The Australian Association of Convenience Stores (AACS) says the Fair Work Commission’s decision to increase minimum and award wages by 4.75 per cent will add significant labour costs to a convenience sector already grappling with surging operating expenses, an escalating illicit tobacco trade eroding legitimate revenue, and some of the toughest trading conditions on record.
AACS Chief Executive Officer Theo Foukkare said convenience retailers value their teams and support fair wages, but a decision of this magnitude cannot be considered in isolation — particularly when the sector’s own data shows labour costs have already risen much faster than inflation.
“Convenience stores are the backbone of local communities — they open early, close late.
Many are open around the clock — and we know our people are central to that,” Mr Foukkare said.
“This decision lands on top of cost pressures that are already stretching operators to their limit.
Our 2025 State of the Industry Report found labour costs across the convenience channel rose almost 9 per cent last year — nearly three times the rate of inflation.
“Adding a further 4.75 per cent wage increase on top makes an already difficult situation even harder.
“Combined with rising energy, rent, insurance, freight, compliance and security costs — and an illicit tobacco trade that has stripped billions of dollars from legitimate convenience retailers — margins across the sector are under enormous strain.
“More than half of Australia’s 7,541 convenience stores are independently owned, and many are family run businesses – so for these operators, every cost increase is felt immediately and personally.
“For many independent operators, this decision will force hard choices about staffing, trading hours and investment.
“Convenience retail is also one of the nation’s great entry points to employment, giving tens of thousands of young Australians their first job.
The decision comes ahead of the Commission’s junior pay rates ruling taking effect, and the cumulative impact will materially increase employment costs for the many stores that employ younger workers.”
Mr Foukkare said sustainable wage growth ultimately depends on a stronger, more productive economy and a policy environment that backs small business.
“If we want higher wages to be sustainable over the long term, we need policies that lift productivity, cut red tape, and tackle the illicit tobacco trade that is bleeding legitimate retailers dry,” he said.
“Without action to address the growing cost of doing business, the pressure on convenience stores will keep building — and ultimately that has consequences for jobs, the local services communities rely on, and the prices Australians pay.”
Theo Foukkare is available for interview on 0423 003 133
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