Independent Retailer - March 2018

ISSUE 2 | MARCH 2018

YOUR INDUSTRY NEWS PROVIDED BY MGA INDEPENDENT RETAILERS

ROMEO’S FOODLAND MCLAREN VALE SOUTH AUSTRALIA – BEST GLOBAL RETAILER OF THE YEAR

2018 TRAINING GUIDE INSIDE!

National Support Office

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1800 888 479

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Ask your customers to press or to get cash out and avoid ATM fees.

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OUR MISSION The mission of MGA Independent Retailers is to deliver the best possible industry specific business support services to independent grocery, liquor, hardware and associate store members.

MGA NATIONAL

SUPPORT OFFICE Suite 5, 1 Milton Parade, Malvern, Victoria, 3144 P: 03 9824 4111 • F: 03 9824 4022 admin@mga.asn.au www.mga.asn.au Freecall: 1800 888 479

RETAILER DIRECTORS Rodney Allen (President) – Victoria Graeme Gough – New South Wales Michael Daly – Victoria Gino Divitini – Western Australia Grant Hinchcliffe – Tasmania Carmel Goldsmith – New South Wales Chris dos Santos – South Australia Debbie Smith – Queensland

MGA CHIEF EXECUTIVE OFFICER Jos de Bruin 03 9824 4111 E: jos.debruin@mga.asn.au

CORPORATE PARTNERSHIP AND MEDIA SALES Steve Sellars 0407 399 240 E: steve.sellars@mga.asn.au

EDITORIAL AND PRODUCTION

E: courtenay.hirst@mga.asn.au

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CONTENTS 5 CEO welcome

INDUSTRY NEWS 6 QLD misleading petrol price ban 6 MGA Board of Directors meet in WA 7 Combating illicit tobacco 7 Foodland South Australia can feel very proud 8 Romeo’s Foodland Maclaren Vale – IGA Global International Store of the Year 9 Cyber Security: Understanding the threat and defending your business 11 A new Nationals leader – a new beginning 11 MGA WA Government meetings 12 MGA WA Industry Business Breakfast 13 MGAQ committee meeting 14 Rod Sims Chairman ACCC - Extracts 2018 compliance and enforcements speech 15 Farmer Jacks supermarket, Gwelup WA 16 IGA Queensland & Northern NSW State Awards 19 Ritchies Group supplier update 19 Vale – Rob Thomas WA 19 Campaign to reduce company tax 20 Public, private or hybrid cloud; Which option is right for you?

21 Farmer Jacks supermarket, Currambine WA 22 Merchant payment costs and least-cost routine

LEGAL AND HR 23 Long service leave and transfer of business 23 Dealing with staff register problems 24 Make sure that your wage payment details are compliant 25 When is superannuation payable?

25 Addressing sexual harassment in the workplace

LIQUOR NEWS 27 MGA welcomes new Victorian members 30 Independent liquor store operator leads innovation in competitive market 31 Drinkwise to strengthen responsible drinking campaign 32 Cocktails rise and shine, while beer and wine sales slip 33 Gin sales hit record high 33 WA Government amendments to the Liquor Control Act to restrict liquor barns to 400 square metres

35 Penfolds and Squealing Pig take out top awards at the Best Wine of the World competition

TRAINING 37 The importance of safety training in the supermarket 37 Young people in the workplace

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CEO REPORT

CEO WELCOME Welcome to MGA’s second edition of the Independent Retailer for 2018.

The 2018 year has commenced at a rapid rate with 2017 a distant memory. The kids are back at school and the everyday fast pace of life and business has returned.

Whilst 2017 was in many respects a turbulent business year for members it was also a litmus test for members resilience in adapting and getting ahead of the changes that have affected them.

By far and way away, rapidly increasing energy prices was the most significant and impactful challenge for members businesses with electricity prices increasing in some cases by 4-fold or more. In fact, electricity prices impacted our independent supermarket sector by increasing more than a $110m between February and October 2017.

Given the very slim margins we operate under and the inability to recover these costs, the only lever to release the cost pressure valve is to reduce staff numbers.

If there is no electricity price relief very soon then members are at risk of releasing more than 2,000 staff members.

The talk fest is over – it’s time the Federal and particularly the State Governments take a stronger approach by stepping in and taking responsibility. Electricity pricing must be capped until adequate electricity supply is secured to satisfy the demand.

MGA will be focusing heavily on driving electricity prices down in 2018.

Australia seems to be in a state of political flux with a plethora of elections being conducted in the past 18 months. MGA encourages governments to be very consultative and proactive in assisting family enterprises and private businesses to be the best they can be. A healthy and prosperous independent business sector drives innovation, employment and drives consumer confidence.

The worst recent example of a state government not consulting and behaving belligerently without taking into consideration the livelihoods of family enterprises and private businesses is the NSW state government in its bid to launch the Container Deposit Scheme on 1 December 2017.

A large proportion of the NSW community has asked why introduce such a scheme – we don’t need it? But still the NSW Government pursued this BADLY thought out and executed public policy.

Consumers, MGA members and retailers have been polarised because of a lack of education and cohesion. Owing to the lack of, and very poorly allocated collection points and their initial favouritism toward the chains, a toxic culture of distrust toward the NSW Government and the relevant “for profit” agencies has emerged.

MGA members are in survival mode and fighting for their very existence in their bid to compete on price and location of collection points with the chains, coping with numerous cross border issues, particularly along the Victorian border and dealing with an uninformed public.

On 13 March 2018, MGA, on behalf of members, lodged its National Wage Review submission to the Fair Work Commission.

Thanks to all members who responded to MGA’s research pertaining to the impact of the hefty 3.4% wage increase last year and the likelihood of another wage increase and the possible effects on business in 2018.

MGA has called for no more than a 1.1% increase in wages. Beyond that, members have indicated they will not employ additional people, in fact if the increase goes beyond 2.0% some members may be forced to review their staffing needs. The unions want a 7.2% increase, clearly they are out of touch and a force determined to raise the cost of living.

Last year the increase was 3.4%. Our industry cannot absorb another increase of this magnitude. MGA will notify members of the outcome of the 2018 National Wage Review in due course.

Finally, congratulations to the Foodland brand in South Australia for achieving top accolades for their brand and importantly, their terrific shopping experience.

Congratulations to the Romeo family for their well-deserved win in Las Vegas earlier this year. Their store Foodland McLaren Vale won the very best International Retailer of the Year!

Until next time – good trading.

Jos de Bruin CEO, MGA Independent Retailers

Visit www.mga.asn.au!

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INDUSTRY NEWS QUEENSLAND

QLD misleading petrol price ban New laws that ban petrol stations from displaying discounted fuel prices have come into effect in QLD. Petrol stations across the state must now post the nondiscounted prices on their price boards.

The laws came into effect on Wednesday January 31.

The QLD Liberal National Party opposition called on the government to do more to drive down fuel prices.

“They simply can’t display a discounted price on their price boards that is only available to some motorists under certain conditions.”

states do it; we’ve seen prices have been driven down because of the outcome from the apps, so let’s get on board” Ms Frecklington said.

Energy Minister Dr Anthony Lynham said the ban was a result of a recommendation from the governments fuel price summit in 2016.

The move was welcomed by opposition leader Deb Frecklington but said real-time monitoring also needed to be introduced.

Despite calls for a compulsory monitoring scheme, the government has instead pointed to existing schemes including websites and mobile apps like MotorMouth.

“Retailers will still be able to offer and promote discounted fuel schemes,” Dr Lynham said.

“We know that competition breeds lower prices, so that is exactly what the LNP is suggesting, We’ve had other

Source: Lucy Marrett in Convenience Retailers

WESTERN AUSTRALIA

MGA Board of Directors meet in WA On the 8 March 2018, MGA Board of Directors met for the first time in Western Australia. MGA‘s board is representative of all member independent supermarket and liquor store operators in all states and territories,

meaning they had to travel, with pleasure, from far and wide to visit the WA. This trip made to WA was a long time in the planning and it did not disappoint. MGA Directors met many MGA WA members and were thrilled to learn about their businesses, the challenges they faced and the exciting plans many operators had for refurbishments.

MGA visited a few stores including Farmer Jacks Currambine, Farmer Jacks Gwelup, IGA The Boulevard City Beach and IGA Como. All supermarkets were outstandingly presented and offered consumers an exceptional shopping experience.

The meeting itself was held in the Karalee Tavern shortly after the MGA WA Industry Business Breakfast.

