Itsmechang --
The industry that encompasses bars, taverns, nightclubs is large and
shares many of the same concerns globally, such as bans on smoking.
It's part of a larger "hospitality" industry that includes
restaurants, gambling establishments and hotels.
But it's also intensely local, with individual establishments catering
to any sector of society -- from dart-throwers to football teams to
neighborhood groups.
HOW BIG IS THE BUSINESS?
=======================
Starting at the top, the Australian Bureau of Statistics says that
there were slightly more than 4,600 bars, taverns and pubs in the
country in June 2001 -- up 7% from 1998 (the last survey period).
Their gross was $9 billion (AUS), up 13% from 1998 -- and operating
profits were 7.9%.
The same report includes 3,121 hospitality clubs, which generated
income of $6.3 billion and operating margins of 6.1%. Much more
detail -- including the number offering gaming -- is included in the
report:
Australian Bureau of Statistics
"Pubs, Taverns & Bars -- ANZIC Class 5720" (June 26, 2002)
http://www.abs.gov.au/Ausstats/abs@.nsf/0/227fdc4c7eaaf19fca2568a9001393f4?OpenDocument
Historically, according to the trade magazine Australian Liquor
Retailer, beer makes up more than half of sales -- though wine
production and consumption has been growing steadily.
DOMINANT PLAYERS
==================
The industry within Australia is not highly concentrated in chains,
but a report published yesterday by IBISWorld, gives three companies
at least 5% of revenues:
? Australian Leisure & Hospitality Group
? Woolworth's Limited
? Lion Nathan Limited
IBISWorld
"Pubs, Taverns & Bars in Australia" (Jan. 29, 2004)
http://www.ibisworld.com.au/alliance/buschan/industry.asp?industry_id=448
AUSTRALIAN LEISURE & HOSPITALITY GROUP
---------------------------------------
ALH, which is a subsidiary of Foster's Group, is also a public company
in Australia. (ALH is also Foster's largest customer.) Its investor
pages contain quite a bit of detail on operations. The company says
in its Nov. 18-19, 2003 investors' presentation that it's the largest
Australian pub operator -- with 131 pubs in 5 Australian states -- in
"a fragmented industry." Its liquor sales put it at #3 in retail
sales of liquor. It's also the largest electronic game operator, with
almost 6,000 machines:
ALH Group
"Presentation to Macquerie Equities Conference" (Rankin, Nov. 18-19, 2003)
http://www.alhgroup.com.au/investor/media/4
Of the company's $123.7M (AUS) in revenues, 33% come from pub sales;
20% from gaming; and 45% from retail liquor stores (2% from other
categories). However, it's important to note that almost HALF of the
FY2003 profits came from the electronic betting machines.
Among the programs that the company is using to increase revenues is a
loyalty program for customers.
Significant financial details are on the ALH Group investor's
relations page. Particular attention should be paid to the Prospectus
for share offerings in ALH, which has substantially more details,
including a complete list of the 131 pubs:
ALH Group
"Prospectus" (Sept. 19, 2003)
http://www.alhgroup.com.au/investor/media/alhprospectus2003.pdf
WOOLWORTH'S LTD.
------------------------------
Woolworth's size in the liquor trade comes largely due to its Dan
Murphy discount liquor; BWS (beer-wine-spirit) sales; First Estate
wine retail outlets; and MGW operation, which is 50% owned by the
company and consists of both hotel and liquor revenues.
The total number of outlets is 595 and they produce $1.7 billion in
revenue, with the company targeting a 50% increase in the "medium
term", according to presentations at the annual meeting. Woolworth
believes that its market share in liquor retailing is 13%. An
additional 6-12 Dan Murphy stores are planned to open in the coming
year:
Woolworth's Ltd.
"Annual Meeting" (Nov. 21, 2003)
http://www.woolworthslimited.com.au/Resources/Files/21-11-2003_c.pdf
There are more links to investor data on the Shareholder Centre site:
"Shareholder Centre"
http://www.woolworthslimited.com.au/shareholdercentre/index2.asp
LION NATHAN
----------------------
This Australian & New Zealand brewer has it's tavern/pub presence in
41 hotels that it owns or manages, as well as in 35 retail stores that
it owns. Significantly, the brewer just announced that it was
reviewing its ownership of the hotel operations, with an eye to
divesting them:
Lion Nathan Ltd.
"Lion Nathan to Review Ownership Options for Victorian Hotel
Portfolio" (Jan. 28, 2004)
http://www.lion-nathan.co.nz/news/corporate/lion+nathan+to+review+ownership+options+for+victorian+hotel+portfolio.htm
Again, more details on the company's operations are available from the
Investor Relations pages:
Lion Nathan Ltd.
"Investor Relations"
http://www.lion-nathan.co.nz/investor+relations/investor+home/index.asp
TREND AND PROMOTIONAL ACTIVITIES
==================================
Worldwide, one of the biggest issues for bar and nightclub managers is
the attempt to get smoking banned. An antismoking group has tried to
monitor the economics of the issue:
American Nonsmokers' Rights Foundation
"Economic Impact Studies Circulated by the Tobacco Industry" (April, 2003)
http://www.no-smoke.org/ti_econ.html
Another worldwide trend is the development of the "sports bar," made
easier in Australia because of the ability to gamble. Read Rating, a
sports book or gambling company, notes the success that one sports bar
had:
Read Rating
"Greg Voted Tops in Australia" (2004)
http://www.readrating.com/successstories/
OTHER RESOURCES
=================
You may find this website, started by a couple that owned a pub, to be
very interesting, as it shows a list of services offered at almost
2,600 pubs in each of the Australian states. In addition, they're
easily contacted and may allow you to pursue formulas that work:
Aussiepubs
Home Page
http://www.aussiepubs.com.au/index.htm
Also, here's what a Melbourne-based researcher, RobertSkelton-GA, writes:
"Locally, I know that some states have put in measures to stop free
drink offers leading to women being attacked (i.e. free drinks for
women only, men pay, women get drunk, get taken advantage of). And in
downtown Melbourne it has become very easily for anyone to open a
hole-in-the-wall niche bar, low fees and easy to get a license. And TV
ads here are not allowed to imply that alcohol leads to sexual
success. And anti-smoking laws are coming in. Restaurants are now
smoke-free, as are pokie venues. I think South Australia is going to
make pubs and clubs smoke-free - so a members-only club could have an
advantage in the future."
