Christmas food and liquor sales expected to grow

Posted by Andrea Hogan on 13th December 2017

Australians may not have the money for department stores and jewellery this Christmas, but will be instead be turning to food and liquor to get them through the festive season.

According to market researcher, IBISWorld, spending on electronic goods, jewellery and department stores will all be down this Christmas when compared to the 2016 Christmas period.

Australians are however expected to spend 4.2 per cent more on liquor and 2.4 per cent more at the supermarket this Christmas.

IBISWorld analyst, Jason Aravanis, said supermarket spending is predicted to reach AUD $10.1 billion in December 2017.

Despite the big numbers, Aravanis warned it may not actually be all happy holidays for the supermarkets.

“While Christmas is a key period for supermarkets and grocery stores, intense pressure is limiting the margins of most establishments – with fierce competition amongst Woolworths, Coles, and ALDI,” Aravanis said.

“Price deflation across the supermarkets and grocery stores industry is expected to limit the increase in revenue generated during the Christmas period in 2017.

“In addition, consumer spending is expected to be hindered by falling discretionary incomes.”

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Over AUD $1.5 billion is expected to be spent on alcohol this Christmas, representing close to 13.2 per cent of the entire year’s spend on alcohol for Australia.

“The composition of alcohol consumption is expected to differ in comparison to previous holiday periods,” Aravanis said.

“IBISWorld expects average beer consumption per capita to be about 10 litres per person, while wine consumption is expected to be close to 4 litres.

“However, IBISWorld expects beer and wine to account for a smaller share of total alcohol spending, as demand for cider surges by 5.7 per cent over 2017-18.

“In addition, craft beers are expected to account for a greater share of beer consumption, as consumers increasingly favour quality over quantity.”


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