Back: Chris dos Santos SA, Grant Hinchcliffe TAS, Gino Divitini WA, Jos de Bruin; Front: Rod Allen VIC, Graeme Gough NSW, Debbie Smith QLD, Carmel Goldsmith NSW, Michael Daly VIC

March 2018 – Edition 2

MGA’s board were very grateful to have met and networked with WA members, industry stakeholders and members of parliament to help better understand first hand the issues members are facing in WA.

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INDUSTRY NEWS NATIONAL

SOUTH AUSTRALIA

Combating illicit tobacco MGA has been vigorously encouraging federal and state governments and authorities to do something about the rampant increase in the incidence of Illicit tobacco around Australia.

The Foodland brand in South Australia is going from strength to strength, preparing to open its fifth new store in as many months.

MGA has been engaged in Federal House of Representative Revenue, Finance and Audit Working Committee and the Black Economy Task Force highlighting the impact of illicit tobacco on the Australian Excise budget, as well as the impact on sales affecting MGA members.

In a recent announcement by Minister for Revenue and Finance, Hon Kelly O’Dwyer, news was forthcoming that legislation to create a comprehensive set of offences targeting illicit tobacco was to be introduced into the parliament in late February. This is the first of two bills that together will deliver on the Turnbull Government’s commitment to close down the illicit tobacco market.

Maximum penalties for excise offences will increase to 10 years imprisonment. Courts may impose heavy fines for convictions in relation to offences involving commercial quantities of illicit tobacco, for example up to $2.25 million where the tobacco weighs at least 500 kilograms. The penalties will apply from the day after the bill receives royal assent.

These changes are supported by the Minister for Home Affairs, who will later introduce legislation to amend the Customs Act to strengthen illicit tobacco offences, which will complement the amendments introduced in Parliament.

The Minister for Revenue and Financial Services, the Hon Kelly O’Dwyer MP, said the government is delivering on the 2016 -17 budget commitment to stop the illegal tobacco trade which the Australian Taxation Office has identified as a major revenue source for organised crime.

“Under the current legislation, before charges can be laid under the Excise or Customs Act, the origin of the

Foodland South Australia can feel very proud

The recent Romeos Foodland Mclaren Vale International Retailer of the Year award compliments Foodland’s Canstar Blue award for most satisfied customers it won in 2017.

illegal tobacco seized in Australia has to be proven. As the origin of tobacco cannot be readily determined, this obviously limits the ability to impose penalties even where substantial quantities are involved,” Minister O’Dwyer said. “Furthermore, the current law has inconsistent penalties and limitations on how they can be applied.”

“This measure will ensure that tobacco products imported and consumed domestically are fully taxed and comply with Australian regulations.” The bill provides for new tobacco excise faultbased offences and reasonable suspicion offences that can apply to tobacco.

The penalties take into account the seriousness of the offence and will provide a deterrent to illegal activities.

Once both bills are enacted, the amendments as a whole will ensure there is a comprehensive set of offences aimed at stopping the importation, possession, purchase, sale and production of illicit tobacco. In addition, the bill makes it an offence to possess equipment used in the production of illicit tobacco.

Foodland Chief Executive Officer Con Sciacca said: “McLaren Vale Foodland and the Romeo family deserve congratulations. Not only are they fully committed to servicing the local community, they listen to their customers and ensure they provide the best retail environment.

This customer centric approach is one each and every Foodland store takes great pride in.” Mr. Sciacca added; “This award further fortifies the fact that South Australian retailers and stores are some of the very best in the World.”

Foodland is an iconic brand is South Australia, with a 96% awareness rate, over 100 stores and the highest market share for independent supermarkets in Australia. Employing over 9,000 South Australians, Foodland is determined to increase its share of the market in South Australia by continuing to provide service and value to every South Australian.

Congratulations to the entire Foodland team and all Foodland retailers – achievements such as these only come from a deep commitment and dedication to delighting customers – everyday.

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INDUSTRY NEWS SOUTH AUSTRALIA

Romeo’s McLaren Vale Foodland

Paul, Joseph, Elizabeth, Anthony and Antonio Romeo

Romeo’s McLaren Vale Foodland at the international awards in Las Vegas

Romeo’s Foodland Maclaren Vale – IGA Global International Store of the Year In February this year, South Australian supermarket McLaren Vale Foodland was awarded the International Retailer of the Year at the 2018 IGA global rally held in Las Vegas.

It comes less than 12 months after the same store took out the Australian title for best store.

McLaren Vale Foodland is owned and operated by the Romeo family who have previously won the award in 2002 (North Adelaide Foodland) and 2009 (Mitcham Foodland).

The international award, previously held

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by Frewville Foodland in 2016 and 2017, was awarded to the McLaren Vale store due to its high-quality retail offer. From its collection of gourmet cheeses, in-house sushi bar and emphasis on local food, McLaren Vale Foodland has its customers and their needs front of mind.

be announced as the 2018 International Retailer of the Year.

McLaren Vale Foodland itself is a new venture for the Romeo family, having opened the store in 2016. During this time, it has built momentum to be one of the premier supermarkets south of Adelaide.

This amazing store is set in the beautiful town of McLaren Vale and showcases all things South Australia. We have specifically highlighted local food and produce from within the McLaren Vale region. This award would not be possible without all of the tireless and incredible work from our loyal staff, who have done an amazing job in presenting this store to the highest standards day in and day out.

Store co-owner, Anthony Romeo said; “As a proud South Australian family owned business, we are extremely honoured to

Congratulations to the Romeo family and their staff for producing yet another unique shopping experience for their customers.

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INDUSTRY NEWS NATIONAL

Cyber Security: Understanding the threat and defending your business MGA encourages all members to be completely vigilant when it comes to cyber security. In speaking with members across the country we find a very high level of complacency by members toward taking cyber security seriously. The analogy may be that in this day and age you wouldn’t leave your house without locking it in case of break ins – why would you leave your business in a completely vulnerable state and at risk of cyber crime that could shut down your business?

How cyber criminals are targeting your business Cyber criminals have an armoury of tools at their disposal: ransomware, credential phishing, banking malware, business email compromise, known vulnerability exploitation, watering hole attacks, zero day exploitation and distributed denial of service.

To deploy these tools they search for a weakness in the security of a member’s business operations. This may be pre-existing – as a known vulnerability in a system that the business uses – or it may be created by exploiting human factors, often by using a combination of surveillance and psychology. But whatever the method, if criminals find it too time consuming and expensive to hack into your business, they will look elsewhere for easier targets.

Awareness among employees is a first line of defence that should be coupled with ironclad verification protocols.

Using business email compromise as an example, employees need to understand that demands for money transfers can be from imposters using known identities, via emails that look authentic, using invoices that pay to similar-looking but fraudulent bank accounts; or who are leveraging information about securities or assets.

Defending your business Effective threat detection depends on

establishing systems, processes and methodologies that enable you to systematically check and protect the security of your sensitive data. Routine defensive policies and procedures need to be carried out by competent personnel.

Any effective risk management policy must necessarily include techniques for identifying risks and contextualising their significance to your operations; what other aspects of your business and those of external business partners they interface with; and finally, what the response needs to be based on this knowledge.

Telstra’s five knows of cyber security, listed below, are a useful starting point for cyber risk assessment.

• Know the value of your data; • Know who has access to your data, both internally and externally, and whether they should continue to have access; • Know where your data is; • Know who is protecting your data; • Know how well your data is protected.

Tools and reporting Once the areas of an operation have been prioritised for security focus, a framework is required: a platform or set of standards that best meets your businessl needs. The identity of who will be involved and how they are to monitor the security activities of your business must be documented.

Companies that do business with partners in other jurisdictions need to observe compliance with their directives, such as those specified in the GDPR. Those involved with processing card payments need a framework that meets the Payment Card Industry Data Security Standard (PCIDSS).

ISO 27001 certification has become the default cyber security risk management process, and one that is recognised in the

US and elsewhere because it provides a sound basis for establishing business security priorities and processes.

The adopted protocol should enable an organisation to identify a security breach, then isolate and mitigate it.

There needs to be an established pathway for reporting the breach to senior management, aligned with the urgency of need for response to the incident. These are all key components of a measurable security management framework.

The chosen framework should collect, monitor, measure and report information that delivers key security indices for establishing benchmarks and what ‘normal’ looks like. This data should be delivered in a dashboard format to provide a visualisation tool for both store owners and senior management level.

Cyber security definition Cybersecurity is the body of technologies, processes and practices designed to protect networks, computers, programs and data from attack, damage or unauthorized access.

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March 2018 – Edition 2

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INDUSTRY NEWS NATIONAL

A new Nationals leader – a new beginning MGA warmly welcomes Michael McCormack as the new leader of the National Party and new Deputy Prime Minister of Australia.

