The SBP Archives - Your less than frequent dose of SBP!

Most of my friends know I'm not much of a drinker. I'd grab a chocolate milk before a Bud light. Sometimes, I get grief for it but overall, most respect my decision. Anyway, I'm going off on a tangent, because I didn't want to talk about me!

In Ontario, you can't go to the corner store to go buy a 6-pack as only licenced vendors have the right to sell alcohol. Originally, I thought both of these franchises: The LCBO and the Beer Store, were all controlled by the Ontario government. While some might say it should be in private hands, I don't have a problem with the way booze is sold in the province. The main reason is that alcohol, being a very lucrative & profitable venture no matter where you go, benefits its citizens here since all profits go back to the province to pay for hospitals, schools, roads, etc. Instead of Bill Gates using the money to buy another condo in The Turks & Caicos Islands (remember them?), it makes more sense to me to build another hospital.

But guess what? This isn't all true. Maybe you're aware of it, but I certainly wasn't until recently. The Beer Store is owned by Brewer's Retail Inc. The shareholders of this corporation are as follows:

Labatt: 49%
Molson/Coors Brewing: 49%
Sleeman: 2%

Now this is a pretty sweet deal if you are one of the owners of The Beer Store. I mean, you get to mark up your prices at every level of distribution. Labatt and Molson sell the most beer of any brand to start, and how big a chance does a microbrewery have in topping their sales when their competition are the ones responsible for selling their product? In addition, their only retail competition is LCBO, however, selection isn't as good and prices are pretty much the same.

There are some good things to come from this set up, for example, being under provincial scrutiny they have one of the best recycling programs for any retail chain, taking back almost 100% of all packaging needed to sell their product. And some argue that by having limited means to acquire alcohol by having higher prices, it helps curb alcohol consumption. Is it fair to say we'd have more alcoholics if it cost just $10 for a 24 pack of Blue? Probably.

But...I just have a problem with this scenario because there is no competition and really, unless you're close to a provincial border, you really have no choice in the matter. I think the LCBO could compete against any private retailer, and as I mentioned before, the benefactors are hospitals and schools so I think many would definitely take that into consideration when they choose where to shop. The way most beer is sold, it's simply a monopoly, and I'm not sure how much the province benefits when all proceeds from sales are headed back to the shareholders of Labatts and Molson's.

And that's my two cents during this long weekend.