Newly published research findings from the Australasian Association of Convenience Stores (AACS) underlines the impact the recession has had on the Australian economy, with 40 per cent of survey respondents saying the economic situation negatively impacted on their business.
The convenience sector was upbeat, however, with 100 per cent of respondents expecting business to grow in 2009.
Sales and profit were hit hard in 2008 with increases in sales across the sector slumping to 0.8 per cent, compared to an average increase in merchandise sales of nearly 10 per cent per year from 2004-2007.
Convenience store profit, for the first time since 2005, decreased on average across the sector although, according to research partner Nielsen, the growth of the most profitable product lines in 2008 grew by 2.8 per cent to just over $2.7 billion, a significant drop from the 7.8 per cent profit growth in 2007.
The research also found that 50 per cent of respondents saying they have noticed the impact of the Federal Government stimulus package on their business.
The industry was not positive towards government as a whole, however, with a whopping 63 per cent of respondents disagreeing with the assertion that government (in general) is providing fair support to their business.
“This latter research finding will be driven by a number of factors, with the inconsistency of legislation in regard to the selling of tobacco high up on members’ frustrations,” says new AACS executive director, Sheryle Moon.
“The AACS fully supports government objectives to reduce smoking rates in Australia, particularly among teenagers, however, we would like to work with governments around Australia to ensure that any future tobacco reforms minimise unintended consequences and avoids imposing unnecessary compliance costs on business.
“The current piecemeal approach to tobacco regulation, overly prescriptive requirements and constantly changing laws are imposing unnecessary complexity and compliance costs on business,” said Moon.
“Each state has different legislation in regard to the display and selling of tobacco. This is causing the industry considerable problems in training staff, fitting out stores and logistics. We encourage all governments to adopt a nationally uniform approach.”
She also pointed out that bans on tobacco point of sale bring into play security, theft, OH&S, restocking and speed of customer service issues, all of which impact negatively on the operations and safety of members.
The AACS’ annual State of Industry report, compiled by Nielsen, The Advantage Group and Him! Australia, is based on a sample of over 1900 convenience store outlets and nearly 7000 shoppers.