Jos de Bruin, CEO of MGA Independent Retailers said today that, “In his new roles Michael McCormack will be a great asset to the Cabinet. He is a staunch supporter of small businesses and understands the needs and concerns of family owned businesses.

Jos de Bruin with Deputy Prime Minister Michael McCormack

He has grown up in a family business and, as Member for the Riverina district in NSW, he is in touch with the wider needs

of the Australian community.”

Mr. de Bruin said, “Last year Mr. McCormack travelled around Australia on his Small Business Roadshow where he met and talked to family enterprises and privately owned business owners in about 30 different venues.

He gained valuable insights into their needs and was able to assess their vital contribution to the Australian economy.

We are confident that he will continue to use his voice for small businesses in Cabinet and we congratulate him on his important new role.”

WESTERN AUSTRALIA

MGA WA Government meetings On the 6, 7 and 8 March the MGA WA Committee met with various WA Government Ministers, Chiefs of Staff and Senior Policy Advisors concerning a number of industry matters affecting MGA members.

The McGowan Government – elected 1 year ago, is very receptive to learning how WA family enterprises and private businesses can be encouraged to grow, invest and employ more Western Australians.

There are a number of challenges in WA that face our members everyday including; Competition – level playing fields, liberisation of trading hours, inconsistent planning and zoning rules, excessive land tax and local council rates, Container Deposit Scheme, plastic bag bans, energy costs and tobacco regulations, the entrée of Costco on federal airport land and so on.

To address these matters, MGA WA met with Minister for Industrial Relations and Commerce, Hon Bill Johnston, Minister for the Environment Hon Stephen Dawson, Minister for Small Business Hon Paul Paplia’s Chief of staff, Minister for Health Hon Roger Cook’s, Chief of Staff and Minister for Energy (and the Treasurer) Hon Ben Wyatt’s Senior Energy Policy Adviser.

Jos de Bruin, Minister Stephen Dawson, Waly Daly, Greg Brindle and Gino Divitini A number of proactive initiatives have come from these meetings that MGA must follow up on.

Minister for the Environment, Stephen Dawson has advised the WA Container Deposit Scheme (CDS) will not be launched until 2019 after watching the debacle of this scheme in NSW. MGA will be included on the WA CDS consultation committee.

Plastic bag bans will go ahead from 1 July 2018 and will be launched with a consumer education program to include all forms of media.

MGA and MGA WA Director Gino Divitini (Hilton) will keep all WA members and industry stakeholders informed of all progress as a consequence of this very productive engagement with the WA Government.

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INDUSTRY NEWS

WESTERN AUSTRALIA

MGA WA Industry Business Breakfast MGA held its WA Industry Business Breakfast at the Karelee Tavern, Como Perth, owned and operated by MGA member Pierre Sequeira (IGA Como), on Thursday 8 March 2018. Attended by over 55 members and industry stakeholders this event proved to be very insightful and a valuable networking event.

MGA board member and Hilton Supermarket operator Gino Divitini was the MC at the event and warmly welcomed all those who were in attendance.

Special guests and speakers included; WA Minister for Commerce and Industrial Relations Hon Bill Johnston, Federal Senator Slade Brockman, who represented Minister Michaelia Cash and Executive Director for the WA Small Business Corporation, Jacky Finlayson.

The Hon Bill Johnston

All speakers were excellent and gave valuable insights into matters affecting MGA members on a day to day basis.

Minister Johnston gave an overview of the WA Government’s first year in office and the budget deficit challenges it faced, as well as the opportunities ahead to drive state growth in the near future. Minister Johnston stated there would be no further changes to trading hours with the current government albeit the government has committed to honouring arrangements the previous government made – e.g allowing Coles and Woolworths to trade between 8am and 6pm on the Labour Day and Easter Monday holidays (which was not made public until 1 March this year, catching MGA members out).

Senator Brockman, shared his experiences as a WA farmer and a Chief of Staff for

March 2018 – Edition 2

We thank all those who attended this special event. Particularly thank our special guests and speakers, Pierre Sequira, his son in law Rueben, Sharon and all the staff at the Karalee tavern.

Linda Boswell, John Cummings, Grant Hinchcliffe

Debbie Smith and Connie Macri

Attendees at the breakfast

Ross Anile, Carmel Goldsmith, Tony Macri

the Federal Minister for Finance Mathius Cormann. Senator Brockman shared a number of points Minister Cash had requested he mention to the audience regarding the workplace, innovation and jobs growth. Jacky Finlayson, spoke passionately about her 16 years at the WA Small Business corporation and her complete commitment and dedication toward successful WA small businesses.

Supporting the WA Small Business Commissioner, Jacky mentioned there are many support services MGA members can avail themselves to. Jacky reiterated the WA Government’s great determination to foster new and existing small businesses.

Jacky Finlayson

Gino Divitini and The Hon Bill Johnston

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INDUSTRY NEWS QUEENSLAND

MGAQ committee meeting MGA Queensland Committee has been very busy!

A Queensland election was held in late 2017 and the Palaszczuk Government was returned with a majority.

The MGAQ Committee had a very good working relationship with all sides of the previous Queensland Government which will continue on now into the new term of government.

Debbie Smith, Foodworks store owner from Toowoomba, MGA Director and MGAQ Committee member, represents our industry sector on the Queensland Small Business Advisory Council. This Council has also been very busy identifying business opportunities for Queensland family enterprises and private businesses both under former Small Business Minister Enoch’s watch and now under new Small Business, Jobs and Training Minister Shannon Fentiman.

On 28 February, the MGAQ Committee met in Brisbane to meet with ministers and senior department staff to advocate for and discuss a number of matters of concern to our Queensland members.

The key people the MGAQ committee met included; new Minister for the Environment Hon Leeanne Enoch, Kylie Hughes, Director Department of the Environment Waste Management Policy, New Small Business, Jobs and Training, Minister Hon Shannon Fentiman, Small Business Champion, Maree Adshead and Executive Director for Small Business Queensland, Rebecca Andrews.

Topics discussed included; • Debilitating increases in electricity prices • Packaged liquor for independent supermarkets • Opposing any additional tobacco regulations or costs • Container Deposits Scheme (CDS) – official launch delayed to 1 November. Will be a not for profit model. 304 collections points around QLD. 10 cents per container refund parameters to be confirmed • Plastic Bag Bans (36 microns or less) – scheduled to launch 1 July with consumer education campaign to commence March and April.

Minister Enoch (middle front) with the MGA Queensland Committee •

Planning and zoning matters – inconsistencies removing investment certainty

All MGAQ Committee members were heartened by Minister Enoch’s decision to delay the launch of the QLD CDS from 1 July to 1 November 2018 to ensure the CDS is ready for operation.

Mark Meszaros from the Drakes Group represents members on the CDS task force which is the working group of industry and government stakeholders being consulted to launch a seamless CDS. We thank the MGAQ Committee for their dedication and commitment to our Queensland members.

PROSECCO SPRITZ JUST POP & POUR

Minister Shannon Fentiman (8th from left), Maree Adshead (2nd from right), Rebecca Andrews (3rd from left) with the MGAQ Committee

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INDUSTRY NEWS

NATIONAL

Rod Sims Chairman ACCC – Extracts 2018 compliance and enforcements speech ACCC Chairman Rod Sims gave a compelling speech at the annual CEDA Conference in Sydney on 19 February 2018.

There were two key extracts from the speech that MGA members worked tirelessly for over many years that have come to life as a consequence – here are some of Rod’s words.

“Reflecting on 2017, a significant year in competition law and policy.I think we all know that 2017 was a landmark year in competition in many ways. I will here briefly mention the most obvious highlights.”

Harper Review and Report “The standout in 2017 was passage of; 1. The Competition and Consumer Amendment (Competition Policy Review) Bill on 18 October, and 2. The Competition and Consumer Amendment (Misuse of Market Power) Bill 2017 on 25 August.

These two bills brought the Competition Policy Review (aka, the Harper Review), to a very successful conclusion.

As you all know, the Harper legislation contains a broad range of amendments to the Competition and Consumer Act (CCA) in relation to cartels, price signaling and concerted practices, exclusionary provisions, third line forcing, resale price maintenance, merger and non-merger authorisations, notifications and access.”

“These amendments potentially rank as the most significant changes to our competition laws since the introduction of the Trade Practices Act in 1974.”

“Most significantly, they position the ACCC better to protect competition and consumer interests in a time of unprecedented technological change.”

Some key challenges “We have many challenges as we approach 2018.”

Harper in action: “This year is the first full year that the Harper Reforms will be law, and their introduction has coincided with an education and awareness campaign for business.

