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Australian Market

Australian Grocery Market Share

Source: Ferrier Hodgson - Ferriers Focus May 2011
from Wesfarmers and Woolworths annual reports 2010, NARGA November 2010 Report, Master Grocers Australia December 2010

Interesting reading:

Market overview

  • A mature market, Australia has one of the most concentrated grocery sectors in the world.
  • Two major grocery chains – Woolworths and Coles - dominate with 80% market share of an industry valued at A$80+ billion. (In the UK, the two major chains Tesco and Sainsbury have 48% and the US equivalent is 20%).
  • In 2001, German discount grocery chain Aldi entered the market, followed by US membership bulk grocery chain Costco in 2009. Their continued expansion will play a major role in the future of supermarket retailing over the next five years.
  • It is estimated that there are over 10,000 small and independent retailers across Australia.
  • With a population of 22.7 million, Australia is significantly smaller in size than the USA and UK, yet has more supermarkets per capita than the US and nearly three times as many as the UK.
  • Supermarket revenues for 2011-12 are expected to post modest growth of 2.5% to A$ 83.7 billion. 2012-13 forecast A$ 85.9 billion. 2016-17 forecast $94 billion.
  • Food and non-alcoholic beverages account for over 17% of total household expenditure. At around 29%, the Australian supermarket and grocery sector is the largest contributor to retail turnover. Food wholesaling represents about 16% of wholesale trade.
  • The prevalence of generic house brands (private label) in Australia is growing - the current market share is about 23% but this is expected to trend towards 30%. Increasing levels of competition between branded and private-label products and changing consumer shopping patterns will create a difficult landscape for operators over the next five years to 2016-17 as supermarket shelf wars intensify. It is anticipated that consumers will demand a broader range of goods and possibly increase expenditure on gourmet or luxury items.

Parallel imports

  • Since 2000, legislation in Australia allows for parallel importing – the importation from another country of non-counterfeit products without the permission of the intellectual property owner.
  • A complex issue in relation to FCMG products, legitimate importers are concerned that goods must comply with Australian regulations for labelling and composition and that consumer safety and enjoyment may be compromised by out of date products and poor storage conditions.
  • Various industry bodies are monitoring the potential damage to consumer confidence and the legitimate importer's investment in advertising, brand building and trade support.

Information on this page is taken from various internet sources and is of a general nature only.

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