As Melbourne’s stage four COVID-19 restrictions come into effect this week, the Victorian retail landscape is set to change drastically, and almost overnight.
While it’s a tricky time for everyone, the market for subscription and delivery services is booming. That’s especially true when it comes to booze.
Subscription startup Whisky Loot is based in Sydney, but has seen a noticeable uptick in business coming from Victoria in the past two weeks alone, founder and chief Joel Hauer tells SmartCompany.
Having raised $400,000 in seed funding back in January, the high-end whisky subscription service saw an unexpected boost to business as the coronavirus came to Australia, recording its best month ever in March.
That growth has been continuing ever since, Hauer says. The startup has moved to a warehouse eight times the size of its original space, and is doing four times the volume of its February sales.
“It’s definitely stretched us, but we’ve managed to keep up,” Hauer says.
Over the past month or so, the second wave of the virus in Victoria saw the re-introduction of stage three restrictions in metropolitan Melbourne and then the rest of the state.
This week, Victorian Premier Daniel Andrews announced even stricter stage four restrictions for metropolitan Melbourne, including restrictions on shopping for essentials (including alcohol), and the closure of the majority of retail stores, except for delivery and click-and-collect services.
And Whisky Loot is already seeing the effects, with Hauer noting a 20% uptick in business in Victoria.
“The amount of transactions we get across has definitely skewed a lot more towards Victoria in the last two weeks,” he says.
“They’re spending more as well.”
Orders are coming in from both new and existing customers, and people are already getting organised for Father’s Day next month, Hauer observes.
It seems it’s not so much about accessing alcohol — you can do that at any old Dan Murphy’s or local bottle shop. Whisky Loot offers different tipples to taste, and the element of surprise.
It’s about recreating “the luxury of going to a bar”, the founder says.
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But, with retailers closing their physical doors, e-commerce is expected to soar in the Victorian capital.
That will likely put pressure on those charged with the delivery, including Australia Post, which is responsible for getting Whisky Loot’s subscription boxes to the door.
According to Australia Post’s own data, online shopping was up more than 100% in Melbourne for the first three weeks of July, compared to the same time last year. And that was before the harsher restrictions came into play.
Judging by Hauer’s own conversations with Australia Post, he says they’ve been “at their Christmas levels” since March.
“I don’t know how much they can take.”
However, he’s confident they’ve had time to prepare for this situation, and will rise to meet the challenge
“As things gradually get worse, hopefully, they’ll be able to equip their teams and get through the backlog.”
And, if stricter restrictions were to come in in some of the other states, he says Whisky Loot would be in a position to handle that.
His business is in “a pretty safe industry”, he says.
“Pretty much every state is still allowing bottle shops to operate, and even more so the ones that do either click-and-collect or delivery,” he explains.
And with everyone except the warehouse manager and operations manager able to work from home, the business should be able to stay on its feet even if the toughest of restrictions are implemented in New South Wales as well.
“It is a funny situation to be in,” the founder says.
“You’re looking at your business growing, and it’s completely opposite to what’s happening in the world.
“It feels like I’m living in my own little bubble.”