ACCC Chairman, Rod Sims

The reforms to section 46 (the misuse of market power provision) and the introduction of ‘concerted practices’ have been in force since November last year.

• We have already established a specialised unit known as the Substantial Lessening of Competition Unit (SLC), to focus on investigations that could give rise to cases that use the new laws.

• The SLC Unit also has a broader mandate to enhance our investigation of competition cases and look afresh at the way we handle such investigations.

• The SLC Unit is managed by a former Executive from our Mergers branch, Cameron McKean, and he brings his competition analytical skills to a team containing a great deal of investigation experience. We are in the early stages of some important investigations and are looking forward to making announcements later in the year about them.

• We understand the importance of our case selection given the bizarre debate prior to the passing of these laws.”

Many thanks are extended to all MGA members and industry stakeholders for their tireless efforts in lobbying MPs from all sides to help bring these significant competition law reforms into play.

Rod Sims would like to know from any of MGA’s members about incidents that may indicate “a misuse of market power” by a large corporation.

Email: admin@mga.asn.au

March 2018 – Edition 2

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INDUSTRY NEWS WESTERN AUSTRALIA

Farmer Jacks supermarket, Gwelup WA Independents are constantly changing the supermarket game – that’s the ability and agility independent supermarket operators have compared with the slow moving chains. Fred Fairthorne is the industry’s change agent.

Constantly moving the goal posts and bringing to the consumer fresh locally grown foods at value prices with superior customer service.

It was only recently that Fred Fairthorne and the team at the 3,200 square metre Gwelup supermarket converted the store to a Farmer Jacks supermarket. Being a local shopping centre with a strong supportive community base of customers, the first priority was to freshen up the store, increase the range of fresh and grocery products and deliver an exceptional shopping experience for customers.

Led by the store manager Peter, together with store staff, the transformation was quick and effective.

As you enter the store there is a wonderful fresh sushi bar complete with chef, a fresh low level bread section, an “Oven Express” department, fresh flower display and entry into a ”market style” fresh produce section.

There are 12 gondola ends for bulk displays with weekly specials, a huge range of dry groceries, 32 metres x 5 shelves of freshly cut meat and chicken products, 32 upright fridge doors of delicatessen products including cheeses, small goods, olives, fresh fish, pizzas and so on. In addition, there are 9 x 2 metre coffin fridges of fresh berries, fruit, pizzas, readymade meals, quiches and cheeses.

The fresh and frozen seafood range is extensive with 16 x 2 metre coffin freezers and fridges displaying a wide range of seafood products.

Fresh fruit, vegetables and produce

are proudly displayed in 80 x 1.5 metre square bins. A very large proportion of fresh produce is WA local. The store also boasts an extensive range of organic and vegan catering for the growing health conscious market.

Aisles are wide and well lit, shelves well stocked and staff are ready to

provide customers with exceptional service and fast movement through one of the 7 register lanes and 3 fast lane registers.

Congratulations to the Farmer Jacks Gwelup team – this is another fine supermarket providing for the needs of the local Gwelup community.

www.mga.asn.au

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INDUSTRY NEWS

QUEENSLAND AND NORTHERN NEW SOUTH WALES

IGA Queensland & Northern NSW State Awards On 16 February 2018, over 400 IGA Queensland and Northern New South Wales retailers, their families and staff gathered at the Brisbane Convention Centre to take part and celebrate the nominations and eventual state departmental and overall store award winners for 2017/2018.

This prestigious event was hosted by very popular comedian and personality Jean Kitson. Jean kept the evening running smoothly and the audience engaged and amused whilst doing so.

Chairman of the QNN IGA State Board, Frank Spano and acting Metcash Queensland and Northern NSW General Manager Roy Leisk made recipients of awards feel warmly welcomed to the stage and officially presented the awards.

The atmosphere in the room was terrific with retailers relishing the opportunity to catch up with each other, network and share their stories.

IGA QNN Retailer of the Year Award winners – CONGRATULATIONS • IGA Xpress Channel – Bowen Hills • IGA Channel – Whites IGA Peregian Beach • Supa IGA – Ritchies Boonah Rising Star Award – Mark Pettit – IGA Tweed Valley Way State Community Award – Terry Slaughter QLD IGA State Operations Manager, Tim Manic presented the

Michael White and the White’s IGA Peregian Beach team

Terry Slaughter, IGA Springfield Lakes

March 2018 – Edition 2

Peter Lee Ritchies QNN

Department

Supa IGA

IGA

Delicatessen

Whites – Bli Bli

Whites – Peregian Beach

Meat

Shakes – Atherton

Jones – Mount Cotton

Bakery

Ritchies – Boonah

Whites – Peregian Beach

Produce

Ritchies – Boonah

North Buderim

General Merch Cornetts Gordonvale Dairy Freezer

Cornetts – Port Douglas

Whites – Peregian Beach Whites – Peregian Beach

Service Dept

IGA Meadowbrook

Retail Transformation

Princes IGA Deagan

Small Format Transformation

IGA Xpress – Alexandra Hills

well-deserved Queensland State Community Award to IGA Springfield Lakes store owner and operator Terry Slaughter. Terry and his wife Frances are heavily involved with their local and industry community on many different fronts and have endeared themselves to their loyal customers through their committed community activities.

Ritchies SUPA IGA Boonah

Roz White, White’s IGA Peregian Beach

INDUSTRY NEWS

17

www.mga.asn.au

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INDUSTRY NEWS

NEW

March 2018 – Edition 2

19

INDUSTRY NEWS VICTORIA, NEW SOUTH WALES AND QUEENSLAND

NATIONAL

Fred Faithorne, Ritchies CEO

Ritchies Group supplier update The Ritchies Supermarket Group held its 2018 industry supplier day on 1 March 2018, at the Southern Golf Club in the South East of Melbourne.

Over 250 suppliers and industry stakeholders attended the golf event in the morning (over 90 players) and the business luncheon.

Ritchies CEO, Fred Harrison presented a “state of the nation” report on behalf of the Ritchies Board followed by Ritchies General Manager for Merchandise and Marketing, Jarrod Swaine and Ritchies Liquor General Manager, Karl Loh. Fred reported the Ritchies Group, like for like sales and profitability had significantly improved upon last year despite the many business cost and competition challenges affecting many stores and praised all Ritchies staff for their hard work and

commitment to continuously improving the Ritchies business in Victoria, New South Wales and Queensland. The absorption of the Victorian Fishers Supermarket business was also progressing nicely with a” slowly slowly” approach being taken to ensure seamless integration.

Jarrod and Karl both emphasised the Ritchies desire to lead the market with agility and innovation and implored upon suppliers to better understand the needs of the independent supermarket operator and to become more category and business development focused. Being first to market with products, new technology and new store layouts are critical to enable a point of difference in the market place.

The Ritchies Group thanked all suppliers for their commitment to the Ritchies business and the industry sector in general.

WESTERN AUSTRALIA

Vale – Rob Thomas At the recent MGA Industry Business Breakfast, prominent WA independent retailer Robert Halvorsen paid tribute to highly regarded former fellow retailer Rob Thomas. Rob tragically died in a yachting incident in The Robert Halvorsen Bunbury and Return Ocean Race, off the WA coast, about 11 nautical miles south-west of Mandurah on the evening of 23 February. Rob Thomas, an accomplished Sydney to Hobart yachtsman, was the skipper of the yacht Finistere which broke its keel. Rob Thomas and his family owned the independent supermarket in Captain Stirling, Perth for many years.

Rob will be sadly missed by his family and many friends and colleagues.

Campaign to reduce company tax In 2017 MGA advocated strongly with all sides of government in Canberra for a reduction in company tax for its members. After vigorous debate in the Senate and some clever negotiation by the Coalition, legislation was passed to reduce company tax on 1 July 2017 from 30% to 27.5%, decreasing to 25% in the coming years for companies with a sales turnover of $50m or less.

This will be a terrific savings benefit for MGA members allowing members to allocate surplus funds toward much needed refurbishments and employing more people.

MGA is now advocating to urge all sides of government to support a reduction in company tax for all businesses – large and small. A reduction in company tax for all businesses from the current rate of 30% toward 25% will enable global competitiveness, as well as encourage investment in businesses, innovation and employment, ultimately benefitting the family enterprise and private business sector.

Legislation is currently before the Senate that seeks to reduce the rate of tax paid by all corporations from 30% to 25% over the next decade.

www.mga.asn.au

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INDUSTRY NEWS

Public, private or hybrid cloud; Which option is right for you?

