No matter what you think of the reforms to provincial beer sales that Premier Kathleen Wynne announced yesterday, there’s no doubt the changes are the biggest overhaul of Ontario’s antiquated beer retail system since Prohibition.
Two governments before hers—Mike Harris’s Conservatives, and her predecessor’s, Dalton McGuinty, each promised to shake up the Beer Store Family Compact and give consumers more choice —but they both either chickened out, or made things worse.
The new deal will result in more Ontarians getting their hands on micro-brewed ales and lagers. The Ontario Craft Brewer’s Association cheered the announcement, predicting the share of craft beer sales in the province will jump from its the 2013 share of 3% to between 15 and 30%. Increased sales will drive growth, which drives jobs—and please guys—higher salaries for craft brewery employees, who are grossly underpaid in my opinion. Now that’s something to be excited about. So grab a pint tonight and raise your glass to long overdue reform. As you do, ponder the future.
HERE ARE FIVE GOOD THINGS AND FIVE CONS ABOUT ONTARIO’S NEW SYSTEM:
2. EASY ACCESS & CONVENIENCE THANKS TO GROCERY STORE BEER
Who doesn’t want to pick up beer with their groceries? By Christmas a few grocers will carry six-packs, with 450 different supermarkets peddling suds by the end of 2017. Living downtown Toronto, I’m spoiled for choice of large LCBO’s to shop at, but most Ontarians are not: and as a new mother, sometimes it’s just easier to grab beer with the milk. It’s true that Loblaws and Costco will charge outrageous listing fees and put those who can pay the highest listing fees (likely much higher than The Beer Store ever charged) on display, it’s also known as capitalism. The good news is this should be balanced somewhat by a number of smaller grocers and specialty markets like Whole Foods coming up with innovative programs and great selections for us specialty beer geeks.
CON: Grocery store sales capped
Stores will be limited to sales of $1 million each. Let’s put that in perspective: if store sells their entire cap, the total revenue is less than 25% of the Beer Store’s current total sales. The only reason Why put a measure like this in place? To continue protecting the LCBO and The Beer Store’s sales against the private sector. Note to Premier Wynne, this does not equal: #freeourbeer.
2. BEER STORE CRACKS OPEN… A LITTLE
The announcement says the Beer Store will be “forced” to open up ownership to craft brewers. (We all know the franchise owned by Molson, AB-InBev & Sapporo already tried this in an attempt to stave off government reform, let’s hope the ownership model is meatier than their initial offer). Plus it’ll have to give craft brewers 20% of shelf space and promotional time, more than doubling the current 7% share and lowers listing cost for the smallest brewers. The Wall of Beer that so many of us complain about will disappear forever, as the chain will pony up $100 million to convert stores to open-concept, self-serve models.
CON: New Beer Tax (i.e. We pay the franchise fee)
The much talked threatened franchise fee that Premier Wynne alluded to the Beer Store paying in order to keep its retail system never materialized. Instead, we pay! The government claims this move is in “fairness to big brewers.” Cases of 24 beer will cost $1 more with 0.25 cent increases each November until we hit a buck.
3. LCBO PICK-UP AND ONLINE ORDERING
It’s time the LCBO stepped into the world of online retailing. This idea has been on the LCBO’s own radar for awhile. And no doubt, at the snail’s pace that organization moves, it’ll take years to develop the site. But if the result is a simple, easy-to-search site with quick pick up or delivery options, the move grants better access to more beers to more Ontarians, especially those living in small cities and towns who don’t have Summerhill or Queen’s Quay stores nearby.
4. GROWLERS IN LCBO’S
How many stores will get growler refill stations, we do not know yet—but this bone brings us a teeny bit closer to being in step with the heartbeat of craft beer: the ability to taste rare, fresh one-off brews from new and favourite brewers.
POTENTIAL CON: It will only be effective if the LCBO is able to shed its bureaucratic chains (ha!) and organize a system that puts rare, rotating and seasonal brews on tap. The whole point of growlers is to be able access rare and small-batch brews that will never be bottled. (Please don’t try to serve me a growler of Crazy Canuck, I can just buy the damn can, which is a better package for beer freshness anyway). Also, if kegs are sitting in the unrefrigerated warehouse as long as some of the cases of beer do… the idea will get as stale as the beer.
5. LCBO BOUTIQUE STORES PEDDLING CRAFT BEER AND VINTAGE SPIRITS & SELLING 12-PACKS
Under a secret pack between The Beer Store and the LCBO, the latter was not allowed to sell anything larger than a six-pack. The government is changing this, albeit really cautiously, “trialling” 12-pack sales in 10 stores, eventually ramping it up to 60. But the boutique stores sound fun, right?
CON: Why only a handful of LCBO’s carrying 12-packs, and no cases? In order to protect the “economics of the Beer Store.” Awesome. More #freeourbeer from Premier Wynne. The report says these “boutiques” will be included in existing LCBO stores. Um, what? Isn’t that just a new section? If they’re just moving the SAME beers already available to a boutique section, WTF is the point? To be effective, boutiques need to be reserved for specialty beers, giving shelf space to new offerings and fantastic Old World favourites from across the globe.
And while the Ontario Craft Brewers Association has lauded the agreement, the government gave them far less than some anticipated. Ed Clark had openly discussed creating “craft beer stores,” and the OCB advocated for these specifically.
We’ve come far in these reforms—but we’ve got a looooong way to go and a lot of questions to be answered.