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5 October 2005
Sydney
High petrol prices are starting to have an effect on Australians’ food purchasing habits, research company ACNielsen revealed today.
ACNielsen findings, in an extract from its annual Grocery Report to be released in November, show that to accommodate for the increase in petrol prices, Australian consumers appear to be suppressing their spending habits when it comes to discretionary purchases, and this is particularly noticeable in the areas of takeaway and café/restaurant food retailing.
The average price of unleaded petrol in the Sydney metropolitan area reached 128.5 cents per litre in September, resulting in consumers now paying an additional $10-$20 for a tank of fuel.
The café/restaurants sector had been enjoying turnover growth rates as high as 23.5 percent during the first quarter of 2004, but plummeted to a low -9.2 percent in the first quarter of 2005. The takeaway sector has also been negatively impacted, albeit not as severely. In the first quarter of 2004, takeaway food retailing recorded turnover growth rates of 13.2 percent, but has since dropped to 2.4 percent in the second quarter of this year.
With Australian consumers curtailing their out-of-home food consumption, supermarkets are reaping the benefits through strong growth in in-home food consumption (supermarket dry grocery growth), as consumers increasingly opt to stay home to eat.
ACNielsen data shows that dry grocery growth was marginal at one percent in the second quarter of 2004, but has since improved and reached over four percent during the first quarter of 2005 – at the same time as total out-of-home food consumption reached its lowest point of decline at -six percent.
Merchandise sales in the petrol and convenience channel also appear to be negatively impacted by the increase in petrol prices. According to ACNielsen data (Chart 1), the growth in merchandise sales for service stations was 6.5 percent in March this year, but had fallen to below two percent in September, as the average price of unleaded petrol reached its highest point at 128.5 cents per litre.
“Whilst growth in the grocery channel appears to keep up rather well in light of rising petrol prices, it appears that merchandise sales in the convenience channel may be suffering” says Anton Van Den Berg, Director of Client Service, Retail, ACNielsen Australia. “In other words, because people now have to fork out $60-$70, instead of $40-$50 for a tank of petrol, it’s the can of soft drink or the chocolate bar that may be sacrificed.”
The full ACNielsen Grocery Report will be available for purchase in November 2005. Other topics the report covers include: consumer spending habits in light of the current economic climate; the current private label landscape in Australia (including the impact of Aldi’s entrance); and private label trends around the world.
Chart 1
About ACNielsen
ACNielsen, a VNU business, is the world’s leading marketing information company. Offering services in more than 100 countries, the company provides measurement and analysis of marketplace dynamics and consumer attitudes and behaviour. Clients rely on ACNielsen’s market research, proprietary products, analytical tools and professional service to understand competitive performance, to uncover new opportunities and to raise the profitability of their marketing and sales campaigns
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