Due to GPK Group’s recent announcement as Australia’s first managed services provider and one of the world’s earliest adopters of Microsoft Azure Stack cloud solutions, we thought it a good opportunity to provide guidance on the various flavours of ‘Cloud.’ We’ll start off with some basics in this issue, however over the year we’ll delve into specific areas of interest to independent retailers such as yourself.

3. Customisation – shared systems have limited scope for tailoring to specific needs

There’s no denying the extraordinary impact cloud technology has on the way we do business. Companies of all sizes, across all industries, leverage its capabilities daily, to reach global markets, increase efficiency and reduce costs. Yet despite its popularity, many business owners are unaware of the wide range of cloud options available, or indeed, whether their current cloud strategy is fit for purpose.

Public cloud Probably the best-known type of cloud service, the public cloud is exactly as the name suggests: a service available to the general public, either on a pay per use or subscription basis. Hosted by a thirdparty provider, it offers the convenience of high scalability and reliability, frequent improvements and new features, and needs little or no maintenance and management by the user.

The primary benefits of a cloud-based system are: 1. Scalability – the capacity to expand or contract the size and type of services quickly according to need.

2. High uptime – constant monitoring, maintenance and sophisticated security minimise loss of service.

3. Cost efficiency – users only pay for the level of service they need at a given time.

In contrast, key concerns about cloudbased systems include: 1. Data sovereignty – data stored offshore is subject to the laws of that location, which may differ from those of the business and potentially expose privacy risks 2. Control – sensitive information stored outside the confines of the company’s own systems creates uncertainty and a sense of vulnerability

Knowing your perspective on each of these points is a great place to start when deciding which of the three cloud types – public, private and hybrid – will best meet your needs. Let’s look at each type in a little more detail:

These systems are great if uptime, accessibility and cost efficiency are a priority, and you don’t require high level customisation or to safeguard sensitive information.

Private cloud Businesses in highly specialised industries, or that require top level control over system design and security may opt for a private cloud service. These are built on infrastructure you own which, depending on the provider and product, can be stored at your site or remotely and are only accessible to your company.

A private cloud enables you to fully customise the system to suit your precise requirements, providing superior quality and flexibility. Like the public cloud, it also enjoys high scalability and availability, but as with many bespoke product or services it can also be considerably more expensive than a public service as the overall cost is borne by one rather than multiple tenants.

Hybrid cloud Sometimes the best solution is to leverage the advantages of both cloud types. Hybrid cloud is a service which combines the flexibility, economy and scalability of the public cloud with the security, privacy and customisability of a private cloud.

This suits a range of scenarios, including companies that: • Need to migrate gradually from legacy systems • Have both low security and highly sensitivity data and applications • Need flexibility to manage periods of peak demand • Operate highly latency sensitive applications • Need to balance innovation with compliance and cost efficiency As you can see, there are many things to consider when looking for your ideal cloud solution. However, before you jump into any new system, it’s essential to thoroughly assess your current situation.

This includes mapping out your existing network, determining your company’s approach to digital transformation and seeking the advice of a cloud services expert, so you can be sure of making the best changes for your long-term future. Like any core business function, technology implemented with good planning and a measured approach greatly increases your chances of success. Be sure you are partnering with a company with the depth and breadth of expertise you require. Particularly one who can help you navigate end-toend managed services, cloud, mobile and paperless office technology. GPK consultant, Ben Holian, is available for a no obligation discussion on how GPK can help you reduce operational costs, manage your IT footprint more effectively and create an exceptional experience for your customers.

Phone 1300 000 475 or email info@gpkgroup.com.au for more information.

March 2018 – Edition 2

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INDUSTRY NEWS WESTERN AUSTRALIA

Farmer Jacks supermarket, Currambine WA North of Perth you will find a state of the art Farmer Jack’s supermarket in a newly developed local shopping centre in the suburb of Currambine.

Fred Fairthorne and his team saw an opportunity to create an incredible supermarket with a heavy focus on fresh food. This was bound to attract consumers from far and wide to shop there in preference to the two big chains and Aldi.

Ably managed by acting manager Tulla Sanford, this magnificent store, approximately 2000 square metres in size, with warm polished concrete floors, well-lit with natural and LED lighting boasts one of the best WA local product ranges in WA. There is a huge range of freshly cut meat on display in 30 upright fridge doors and 8 x 12 metre coffin fridges. Fresh

seafood is abundant and is displayed in 10 x 2 metre coffin fridges, in addition to 4 x 2 metre frozen seafood freezers.

Also, there are 3 x 3 metre freezers full of frozen berries. An amazing offer! A massive range of local and imported cheeses are presented in 8 x upright fridge doors as well as 5 x 2 metre coffin fridges. There are 28 upright fridge doors of delicatessen products, 31 doors of dairy, milk and small goods and 34 doors of frozen goods including ice cream (14), berries (2) and general frozen products (18) – very impressive.

a large range of locally grown vegetables together with 40 x 1.5 metre display bins of ultra-fresh fruit, vegetables and produce. There is a 12 metre x 5 shelf dairy case displaying specialty vegetables and herbs along with a 2.5 metre fresh self-serve “ready to go” salad bar.

Fresh is king in this store and is evident with the huge presence of fresh vegetables, fruits and other produce ready for sale. 8 metres x 5 shelves of fresh eggs are on display as you walk into the fresh section of the store. 48 metres of waist height central shelving displays

80 staff members are committed to providing consumers with exceptional customer service – that’s why customers keep coming back to this store.

Not only is fresh a focus but so too is the range of products available in this store.

Customer’s shopping experience is further enhanced with superb customer service and being able to avail themselves to 1 of 8 registers and 3 fast lanes registers.

Congratulations to all the team at Farmer Jacks Currambine.

www.mga.asn.au

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INDUSTRY NEWS

NATIONAL

Merchant payment costs and least-cost routing MGA members will be well aware that there is much talk about the shift that is occurring from older payment methods such as cash and cheques towards electronic methods such as cards, BPAY, and other electronic funds transfers, like the ‘pay anyone’ functionality offered in online banking.

For example, in the recent consultations around the Black Economy Task Force, merchants and merchant organisations expressed interest in switching away from cash to electronic payments.

And the Reserve Bank of Australia’s (RBA) support for the New Payments Platform over the past five years has very much reflected the RBA’s desire to improve the quality of electronic payment services that are available to consumers, businesses and government entities.

However, merchants such as MGA’s members, have also expressed concerns that electronic payments can be quite expensive. Some MGA members have reported that merchant transaction fee costs have more than trebled over the past few years. More specifically, many MGA members have indicated that the cost of payments has increased as debit card transactions are shifting from PIN to contactless | (or tap-and-go) authorisation.

One area where competition is yet to emerge is in the provision of least-cost transaction routing to merchants. Different card transactions have different costs for merchants, with debit cards usually having lower merchant service fees than credit cards.

In addition, debit transactions that are processed through the domestic eftpos system are on average less expensive than transactions processed through the international MasterCard and Visa systems, reflecting both lower interchange fees and lower scheme fees (the fee that the merchant’s bank pays to the payment network).

In ‘contact’ or ‘dip and PIN’ transactions involving dual-network debit cards, the cardholder chooses whether the transaction

goes via eftpos (if they push CHQ or SAV) or the international network (if they push CR). However, with the introduction of contactless cards, the cardholder and merchant no longer influence the routing of the transaction – it is determined by the network priority that is preset by the card-issuing bank when it sends the card out. Initially, the international schemes were the only networks with contactless functionality, so a contactless debit transaction could only go via their networks. However, eftpos has now rolled out contactless functionality on almost all debit cards and almost all terminals are now enabled for eftpos contactless transactions.

With international scheme transactions typically being more expensive for merchants, merchants report that the shift from contact to contactless transactions has resulted in a significant increase in payment costs for debit transactions and many merchants are now increasingly interested in their banks providing them with the ability to send debit transactions via the lower-cost network even if that network is not the first-priority contactless network on the card.

The RBA understands that a number of acquirers (banks) are currently considering providing least-cost routing to merchants, a development which would contribute to a more competitive and efficient payments system. As noted above, one element of the undertakings provided by the three debit card networks in 2013 in relation to dual-network debit cards was that schemes would not prevent merchants from exercising choice in routing contactless transactions.

Eftpos has developed a contactless payment facility – it is now up to the acquirers (banks) to offer eftpos as a choice as a part of least cost routing.

MGA sought the RBA’s advice in regard to MGA members minimising sharply increasing merchant payment costs. The RBA suggested that MGA members should be talking with their respective banks and requesting from them the best “least cost routing” solution within the earliest time frame to assist with decreasing these costs. It could take 3, 6 or 9 months depending upon their agility for change.

