Butchers being slaughtered?

BY Australian Retailers Association
09 March 2016

The days of the traditional butcher may be numbered, according to new findings by Roy Morgan Research, which show the proportion of Australian grocery buyers purchasing their fresh meat at the butcher’s in any seven day period fell from 23.1 percent to 17.9 percent between January 2013 and December 2015.

Despite the fall, statistics show the overall proportion of grocery buyers buying fresh meat anywhere has also fallen, from 75.6 percent in 2013 to 70.7 percent in 2015.

Aldi is the only major supermarket to have made any real gains in fresh meat sales over the last few years, with 9.6 percent of grocery buyers over the age of 14 purchasing their meat there in an average seven days, up from 8.5 percent in 2013 - an additional 265,000 meat shoppers each week.

Coles remained relatively stable, but Woolworths/Safeway, at 30.7 percent to 27.3 percent, and IGA, 8.1 percent to 6.8 percent experienced declines; as did markets and delicatessens - 9.1 percent to eight percent.

Butchers have seen the most significant decrease in purchase incidence, and, unlike supermarkets or markets and delis, do not have the scope to adapt to changing grocery buying habits with alternative products.

Butchers still hold a 23.5 percent share of the total fresh meat market due to the amount their shoppers spend in an average seven days - $37. This is just ahead of the average fresh meat spend for those grocery buyers who make their purchase at markets or delicatessens at $34.

While Woolworths and Safeway account for a larger slice of the market with 27.3 percent, their fresh meat customers spend substantially less, with a weekly average of $27 per shopper; as do those who buy their meat at Coles  - $25 or 23.2 percent market share - and IGA and Foodland - $22 or 5.4 percent market share.

With its customers spending a weekly average of $22, Aldi’s dollar share of the fresh meat market is currently 7.6 percent.

Andrew Price, GM Consumer Products at Roy Morgan Research, said Australian grocery buyers appear to be gradually moving away from purchasing fresh meat, and butchers are the most visible casualty.

“At the moment, despite their shrinking customer base, butchers are retaining a decent share of the overall fresh meat market due to the above average amount spent by those grocery buyers who continue to shop with them,” said Mr Price. “But unless they can stem or reverse the decline in shoppers, it seems inevitable that butchers’ market share will erode.

“The supermarket situation is a little different. The proportion of grocery buyers purchasing fresh meat is decreasing at a slower rate and the customer volume is much higher, whereas buying from a traditional butcher involves making a special trip.

“The news that Woolworths is changing the role of its staff butchers, bringing them to the front of store to sell pre-packaged meat and interact with customers rather than plying their trade out the back, indicates that the supermarket chain is endeavouring to pre-empt further declines.

“The number of Australians who are ‘eating less red meat these days’ now surpasses 10.2 million people (increasing by 293,000 people since 2013), and the number of those pursuing a totally or almost vegetarian diet also rose over the same period.

“Butchers and other players in the fresh meat market are facing challenging times. Knowing exactly who still buys fresh meat – from their demographics and attitudes to their shopping habits – is a good starting point, ensuring marketing communications are tailored to resonate with the right people,” said Mr Price.

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ABOUT THE AUTHOR

Australian Retailers Association

Founded in 1903, the Australian Retailers Association (ARA) is Australia’s largest retail association representing Australia’s $310 billion sector, which employs more than 1.2 million people. As the retail industry’s peak representative body, the ARA works to ensure retail success by informing, protecting, advocating, educating and saving money for its 7,500 independent and national retail members throughout Australia. For more information, visit www.retail.org.au or call 1300 368 041.

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