The National Independent Liquor Wholesalers Association (NILWA) has announced that it will be permanently ceasing to operate on 31 May 2024. Up until this date, NILWA will be working on finalising existing agreements with its suppliers and partners.
“The members met on Monday to vote on the recommendations from Martin and I to close the business, and that all came about with the changes in the industry but also the pressure it would apply to our membership,” said Jenny Hughes, NILWA’s Managing Director.
“NILWA is an association of wholesale members and we’ve lost a few wholesalers over the years and yeah, the pressure was just a little bit too much this time around for us to bounce back from.”
The announcement, first shared publicly today, follows on from the recent collapse of Gateway Liquor, one of its three wholesale members. The Sydney-base wholesaler entered into liquidation at the beginning of March this year, surprising many given the business’ solid reputation. Hughes considers Gateway Liquor’s liquidation to be the biggest contributing factor to today’s decision.
“It was a big factor – it was probably the catalyst for the decision,” she said.
“With them going into liquidation it was, you know, they were our final big wholesale member. We had only left two members left and it just was not enough for us to sustain the association.”
Rivercity Wholesale Liquor and Monacellars Liquor Specialists are the two remaining wholesale members that will be effected by todays announcement. Both are expected to continue operating as normal.
“Rivercity and Monacellars: they’re independent businesses in their own right so they will continue to trade in their areas and hopefully they will continue to be successful,” said Hughes.
“We’ll work with both of them until the end of May when we finish up just to transition any of the national programs into their businesses so they’re not going to be disadvantaged by the association closing.”
Hughes also said that Signature Drinks, NILWA’s liquor wholesaler banner based in Newcastle, will continue to be used by Rivercity and Monacellars, although potentially under a different name.
“It’s a brand that Martin and I created in 2014… it was the brand that all our marketing programs and activations for customers lived,” she said.
“The framework will be continued to be used by Rivercity and by Monacellars [although] not really sure what will happen with the branding issue.”
NILWA’s closure is reflective of widespread industry pressures that have been impacting all levels of the on-premise ecosystem. The February CreditorWatch Business Risk Index (BRI) forecasted that more than 7% of Australian food and beverage sector businesses will terminate operations in the 12 months up to February 2025. The same BRI also recorded a significant decrease in the average value of invoices, reflecting the strain currently being experienced by wholesalers.
“[This shows] businesses were running down their inventories in anticipation of further declines in consumer demand,” said Anneke Thompson, Chief Economist at CreditorWatch, in a statement provided to the Drinks Association.
“While the February BRI data recorded a seasonal increase in the average value of invoices from January to February (up 10.4%) values continue to trend downward and sit at their lowest point since September.
“The sustained fall in the average value of invoices over 2023 was a very good leading indicator of the overall slowing of the economy.”
The NILWA Head Office, lead by Managing Director Martin O’Mara and General Manager Jenny Hughes, has six full time employees that act as the first point of contact for its members. The closure of the NILWA association, which services more than 10,000 customers, is expected to have significant consequences for the industry.
Jenny Hughes says that she anticipates further liquidations and administrations in on-premise venues to occur over the near to medium future.
“I think on premise is really struggling. It really hasn’t bounced back from COVID, so I think the repercussions are really now starting to be felt – that’s not just from a wholesale perspective, it’s from a venue perspective as well,” said Hughes.
“I think the whole knock on effect of the post-COVID environment has really just had an impact on on-premise which hasn’t allowed us to bounce back as well as we would have liked.
“From a venue or customer perspective, I think there’s probably a still bit of pressure to come.