If members are not satisfied and the timing to long, there are other alternative acquirers now such as TYRO which is an innovative new “acquirer” providing “least cost routing”. TYRO is a young and agile company that is modern and progressive.

Source: RBA – Merchants Payments and Least-cost Routing

March 2018 – Edition 2

LEGAL AND HR

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LEGAL AND HR Long service leave and transfer of business

Dealing with staff register problems

Purchasing or selling a business is not as simple as agreeing on a figure.

Whether you are the vendor (old employer) or the purchaser (new employer), there are consequences as to the entitlements and liabilities for employees working for the old employer.

This article will only focus on long service leave entitlements upon a transfer of business, but please be aware that consideration must also be given to other entitlements such as annual leave, sick leave and redundancy.

The rules for long service leave entitlements are currently contained in state and territories laws. In all states and territories, full time, part time and casual staff start accruing long service leave from the date they commence employment; however they are generally only entitled to take long service leave after working 10 continuous years for the business.

But what happens to employees’ accrued long service leave when there is a sale of business and the employee transfers employment from the old employer to the new employer?

Section 22(5) of the Fair Work Act 2009 confirms that continuous service for long service leave purposes is not broken if an employee is dismissed by their former employer and re-engaged by their new employer. This is also confirmed by the long service leave legislation in each state of Australia. This means that their long service leave will continue to accrue irrespective of the transfer of business or change of employer, and their previous service counts towards their total period of continuous service.

Therefore, upon a transfer of business the liability for any transferring employees’ long service leave automatically transfers to the new employer, regardless of whether or not they were compensated for taking on this liability or if the new employer was informed of the outstanding long service leave entitlements prior to settlement.

There is no law that requires an old employer to pay a new employer for long service leave entitlements, unless they are contractually bound to do so, and this should always be a consideration when negotiating a sale of business.

It is therefore crucial when negotiating a sale of business that the employee entitlements to long service leave are fully disclosed and considered as part of the transaction. Otherwise new employers may be held liable to pay employees significant amounts for their long service leave without any way to claim that amount back.

It often happens that an employee who works on the cash registers makes errors by over stating the change or a customer is disgruntled by receiving an under amount of change. These errors will naturally be a loss for a store or result in a dissatisfied customer.

Occasional errors are an inevitable consequence of working in money handling jobs but, if an employee is responsible for continually making errors or significant amounts are missing from a register then the problem needs attention.

Obviously, training is a pre-requisite for any checkout operator and this should be given prior to an employee commencing work on registers. We need to operate on the premise that no one can be 100% right every time, however, once training is given to an employee the employer is entitled to expect a reasonable level of expertise.

It there appears to be a continual problem then re-training should be provided and an official warning given to the employee that improvement is expected. If after re-training the problem continues then the employer should consider whether the employee is suited to the role. MGA has a register policy that is signed at the time the training is provided and a second policy where it is necessary to retrain.

These are available at no cost to members. Call us and we will forward the policies to you. Call Legal and HR on 03 9824 4111 (line1).

www.mga.asn.au

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LEGAL AND HR

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March 2018 – Edition 2

It is vital that you provide your employees with all the details of their entitlements in regard to payments. This is a legal requirement and ensures that you are protected in the event of any einquiry undertaken by the Fair Work authorities. Every pay slip must show the the following details: • The employer’s name and ABN • The employee’s name and classification • The date of payment • The pay period to which the payment relates • Date of payment • If the employee is paid at an hourly rate, the: o Ordinary hourly rate o Number of hours in that period for which the employee was employed at that rate o The amount of the payment at that rate (It should be noted that even if the employee is not paid an hourly rate the pay slip needs to show what the equivalent hourly rate would be) • Any loadings, allowances, bonuses, incentive based payments, penalty rates or other paid entitlements separated from the employee’s ordinary hourly rate • Gross amount of the payment • Net amount of the payment • Details of any extra payment such as allowances or penalty rates and details of any deductions • If superannuation payments are to be made, the amount of the contribution and the name of the superannuation fund into which the contribution is to be paid.

• The sick leave and annual leave that the employee has accrued to date.

Under no circumstances should you pay your employees in cash without the appropriate deductions being made as referred to above.

Heavy penalties can be imposed for non-compliance with fulfilling the pay slip requirements.

LEGAL AND HR

25

When is superannuation payable?

Employers only need to pay superannuation contributions of 9.5% for eligible employees.

All employees (including casuals) over the age of 18 who earn at least $450 (before tax) in a calendar month are eligible for contributions. Employees who earn less than this are not eligible.

There is an added requirement when paying superannuation for employees under 18 years of age. You are only required to pay contributions for these employees if they earn more than $450 (before tax) in a calendar month and work more than 30 hours per week. If a junior employee under 18 years of age earns more than $450 (before tax) in a calendar month, but works more than 30 hours in just one of those weeks in the month, superannuation is only payable for wages earned in that one week.

Below is a table summarising the types of payments that superannuation will and will not apply to: Payable •

• • • • • •

•

Salary or wages not including overtime (however if an employee has agreed to work a certain number of hours, those hours are the employee’s ordinary hours of work) Weekend work Bonuses and commission payments Payments in lieu of notice Over award payments Shift and casual loadings Workers compensation payments, including top-up payments paid by the employer where work is performed** Payment for annual leave, sick leave or long service leave which has been taken as time off

You must pay an employee’s superannuation contribution in any month that they work enough to become eligible for superannuation contributions.

“ordinary time earnings” which generally means what the employee earns for their ordinary hours of work. An employee’s ordinary hours of work may be stated in the relevant award or agreement. If the ordinary hours are not specified or agreed, the ordinary hours of work will be the hours actually worked (not including overtime) and any hours of paid leave.

Superannuation is only payable on

**Please note that if the employer

The entitlement to superannuation is calculated on a month by month basis.

Not payable • • • • • • • •

• •

Overtime Reimbursement of expenses Allowances including laundry allowance Workers compensation payments where no work is performed** Payments when on jury duty Parental leave payments Annual leave loading Accrued annual leave, long service leave and sick leave paid as a lump sum on termination Redundancy payments Other payments paid by an employer on termination of employment

operates under the General Retail Industry Award, superannuation is payable on workers’ compensation payments (even when no work is performed), up to a maximum of 52 weeks.

Members should also check any other applicable award or workplace agreement which may require superannuation payments in some circumstances which are normally excluded.

Addressing sexual harassment in the workplace It is crucial that employers are proactive when dealing with sexual harassment and have policies and procedures in place that clearly state that sexual harassment is unacceptable in the workplace.

Sexual harassment is any unwanted, unwelcome or uninvited conduct of a sexual nature that a reasonable person would find offensive, humiliating or intimidating. Employers must take steps to limit their exposure to liability from sexual harrasment by ensuring that all employees are provided with a safe workplace.

To achieve this it is crucial that employers have: • A sexual harassment policy that is clear and well drafted; • Employees receive training on the policy and how the policy will be implemented; • Ensure that the enforcement of the policy is implemented and sexual harassment conduct is investigated; • An effective process is in place for dealing with complaints of sexual harassment which includes a point of contact who is equipped to

•

initiate the investigation process for employee’s complaints; An effective process for sexual harassment complaints to be fairly and impartially investigated with appropriate disciplinary outcomes in place.

A failure to take reasonable steps to prevent sexual harassment can have serious repercussions to both the employee and for the business. If members require assistance in this area they should contact MGA’s legal and HR team on on 03 9824 4111 (line 1).

www.mga.asn.au

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LIQUOR NEWS

27

LIQUOR NEWS MGA welcomes new Victorian members MGA welcomes our two most recent liquor members and wish them every success in their future trading.

Cellarbrations Somerville Welcome Bill Howard from Cellarbrations Somerville.

Bill has owned the store since June 2017 and believes product range and customer service are the key to succeeding in today’s competitive retailing sector.

Bottlemart Macleod Welcome Andrew Boudoloh from Macleod Bottlemart. Andrew runs the family business with his wife Katie and son Jeremy.

In June 2017 his passion for the liquor industry saw him establish a new store on greenfield site in the Macleod, Aberdeen Road shopping strip. Prior to this Andrew owned and ran the Foodworks store at Dalton Village Shopping Centre, Epping for nine years.

Andrew Boudoloh

www.mga.asn.au

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LIQUOR NEWS

NATIONAL

Independent liquor store operator leads innovation in competitive market Alcohol delivery service Tipple is meeting the demands of tech savvy millennial shoppers by offering ‘ultra-convenience’, with many customers opting to buy on demand as an alternative to visiting their local bottle shop.

