convenience stores are proven responsible retailers and are willing to operate within an agreed framework in terms of trading hour restrictions, staff training and other compliance requirements.
The AACS has also called on the many beer and wine suppliers squeezed out of the major chain outlets due to their focus on home brands, to work with the convenience industry to increase the pressure on Government and promote a more level playing field.
Inside Small Business