German giant Aldi in bid to become first South Australia supermarket chain to sell alcohol
German retail giant Aldi is in a bid to become the first supermarket to sell alcohol in South Australia, and it could pave the way for other grocery giants to follow suit.
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Aldi could become the first supermarket to sell alcohol in South Australia under a special licence that could see other grocery giants follow suit.
After years campaigning for changes to the state’s restrictive liquor licensing laws, the German retail giant has found a loophole that could allow it to sell its private label range of wine, beer and spirits in-store.
It has applied for a “producer’s licence” at six stores across the state, at Newton, Blackwood, Aldinga, Adelaide Airport, Hawthorn and Victor Harbor.
While packaged liquor licences specifically prohibit supermarkets from selling alcohol, a producer’s licence allows its holder to sell alcohol it produces, similar to the conditions under which cellar doors operate.
South Australia and Queensland are the only states where supermarkets are prevented from selling alcohol.
A majority of the alcohol products sold in Aldi stores interstate are produced in partnership with suppliers and sold under Aldi’s own brands.
Aldi SA managing director Viktor Jakupec said: “The public of South Australia have spoken very loudly through social media and in other forums, regarding their strong support for Aldi operating its liquor service in SA.
“Aldi began to offer liquor in our Victorian stores in 2003, and since this date our offering has become a familiar and convenient part of a standard household shop.
“Liquor is currently available from selected Aldi stores in NSW, ACT, WA and Vic and our goal is to bring this same convenience, efficiency and quality range to shoppers in South Australia.”
Aldi’s application preceded last month’s changes to the state’s liquor licensing rules, but if successful, would transition to a new “liquor production and sales licence” category.
The new category allows a licensee to sell wine, beer and spirits if they are produced “by or at the direction of the licensee and is uniquely the licensee’s own product”.
Wine blended from Australian grapes with a “substantial proportion” of the wine produced by the licensee can also be sold if it is “uniquely the licensee’s own product”.
The Australian Hotels Association (AHA), which represents independent retail liquor stores and hotels with bottle-shops, is formally objecting to Aldi’s application.
AHA SA general manager Ian Horne said they were “a bit like Aldi sticking their middle finger up at SA’s legislative expectations”.
“This is not a slight loophole, it appears to be a deliberate attempt to circumvent the expectations of how alcohol should be sold in South Australia,” he said.
“What Aldi proposes is to circumvent this restriction (imposed in the packaged liquor licence rules) by seeking to be recognised as a producer despite not owning or operating any vineyards, breweries or distillers.
“Aldi’s liquor offer is exclusively “own brand”, i.e. someone else’s product rebadged to reflect the Aldi brand.”
Aldi offers a number of South Australian wines in its interstate stores, including the $6.99 One Road South Australia & Heathcote Shiraz, which won gold at last month’s Great Australian Shiraz Challenge.
According to a recent national survey of Aldi customers, its $4.99 South Pinot Estate Rose is the favourite alcohol product sold by the chain.
In its 2016 submission to the sweeping review that resulted in last month’s liquor licensing changes, Aldi argued that allowing “supermarkets to sell alcohol will increase the retail opportunities’’ for small South Australian wineries.
“Restricted sale of alcohol in supermarkets can have a positive social effect by ensuring alcohol is viewed as a complement to food,’’ it said in its submission.
Aldi operates 33 stores across the state, with plans for five openings next year and five more in 2021.
Attorney-General Vickie Chapman declined to comment on the matter, but said “if there are any policy implications to be considered once the application has been finalised, they will be examined in due course by the Government”.
Public comments are currently being sought on Aldi’s applications, which will be heard on December 18.