Industry Analysis & Industry Trends
Strong competition from the major supermarkets has created unfavourable trading conditions for the Delicatessens industry over the past five years. Low prices across numerous product lines in the major supermarkets have enticed consumers away from specialised retailers, hurting industry demand. However, the rising premiumisation trend among some consumers has buoyed the industry over same period. Industry revenue is forecast to grow at an annualised 2.1% over the five years through 2015-16 to reach $900.5 million. However, a 7.1% revenue decline in 2010-11 has skewed this growth figure. Industry revenue is forecast to grow at a modest 1.4% in 2015-16.
Supermarkets and grocery stores are the largest competitive threat to the industry... purchase to read more
Industry Report - Industry Investment Chapter
The industry has a moderate level of capital intensity. IBISWorld expects that for every dollar spent on wages, industry operators invest $0.16 in capital. Depreciation is used as a proxy for capital expenditure. The industry's capital intensity level has increased over the past five years, as indicated by depreciation rising as a proportion of industry revenue. Temperature-controlled displays and commercial refrigerators are the industry's largest capital expenses, along with store fit-out when the delicatessen is first established. Capital expenses are higher for operators that own their store rather than rent the premises.
Despite increasing capital intensity, the industry remains reliant on labour. This trend is prevalent across the overwhelming majority of retail industries... purchase to read more