In the 2021 National Liquor News Industry Leaders Forum, we caught up with Paul Esposito, CEO of Independent Liquor Group about the goals for 2021.

Independent Liquor Group (ILG) has had a surging year of growth despite the wide ranging challenging events of 2020.

CEO Paul Esposito said from a financial perspective ILG posted a revenue increase of one per cent, up to $328 million, as well as a spike in membership growth, up by 14 per cent.

Despite the highly volatile environment caused by COVID-19, ILG continued to hold a strong balance sheet of $23.6m as at December, 2020. ILG reported a positive first half year (1H21) with sales up 19 per cent to $212m and a pre-tax profit of $4.0m compared to last year sales $178m and pre-tax profit of $0.5m.

Solid sales performance was driven by an increase in demand from the pandemic combined with new business. Net profit improvement was a result of implementing key measures across the business to protect the financial stability of the co-operative in the long-term.

Esposito said the figures are a direct reflection of ILG staff and member commitment and resilience, showing “cooperation, flexibility, agility and perseverance to endure.”

“We need to stay relevant for the longevity of our members. Along with sales and membership, other key areas include our staff, operational systems and infrastructure to ensure ILG is well placed to drive this growth.”

With its operations and financial stability on the right track, ILG’s goal in 2021 will be to continue growing its membership base in NSW, Queensland and Victoria while safeguarding membership retention. Although it’s still early in 2021, Esposito noted that the year already shows a continued surging trend in sales, profitability and membership.

Esposito said the substantial increase in sales has also led to increased pressure for ILG members to offer an online shopping experience.

“Take-away alcohol was another pandemic trend with venue capacity restrictions… and is likely to also remain in demand,” he said while noting industry trends.

“Drinking in moderation and having healthier options are becoming more and more the norm than an industry trend, proving that Australians are drinking less. We’ve seen increased initiatives from various suppliers launching new products that are addressing these emerging trends.”

He also explained that: “spirits rose to the occasion especially with the shutdown of bars and clubs, as more home cocktail experiments and experiences became trendy.”

Despite positive signs for its members, ILG will remain vigilant, especially as reduced household discretionary incomes possibly impact alcohol shopping budgets in 2021. Esposito also described how mergers and acquisitions will remain an ongoing concern for independent retailers and so will the dominance of major players in the market.

“This will remain a threat to independent retailers who have been far-stretched last year, with some unable to recover from the challenges and who may agree to a takeover,” he said.

“That said, with liquor enlisted essential, there is a silver lining in all this.”

Back on track

ILG’s most anticipated project is now back on track after experiencing delays caused by the Coronavirus pandemic.

The launch of its new ERP system is set to launch in August 2021 and will offer ILG members benefits from a more efficient and streamlined operational environment.

Esposito said the silver lining of its delay meant projects like the ‘Get Digital with ILG’ scheme was launched ahead of schedule. It meant members were presented with an online shopping solution to offer their respective local communities.

Read more great insightful stories like this in the 2021 National Liquor News Industry Leaders Forum.

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