There will be approximately 65M cases of wine sold in Australia in 2021 via multiple sales channels. The 'On Trade' sales channel represents about 20% of all sales equating to 13M cases & $2.4B in 2021. The average 'On Trade' sales revenue is about $185 per case. The average wine wholesale cost for 'On Trade' is 35-45% equating to an average wholesale price of $75 per case.
Wine- 35 percent to 45 percent (the cost percentages of wine can vary dramatically from restaurant to restaurant depending primarily on the type of wines served. Generally, the higher the price per bottle, the higher the cost percentage).
There are approximately 50,000 'On Trade' premises in Australia with 80% or 40,000 being restaurants, 15% or 7,500 being pubs, clubs, bars & the remaining 5% or 2,500 being hotels. The average annual revenue generated per 'On Trade' premise is $2.4B / 50,000 = $48,000 / 2.5 = $19,200 wholesale / $75 per case = 256 cases pa or about 5 cases per week average per 'On Trade" premise for wine only in Australia.
So on average each venue will buy about 256 cases pa x $5* each freight/storage = $1,280 revenue. The 256 cases equates to $19,200 pa x 10%** B2B fees = $1,920 revenue. Total annual revenue per average 'On Trade' premise will be $3,200. The logistics will generate circa 20% gross profit or $1 per case = $256 pa & the entire $1,920 for B2B is gross profit = $2,176 gross profit @ 68% margin. *Used bulk rate for freight. **Used base rate for B2B with no allowance for 2.5% early funds release fees etc.
1% market share = 500 'On Trade' premises x $3,200 = $1.6M revenue & $1.088M GP 5% market share = 2,500 'On Trade' premises x $3,200 = $8M revenue & $5.44M GP 10% market share = 5,000 'On Trade' premises x $3,200 = $16M revenue & $10.88M GP
The partnership with Bibendum is facilitating rapid exposure to 5,000 'On Trade' buyers or 10% market share. It appears that Bibendum will cease using their ordering platform for their 5,000 trade buyers when the DW8 B2B platform is launched & their product range uploaded by the end of this month.
The above figures are only for wine & don't include spirits, ciders, beers etc. They are for 'On Trade' only representing 20% of the wine market in Australia only. The figures represent averages & will be different between larger & smaller establishments. The 80/20 rule will most likely apply where 20% or 10,000 'On Trade' premises account for 80% or 10.4M cases pa equating to about 20 per week on average. The smaller 80% or 40,000 'On Trade' premises account for 20% or 2.6M cases pa equating to about 1.25 per week on average. Overall, I think Bibendums 5,000 'On Trade' buyers should reflect the industry average.
The mind boggles when you add figures for spirits, ciders, beers etc & address 'On Trade' buyers in international markets.
DW8 Price at posting:
17.5¢ Sentiment: Buy Disclosure: Held
(20min delay)