Tobacconists and Specialised Grocery Retailing in Australia Industry Market Research Report Now Updated by IBISWorld

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Weaker growth in disposable income and a fall in consumer sentiment are anticipated to contribute to declining demand for industry goods. For these reasons, industry research firm IBISWorld has updated its report on Tobacconists and Specialised Grocery Retailing industry in Australia.

IBISWorld Market Research

IBISWorld Market Research

Consumers' focus on health and wellbeing has played a central role in declining demand for confectionery and smallgoods during the past five years.

Operators in the Tobacconists and Specialised Grocery Retailing industry in Australia have endured a challenging trading environment over the five years through 2014-15, with industry revenue expected to rise by an annualised 0.6%. Following the implementation of graphic warning labels and plain packaging in December 2012, spending on cigarettes and tobacco products has trended downwards as a share of household final consumption expenditure. According to IBISWorld industry analyst Lauren Magner, “the introduction of bans on the display of tobacco over this period has also contributed to an overall fall in demand for cigarettes.” Consumers' focus on health and wellbeing has played a central role in declining demand for confectionery and smallgoods during the past five years. As a result, spending has shifted towards emerging segments such as the non-alcoholic beverage segment, which focuses on healthier options such as juices.

Industry sales are estimated to fall by 0.9% to $5.9 billion in 2014-15. This small decline stems from a continued fall in the overall smoking rate in Australia. “Tobacco products make up the largest product segment for the industry, so any movements in this segment affect industry performance,” says Magner. Weaker growth in disposable income and a fall in consumer sentiment are also anticipated to contribute to declining demand for industry goods. Legislation banning tobacco displays in large stores and retail outlets will weaken external competition from supermarkets, as tobacconists (in some states) are exempt from the regulation. Revenue will be supported by several strong-performing retailers such as Pressed Juices and T2, which have enjoyed tremendous growth due to consumers' shift towards healthier lifestyles. The industry exhibits a low level of market share concentration.

Ongoing government campaigns to discourage smoking habits will continue to place downwards pressure on the smoking rate, and dampen demand for tobacco products. Consumer demand for specialised groceries such as smallgoods and confectionery will be supported by growth in disposable income and consumer sentiment, although consumer preferences for healthier foods will undermine this growth. The largest growth potential for the Tobacconists and Specialised Grocery Retailing industry lies in niche segments that specifically cater to health-conscious consumers. These product segments include non-alcoholic beverages and other specialised health foods.

For more information, visit IBISWorld’s Tobacconists and Specialised Grocery Retailing industry in Australia report page.

Industry operators are primarily engaged in retailing tobacco and a range of specialised grocery products including confectionery, non-alcoholic drinks and smallgoods. Products are sourced from wholesalers or direct from manufacturers and are sold via retail outlets to the general public. The industry excludes supermarkets and grocery stores and takeaway food operators.

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IBISWorld industry Report Key Topics

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
International Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Industry Globalisation
Major Companies
Operating Conditions
Capital Intensity
Technology & Systems
Revenue Volatility
Regulation & Policy
Industry Assistance
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.

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Gavin Smith
IBISWorld
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