This Strategis (a consulting firm) report on the wine industry
includes a number of references to alcohol marketing in Australia that
should be helpful, including contacts for two trade publications,
National Liquor News and Australian Liquor Retailer:
Industry Canada
"Australian Wine Market"
http://strategis.ic.gc.ca/SSG/dd72883e.html
The Illawarra Institute has an even broader list of industry trade
newspapers and magazines:
Ilawarra Institute/Wollongong Campus
"Magazines & Newspapers"
http://www.illawarra.tafensw.edu.au/library/subguides/wollongongsubguides/hospitality%202003.doc
And the Australian Retailers Association (ARA) has a special-interest
group specifically for liquor retailers:
ARA
"Liquor Stores Association -- New South Wales"
http://www.ara.com.au/ARA.394074:LISTRIGHT::pp=NSWHOME,pc=NSWLIQUAR1
And finally, a well-reviewed book that comes up in searches is Roy
Alonzo's "The Upstart Guide to Owning and Managing a Bar or Tavern"
which can be found at Amazon or other booksellers.
---
Smoking in bars & clubs is such a hot issue that it can dominate a
Google search strategy like the following:
Bars + taverns + Australia
Instead, it can be a good idea to drop the term "smoking" if you're
after other data:
Bars + taverns + Australia -smoking
Other search terms:
"Australian Liquor Retailer"
"Australian Leisure & Hospitality Group"
"Lion Nathan Limited"
"Woolworth's Limited"
"bar trends" + Australia
"Australian pubs" + magazine
"National Liquor News" + Australia
If we haven't covered an aspect of the question that's of strong
interest -- or some part of this Google Answer isn't clear, please let
me know before rating the answer.
Best regards,
Omnivorous-GA |
Clarification of Answer by
omnivorous-ga
on
03 Feb 2004 11:53 PST
Itsmechang --
There are two ways to look at promotional programs, though the first
one that I'll mention often gets overlooked.
The first place to look is at VENDOR programs. The following Tulane
University presentation outlines all of the ways that breweries,
distillers -- any manufacturer -- spends their promotional dollars.
It includes some data for the Australian market (point-of-purchase
displays) but really gives you ways to tap into vendors' dollars:
"Objectives of Trade Promotions" (undated)
http://sparky.abf.tulane.edu/mopug/Ppt/clowch10.ppt
The three most-relevant areas for your friend's business to consider are:
* slotting fees. These are promotional dollars paid for a unique
position. They're controversial, as some U.S. states regard them to
be deceptive and even restrict their use in liquor retailing.
However, they're the lifeblood of many retail outlets -- and it's what
pays for end-aisle promotions that you see at supermarkets, drugstores
and even liquor stores. A Google search for "slotting fees" + liquor
will give you some other references.
A former colleague whose family was in the liquor store business
attributed the store's profitability to slotting fees.
* Co-operative advertising. These programs accrue a percentage for
every dollar purchased, usually 2-3%. For a bar or nightclub, it's
likely to administered by a distributor and used for advertising
purposes.
* Co-promotions. Special events at the venue, usually featuring one
brand -- and targeted towards a specific market segment (e.g., men
under age 30 who are rugby fans).
The natural place to look for promotions is at what's created to
attract the target audience. My favorite example is two friends who
opened a bar in Cincinnati. They knew that they wanted to get young
working women into Nickel Rick's because the guys would follow. So,
at the opening they sent a dozen roses to each of the nurses' stations
at every Cincinnati hospital, along with a handwritten invitation. It
was ingenious because the nurses weren't really their target market --
but Ron and Art had thought one step ahead.
Here are a variety of resources developed with the search strategy:
"marketing promotions" + taverns
"marketing promotions" + nightclubs
Bar Marketing
http://www.barmarketing.com/
ClubProfit.com
http://www.clubprofit.com/
Bartender Magazine
http://www.bartender.com/home.htm
Some interesting articles, even if the web design (with flashing pink
banners) is a bit much:
PromotingNightclubs.com
http://www.promotingnightclubs.com/
The Ford Report
http://www.fordmgtsvc.com/
Adams Beverage Group
"Cheers Newsletter"
http://www.beveragenet.net/cheers/2004/0401/
It sometimes helps in brainstorming different ideas to look at
creative ideas, then take a step back to ask, "What are we really
trying to accomplish?" Look at each of the 4 P's of marketing (price,
promotion, position, product) and consider how your club or bar stands
on each against the local competition:
Strategic Marketing Montreal
"Your SWOT Analysis and the Marketing 4 P's" (March, 2000)
http://www.strategicmarketingmontreal.ca/client-centric.htm
Consider also the 5th P -- your presence in the potential customer's
mind. How often are they there? TGI Friday's, an American chain, had
a brass plaque put at one seat on the bar for a friend who was a
frequent imbiber.
How often do they think about coming to your venue? Do they bring in
other customers? (For example, getting the attention of the rugby
team captain should bring the balance of the team each week.)
I hope that these additional resources helped with the promotional issues!
Best regards,
Omnivorous-GA
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