Revenues in the Australian health retailers market grew by 4% to reach a value of A$19.6 billion in 2012. The channel consists of 9,607 outlets, which grew in number by 1% over the year.
The lower growth witnessed in the latter part of 2008-2012 was attributable to lower discretionary spending by consumers and a movement towards other store-based retailers and online retail, as cost-conscious consumers looked for lower prices.
With chemists/pharmacies providing an important role of community health support, the channel held the largest value share of 78% within health retailers in 2012. Australians typically seek out chemists/pharmacies for mild or recurring health complaints, including coughs and colds, as well as for symptoms which are less severe.
The limited resources within the general practice and hospital networks are also factors driving consumers to seek first-line assistance from chemists/pharmacies.
According to a recent report, 'Health and Beauty Specialist Retailers in Australia,' 2012 saw health retailers fight back against store-based retailers from other retail channels by emphasising customer service and by ensuring they were able to provide the most customised or appropriate product for the customer's needs.
Health and retailers fought back against online retailers by investing in their online retail offers. This has been a successful strategy for many players, such as Chemist Warehouse and Australian Pharmaceutical Industries. During late 2012, Australian Pharmaceutical Industries had an average basket size from sales from its online store of A$58, while the average basket size in-store was closer to A$30, according to the company.
Australian Pharmaceutical Industries (API) maintained its leadership of the Australian health retailers market in 2012, with a value share of 11%. Although API saw an actual increase in its sales in 2012, its overall percentage share dropped as it underperformed the category as a whole.
Chemists/pharmacies will continue to play an important role in offering consumers healthcare solutions over the next five years. The burden placed on Australia's wider healthcare system due to the ageing population is expected to be so great that hospitals and doctors' surgeries, chemists/pharmacies and grocery channels will each play an important role in providing efficient cost effective healthcare in Australia's communities.
For more information on the Australian health retailers market, see the latest research: Australian Health Retailers Market
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