Sunday, 11 August 2013

Liquor Stores - New Opportunity to Distribute Liquor?

Liquor distribution -  New business opportunities for liquor stores to distribute liquor in South Africa may be on the cards.   This would be the result if independent beer distributor, Big Daddy’s, wins its case against SAB, which is currently being heard by the Competition Tribunal.   Big Daddy’s (BD) took on SAB in 2004 because it complained that SAB provided discounts to an elite group of 14 distributors selected by the brewer.    This meant that about 1200 smaller distributors had to, and still have to, buy beer and other products from SAB at full price.   It then has to sell it to its clients(bars, liquor stores, restaurants) at the same price.   What makes this situation even worse, according to BD, is that SAB doesn’t deliver in regions it deems to small or too remote(read – “not profitable”).  Furthermore, SAB also dictates delivery times and dates, although retail liquor outlets may want delivery at other, more convenient times or more often. 

Times Live reported that SAB denies BD’s claims and says it stands to lose R729-million a year if these "discounts" were extended to the 1200 independent liquor distributors.   It alleged that it would become an uncompetitive player globally and that  extending the discounts would create a "vicious cycle".

LiquorWise will keep you updated as this landmark case nears it conclusion.  

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