7. APP F. Economic Matters RFI Response

As shown in Table 5, in 2012 dollars, Primary Catchment expenditure on groceries and tobacco is
estimated to be $9.99m (2011) growing to $12.14m by 2036. For the Secondary Catchment,
expenditure on groceries and tobacco is estimated to be $10.7m (2011) growing to $13.17m by 2036.
The major grocery chains would capture approximately 85% of this expenditure. The residual (15%) of
available expenditure is captured by other retailers, usually so-called convenience stores such as those
proposed in the development. Retail offers of ~200m2 in this regard do not represent a competitive
offer to the retailing majors.

Table 5: Expenditure Shares (2012 $)
                               2011         2016          2021          2026           2031            2036
 Groceries and Tobacco
 (Primary)                   $9,992,059   $11,709,401   $12,008,661   $11,968,935    $12,079,375    $12,137,356
 Groceries and Tobacco
 (Secondary)                $10,690,809   $12,372,387   $12,892,098   $12,913,866    $13,071,684    $13,172,361
 Total                      $20,682,868   $24,081,788   $24,900,759   $24,882,801    $25,151,059    $25,309,717
 Majors' share (85%)        $17,580,438   $20,469,520   $21,165,645   $21,150,381    $21,378,400    $21,513,259
 Residual (15%)              $3,102,430    $3,612,268    $3,735,114    $3,732,420     $3,772,659     $3,796,458


As the proposed development would only service a convenience demand, it can reasonably be
expected that it will capture market share from this residual expenditure. It is likely to draw the
majority of its trade from the Industrial Catchment and the Primary Catchment, and to a lesser extent
passing trade from residents of the Secondary Catchment. Given that the likely impact (refer below) is
negligible any estimate of market share distribution across catchments would be a fraught exercise.
We can note that the expenditure estimates are for the residential population only. As noted earlier,
there are at least 4,700 additional persons within the area as workers in the industrial precinct.
Assuming that each worker spends on average $240 per year on groceries and tobacco on
convenience groceries (equivalent to 8.7% of Primary Catchment per capita expenditure per year), this
would add an additional $1,128,000 to current groceries expenditure. Added to the residual (2011) this
would provide a potential pool of residual + worker expenditure of $4.23m for convenience retailing.

Information Required: Provide a reviewed calculation of worker expenditure on take-
away food adopted in section 4.6 of the Economic Report so that it represents only a
proportion of the average per capita expenditure on take-away food, and revise any
estimates of worker expenditure.
The Economic Report estimated that a worker would spend on average $1,440 on takeaway food each
year. This figure is considerably higher than the per capita expenditure for the surrounding catchment.
The Information Request rightly seeks clarification on this point, given the disparity. Firstly, it needs to
be noted that the household expenditure survey estimates provide an average for the entire
population. There is thus a range either side of this average. Our estimates recognise that industrial
precinct workers are likely to exist at the outer limits of the distribution range of expenditure on
takeaway foods. This is for the reason that unless they bring food to work, they have no choice but to
eat out.
The estimate of an average of $1,440 per person per year is based on the following assumptions:
•   A worker eats out 4 days a week and does so for 46 weeks a year (total eat-out days = 184)




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