By building its own online marketplace, tech platform and on demand delivery network, Tipple has the ability to plug into hundreds of retailers to deliver alcohol in less than 30 minutes. Currently operating out of 9 zones in Melbourne, Tipple opened its first zone out of their Cellarbrations at Windsor liquor store servicing a delivery radius of approximately 4kilometres from the bottle shop. That particular zone is currently averaging sales of $30,000 per week ($1.5 million annually).

grown to deliver to 262 suburbs across Melbourne and has over 500 product lines on the platform. The average sale on Tipple is $70 double that of a bottle shop.

“Just as UberEats, Deliveroo and Menulog partner with restaurants, we too partner with bottle shops, so it’s a win win for all parties involved, ultimately boosting their bottom line.”

Founded by brothers Ryan and Shane Barrington, the duo have had to shift

The start-up is now scaling nationally, with 41 zones earmarked around the country as potential hot spots. Several zones have already been negotiated in Sydney, due to open early next month with many more to open in the coming months.

Designed to be integrated easily into existing bottle shop systems, Tipple’s proprietary technology sends orders directly to partner stores, algorithmically sorts them into optimal delivery routes and automatically assigns pickup and delivery to the closest available driver all while the customer tracks their order on the Tipple app.

Co-founder Ryan Barrington said Tipple has been able to unlock a new opportunity within the Windsor area that local bottle shops couldn’t have tapped into themselves.

The start-up’s software is raising eyebrows in other industries too, with many large companies struggling to keep track of deliveries or seeking new ways to effectively manage their fleets.

“Currently there are approx 100,000 adults who live within this zone, and we have made regular deliveries to over 6,000 of these adults, representing a 6% market penetration. Shoppers are pressed for time. They want things now and in the easiest way possible.”

“Our system solves these big problems while also enabling on demand delivery to customers, which is fast becoming an expectation of customers in every industry,” said Ryan.

“Once we’ve successfully scaled Tipple nationally, we’ll then look into opening up our tech to other industries.”

“There’s 39 bottle shops within our Windsor zone alone, so it’s a testament to our tech platform and user experience that we’ve been able to achieve so much success within a highly saturated area.”

“Traditionally to capture an additional 10% of sales in our liquor stores, takes a lot of hard work, hence we were absolutely thrilled when we increased our revenue by 50% in one bottle shop,” he said.

Since launching in late 2015, Tipple has

March 2018 – Edition 2

Images of the Tipple website and app – along with Tipple Director Shane Barrington

their business model over the past two years, from originally owning bottle shops within the distribution network to now partnering with them.

For more information please visit www.tipple.com.au or download the app via the App Store or Google Play.

LIQUOR NEWS

31

NATIONAL

Drinkwise to strengthen responsible drinking campaign Drinkwise is an independent, not-for-profit organisation established by the alcohol industry to bring about a healthier and safer national drinking culture.

CEO Simon Strahan stated that the success of DrinkWise programs over the past year was underpinned by a sustained focus on evidence-based campaigns and the understanding that coordination and collaboration with suppliers, stakeholders, industry and government can deliver exceptional results.

Research conducted by Drinkwise, shows that more Australians are drinking within health guidelines and the rate of underage drinking is decreasing, mirroring government statistics. While

these results are encouraging and suggest that our nation’s relationship with alcohol is fundamentally changing to one that is more mature and responsible, DrinkWise will continue to focus on misuse of alcohol that causes harm at the individual, family and community level.

DrinkWise also plans to undertake a comprehensive engagement program with government, stakeholders and industry in 2018 to ensure that our program benefits are widely known and understood. This will pave the way for our partners and stakeholders to proactively identify opportunities for moderation message integration.

Strahan went on to say that Industry can

assist by adopting the DrinkWise developed messages within their own sponsorships or retail promotions wherever possible and that active support by all producers, large or small, is key to Simon Strahan amplifying our work beyond what we could achieve on our own. Including ‘Get the Facts’ and ‘Pregnancy’ messaging on products and packaging are very simple ways to demonstrate support.

For further information about DrinkWise please visit drinkwise.org.au.

www.mga.asn.au

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LIQUOR NEWS

Around the World Cocktails rise and shine, while beer and wine sales slip Mikells told investors earlier this year.

“You can see across our biggest brands, our global giants and local stars—it’s the reserve brands and variants that are growing faster.” Those brands include Johnnie Walker Green Label and Johnnie Walker Gold Label Reserve, pricier variants of its flagship Scotch whisky.

Liquor makers sold more spirits and mixed drinks around the world in 2016 than in the year before—a bright spot in an industry where volumes of almost every other kind of alcoholic drink are in decline.

Overall, last year was a tough one for beer and wine. Global alcohol volumes across all types fell 1.4%, a steeper decline than the average 0.3% drop over the past five years, according to industry tracker IWSR. Beer volumes fell 1.8% around the world in 2016, while wine sales slipped 0.08%. Yet sales of hard alcohol like gin, tequila and whiskey eked out an increase of 0.04%, and mixed drinks, including pre-mixed cocktails and some flavoured alcoholic beverages, grew by 1.6%.

The numbers underscore a shift in consumer tastes away from beer and wine and toward drinks that typically pack a higher percentage of alcohol, though intended to be consumed in less volume.

Spirits are growing faster in the U.S. They were up 2.6% last year, in line with the five-year average and more than double wine-sales 2016 growth. Overall alcohol sales in the U.S. inched up 0.1% by volume.

The growth has been helped by liquor makers’ efforts in recent years to attract new drinkers. Makers of scotch and other types of whiskey have been courting women and younger drinkers while internationally, spirits companies are pushing into Africa, China and other developing markets where beer has typically been king.

“Scotch is coming out of the stuffy club room into the cocktail bars and

March 2018 – Edition 2

restaurants,” said Bacardi International Ltd. Chief Executive Michael Dolan. Spirits makers, he said, are benefiting from the revival in cocktail culture.

Liquor ads, after years of restrictions in the US, have crept back onto TV screens in recent years. The National Football League, a holdout until recently, accepted commercials for distilled spirits in the 2017 season. Spirits have also benefited from what executives describe as more fickle consumption habits by millennial drinkers, who tend to sip on a range of different beverages.

Spirits tend to retail at higher prices than wine and beer, providing a bit of a cushion for the alcohol industry as a whole. Despite falling volumes last year, the dollar value of alcoholic drinks sold globally grew 4.7%, according to Euromonitor. In the U.S., dollar sales rose 3.3%.

Liquor makers have started pushing more expensive brands, as have beer and wine companies.

“We continue to look to premiumize,” Diageo PLC Chief Financial Officer Kathy

Earlier this year, Diageo launched a new high-end Irish whiskey brand, Roe & Co, which sells at £30 ($39) a bottle in the U.K. Rémy Cointreau SA, which currently gets 50% of its sales from products priced above $50 a bottle, has set a target to bump that share up as high as 65%.

The taste shift has left brewers out in the cold. Beer volumes in the U.S. fell 0.3% last year, according to IWSR, and beer makers experienced big sales drops in key overseas markets. An economic crisis in Brazil sent sales down 5.7%.

Chinese beer sales fell 4.2% as drinkers flocked to wine and spirits. Beer sales in Russia fell 7.8% amid economic headwinds and price rises there.

“We need to take back the share of stomach we’ve lost over the past decade to wine and spirits,” said Britt Dougherty, Miller Coors’s Vice President of Marketing Insights and Engagement.

Anheuser-Busch InBev NV’s Bud Light, the biggest beer brand in the U.S., continues to lose volume and market share. After a failed bid to revive the brand last year, AB InBev this year launched a new U.S. marketing campaign. The company last month said it would invest $2 billion through 2020 in U.S. capital expenditures targeted in part at “elevating” struggling core brands.

Source – The Wall Street Journal

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LIQUOR NEWS

Gin sales hit record high Gin sales hit a record high at Christmas after consumers bought the equivalent of a bottle for every adult in the UK last year, according to latest figures.

The festive period saw sales rise by £104m compared with the previous year, according to the Wine and Spirit Trade Association (WSTA).

Over 16 million bottles of gin, worth £413m, were sold in the 12 weeks to the end of December – an extra three and a half million bottles bought or 28 per cent in volume over the festive season.

Britain’s love for the tipple made gin a popular gift at Christmas, along with a wide range of gifts such as gin baubles, gin advent calendars and gin glassware.

And over the last year, Britons bought a whopping 51 million bottles of the spirit, according to the WSTA.

The figure is 27 per cent higher in volume, the equivalent of more than nine and a half million more bottles, than 2016.

