liquor home delivery: Online, home delivery will make liquor more accessible to women buyers: United Spirits Ltd

United Spirits Limited, India’s biggest liquor firm with a brand portfolio that includes Johnny Walker and McDowell, said home delivery and online sales will not just expand basket size but also help more women consumers shop. “In many states, women do not want to go into a retail store to buy alcohol, it’s just unpleasant. In fact, I would go to the extent of saying, they feel unsafe. If you are ordering online, you will browse, and you will buy what you want,” Anand Kripalu, managing director at USL, told investors during an earnings call.

For the spirits industry, accessibility is one of the biggest barriers for consumption in the market with just 75,000 retail outlets, compared to over 10 million stores for fast moving consumer products. Also, several store owners are just putting a counter at the front, not allowing people into their stores, which in turn, could impact the way brands show up in the stores. “When you start browsing in a retail store, you end up buying more than you did in an over the counter store. The day you start browsing on Amazon or Flipkart, you start buying a lot more things than you did and you are able to double click and get a lot more details,” Kripalu added.

Many state governments that were affected by a fall in revenue during the lockdown tried to boost their coffers with a tax increase after the Centre allowed liquor shops to open in the first week of May. At present, two-third of the retail outlets have re-opened nearly and initially saw massive queuing outside outlets. Yet, sales volumes plummeted by 33% to 90% last month in five markets that account for 40% of the country’s spirits segment due to high taxes. Nearly a dozen states including Maharashtra, West Bengal, Delhi, Punjab and Tamil Nadu had allowed home delivery of liquor, something liquor companies have been trying to unlock since many years. Also, food delivery apps Zomato and Swiggy have started delivering alcohol in few states.

However, the home delivery model doesn’t bypass traditional retailers, which paid high license fees to enter the business. “You can’t have an Amazon kind of model in this industry, because the outlets are so few and they have paid high license fees to exist. And I don’t think any excise department will easily create a model that will destabilize the retailer themselves,” said Kripalu.

[Source – Economic Times]


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