Australia has been and can continue to be an attractive market for importers of alcoholic beverages, however, due diligence is required to check the suitability and commercial viability of the offering for the local market.
According to the latest Roy Morgan Alcohol Consumption Currency Report:
- In the year to June 2022 a total of 13,603,000 Australians (67.9%) aged 18+ consumed alcohol in an average four-week period.
- The number of Australians drinking wine, beer and spirits reached pandemic highs during 2021, but the short-term boost as people were “locked down” at home has now receded. However, consumption of RTDs (Ready-to-drink) has continued to increase and is now at a record high.
- Wine remains the most popular alcoholic drink and the emerging trends suggest consumption of wine and spirits look set to return to pre-pandemic levels while RTDs, and ‘hard seltzers in particular’ rise in significance and beer consumption continues its long-term decline.
Of note for exporters, the wine and beer segments can be challenging. Beverages that may present the most opportunities for exporters include spirits and RTDs that match the local general trends including a preference for boutique / premium brands that offer an experience and products that are “better” for you.
Key differences for exporters to consider include the following:
- The legal drinking age in Australia is 18 across the country.
- In general, alcoholic products must be sold through a specialised liquor operator and cannot be sold at retailers such as convenience stores, petrol stations etc.
- The retail liquor market is highly concentrated by 3 players who have over 70% market share – Endeavour Group (43.5%), Coles Group (17.1%) and Metcash (10.4%)
- Each State & Territory has different regulations on the types of alcohol that can and can’t be sold, as well as the premises and venues that can sell alcohol.
- There are strict rules in place related to the marketing and packaging of alcoholic beverages. Undesirable and banned drinks include those that encourage “fast consumption”, appeal to minors and/or be confused as non-alcoholic beverages.
- The overall market size is relatively small to the US and shipping costs to and around the country are quite high.
To better to understand the local regulations, taxes, and available sales channels alongside the product categories that offer the most opportunity exporters are encouraged to review the following:
- The local state and territory liquor laws
- Food Standards Australia website for an overview of labelling requirements
- The Ad Standards and the Alcohol Beverages Advertising Code’s Responsible Alcohol Marketing Code.
- The ATO website for details on the Excise Duty Rates
- Key industry publications to keep abreast of trends such as The SHOUT, Drinks Trade