The rapid growth in UK distilleries and the increasing number of gin brands arriving on the market last year helped the recordbreaking sales.

There are now 315 distilleries in the UK, more than double the number that were operating five years ago. The amount of gin brands has doubled since 2011, with well over 100 British gin brands on the market.

Last year was also a record-breaking year for British gin exports, which broke the £500m barrier to hit £530m in value sales.

WSTA chief executive Miles Beale said: “We were amazed by the growth of gin in 2016, but 2017 sales of the British spirit have surpassed all records again.

At the WSTA we are constantly being

asked “what is the magic formula behind the growth in gin sales?” It is a delightful combination of a quality British product steeped in history combined with skilful innovation by UK distillers who are producing a huge range of gins catering for the consumers’ increasingly sophisticated palettes.

“The versatility of gin with its diverse use of botanicals means there is now a gin out there for everyone”.

Source – The Independent UK

WESTERN AUSTRALIA

WA Government amendments to the Liquor Control Act to restrict liquor barns to 400 square metres The WA State Government is on a collision course with retail giants Coles and Woolworths over moves to curb the proliferation of “booze barns” such as Dan Murphy’s and First Choice Liquor.

Amendments to the Liquor Control Act that were introduced into the WA

parliament would ban liquor outlets of a certain size from opening within a specified radius of each other. The government is proposing 400 square metres and 5km.

A separate plank of the legislation would ban the Director of Liquor Licensing from approving any new packaged-liquor outlet, regardless of size, if they were satisfied requirements were already being “reasonably” met by outlets nearby.

Racing and Gaming Minister Paul Papalia said most consumers could already buy alcohol within an acceptable distance of their home.

Minister Papalia said the legislation, if successful, could be a template for other

states. “It will slam the barn door shut on liquor barns in areas that are already oversupplied,” he said.

Minister Papalia said big retailers were moving into a well-serviced area, “cannibalising everybody else through the provision of low-priced liquor in bulk and in so doing over-supplying that particular area and doing considerable harm”.

As there are already about 30 liquor “barns” in WA, Minister Papalia denied the proposed reforms would affect prices.

Liquor Stores Association chairman Lou Spagnolo, representing smaller retailers, said it was wise to have controls which cut pressure to discount heavily.

www.mga.asn.au

34

LIQUOR NEWS

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March 2018 – Edition 2

35

LIQUOR NEWS

Penfolds and Squealing Pig take out top awards at the Best Wine of the World competition

Penfolds Grange 2012 was named Best Syrah of the World, Penfolds Yattarna 2012 was named Best Chardonnay of the World and Squealing Pig Rosé 2017 took out the title for Best Rosé of the World.

in the world, with more than 22,500 wines entered; and a total of 1,333,896 votes from 620,000 wine professionals and wine lovers from 105 countries. The competition is run by the world’s largest wine information service – Tastingbook.com.

The voting took place over a three month period. After voting, the top 180 wines across six different categories progressed to ‘The Finals’, consisting of a blind tasting by a panel of Tasting Book Professionals (selected judges from over 7,000 pros: wine writers, bloggers, MW’s and winemakers).

The BWW competition claims to be the largest wine competition

Other TWE wines to receive awards were:

Penfolds Grange 2012, Penfolds Yattarna 2012 and Squealing Pig Rosé 2017 have been recognised as being among the best wines of the world in the new international Best Wine of the World competition (BWW).

Penfolds Penfolds Yattarna 2012 •

Best Chardonnay of the World

Squealing Pig Rosé 2017 •

Best Rosé of the World

•

Most voted Rosé wine

Grange 2012 •

Best Australian Wine

•

Best Syrah of the World

•

4th Best Red Wine of the World

•

Most voted Australian wine

The full list of winners and prizes can be found at www.tastingbook.com.

Wolf Blass Yellow Label Cabernet Sauvignon 2016

Wynns Black Label Coonawarra

•

Best Buy

•

People’s Choice Award

Cabernet Sauvignon 2015 •

People’s Choice Award

To speak to your local TWE representative about these wines call 134 893.

www.mga.asn.au

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TRAINING

37

NATIONAL

MGA INDUSTRY TRAINING The importance of safety training in the supermarket Supermarkets and liquor stores hold the potential to pose several hazards to their customers and employees. Below are a few obstacles businesses must overcome on a daily basis, and tips on being proactive in addressing the issues.

Obstruction hazards can cause customers and employees to trip. It is important to ensure aisles and walkways are clear to prevent tripping hazards to customers and employees. Pallets and various other stocking materials should be kept off the floors in the sales area during normal business hours to avoid creating tripping hazards.

Other obstacles to be aware of include loose floor mats, any products that have fallen off shelves, and exposed electrical cords. Employees should be on guard for any hazards that present themselves throughout the course of a business day and take immediate action to prevent injury.

Slipping hazards can occur from water build up on grocery store floors, leaky pipes in refrigeration units or spilled products can create a potential slipping hazard. Maintaining floor cleanliness throughout a store is vital to the well being of its employees and customers.

Employees should always wear slip resistant shoes and maintain a daily cleaning schedule to prevent dirt and oil from building up on floors. Employees should be educated on proper cleaning practices and the correct materials to use in the event of a spill.

cross contamination. In an effort to maintain sanitation in the workplace, employees should practice washing their hands regularly, and wear clean clothing to work to prevent the spread of outside bacteria. Grocery stores should supply sanitising stations throughout the store for constant sanitary purposes.

Bacterial hazards can develop when equipment, including knives, cutting boards, and other utensils are not properly maintained. Certain departments, like the meat and deli sections, require special attention to ensure bacteria does not spread. These departments are prone to bacteria growth and should be monitored carefully for

Mechanical hazards can occur from equipment with sharp or moving parts, like deli slicers or forklifts. Employees tasked with using any type of machine should be properly trained and practice safe use of the equipment. Machinery that is used regularly should be inspected for damage.

Should any issues arise, management should be made aware right away.

Young people in the workplace Young workers are the most vulnerable to workplace injuries, according to WorkSafe Victoria. Statistics showed that 49 young people aged 15-24 were injured every week in 2015/16 and said that employers need to prioritise safety discussions and training to reduce the risks. Overall, 2,554 injury claims were made by young workers in Victoria.

are providing appropriate training, information and advice.

Employers must take time to educate their young workers of the potential risks involved in completing certain tasks and how to control or eliminate those risks. Teaching young people how to properly operate machinery and equipment is also vital.

The statistics revealed that young workers in retail, hospitality, manufacturing and construction suffered the most injuries.

The most common cause of the injuries was poor manual handling, while hand, finger and back injuries were the most common injury types.

Injuries such as pulled muscles, twisted knees, bad backs caused by poor manual handling and repetitive lifting and stacking are common injuries amount young people and the effects can last a lifetime. The message is that every employer must take the responsibility to ensure that you are providing appropriate training and guidance for all employees, especially young workers.

Even though the number of injuries to young workers has declined over the past six years, it is critical that employers

www.mga.asn.au

38

TRAINING

NATIONAL ONLINE COURSES MGA delivers training and compliance solutions specific to the needs of independent retailers. We have a range of training and compliance solutions readily available for members. *Log in to our website with your member login to order your courses at these member prices.

Call us on 1800 888 479 if you need your log in details.

Manage Training System (MTS) Manage Training System (MTS) is an easy to use training program – set up training per department, allocate courses to staff, monitor results and have complete training records for all staff. Either use included HR policies or upload your own including staff rosters!

Managing Your Employees It is important to understand the laws associated with managing employee issues. Learn how to deal with difficult employees and resolve workplace problems.

Knowing the correct procedure to follow if termination of employment is required is vital so as to avoid costly court hearings. This seminar will provide you with the necessary information to establish a safe and productive workplace.

ADELAIDE Date: 24th May, 2018 Time: 9.00am – 1.00pm Members price: $165

March 2018 – Edition 2

TRAINING

39

Online & face to face training MGA Industry Training offers discounted training for all members. Courses are online or can be conducted face to face at your business for 10 or more employees! Responsible Service of Alcohol, Food Safety, Employment Law, Customer Service, plus more!!!

Tobacco training This course covers information on the legal obligations for the sale and service of tobacco, non-tobacco smoking products, smoking accessories, e-cigarettes and e-cigarette accessories in each respective state/ territory. Training ensures your staff comply with Tobacco Retailing Laws – protecting your business.

STATE BASED TRAINING Duration: 30 minutes Member price: FREE

Don’t forget to log in for your member discounts!

Visit www.mga.asn.au to see our range of training courses!

www.mga.asn.au

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