Restaurants want in on selling alcohol for off-premise consumption

Published September 10, 2019

2019 Raise the Bar report from Restaurants Canada reveals a thirst for selling alcohol through takeout or delivery

TORONTO — For the third time since 2015, Restaurants Canada has taken stock of liquor policies impacting foodservice and hospitality businesses from coast to coast in its biennial Raise the Bar report.

This year’s report reveals a considerable thirst for selling alcohol through takeout or delivery: Seven out of 10 licensed foodservice businesses told Restaurants Canada that they would benefit from being able to sell alcohol to their patrons to enjoy off-site.

“On-premise sales growth has been flattening out for restaurants in recent years while growth in off-premise sales has been skyrocketing. So it makes sense that licensed operators see the case for expanding their liquor sales off-site as well,” said Shanna Munro, President and CEO of Restaurants Canada. “In some jurisdictions, third-party services are already allowed to deliver alcohol, but not restaurants. Liquor laws and regulations need to adapt so that foodservice can keep up with modern market realities.”

Report card on provincial liquor policies points to plenty of room for improvement

Progress has been mixed since the last report card from Restaurants Canada in 2017: Operational realities for licensed establishments seem to be improving in some regions, while getting worse in others.

The full rankings for 2019 are:

Grade Province
B Alberta
B- Nova Scotia
B- Prince Edward Island
B- Quebec
C British Columbia
C Manitoba
C- Ontario
C- Saskatchewan
D- New Brunswick
D- Newfoundland & Labrador

What can be done to raise the bar for licensed establishments?

While most rules impacting how restaurateurs buy and sell liquor come from the provinces, federal policies can still go a long way to help or hinder the operations of licensed foodservice businesses. For instance, the national tourism strategy unveiled this year was a welcome announcement, as it emphasized the integral role of culinary tourism for promoting the Canadian brand at home and abroad.

As a sector made up of professionally trained staff regularly serving customers from across the country and around the world, foodservice provides an ideal setting for showcasing locally produced liquor products. Unfortunately Canada’s beverage alcohol policies currently do more to discourage than encourage licensed establishments from playing this role.

Restaurants Canada is recommending that all jurisdictions either implement or keep in place the following five measures:

  1. Make wholesale pricing available to all liquor licensees, for all types of beverage alcohol products. Currently only restaurateurs in Alberta and on Prince Edward Island have access to discounted wholesale pricing on wine, spirits and beer. Bar and restaurant operators across the rest of the country pay the same as retail customers, and in some cases even more, for at least some types of alcohol.
  2. Modernize liquor legislation to cut red tape and reflect changing market conditions. Outdated laws and regulations that are out of step with modern business practices are still on the books in every province. Liquor rules have not kept pace with evolving market conditions, leaving licensees poorly positioned to survive and thrive in today’s landscape, let alone prepare for the future.
  3. Allow all licensees to sell alcohol for off-site consumption. Why should restaurateurs who are trained and trusted to serve alcoholic beverages within their establishments be restricted from selling those same products to their customers to enjoy off-site?
  4. Introduce or preserve a liquor server wage. A wage differential for tipped workers allows restaurateurs to allocate more towards higher wages for non-gratuity earning kitchen staff, who are typically harder to attract and retain.
  5. Reduce excessive markups on beverage alcohol products. The amount of tax collected on liquor in Canada is among the highest in the world. A cocktail of federal and provincial taxes and fees currently make up: Nearly 50 per cent of the cost of beer; between 65 and 70 per cent of the final price of wine; and up to 80 per cent of the cost of spirits. In 2017, the Canadian government made an already bad situation worse: the federal budget that year not only increased the excise duties on beverage alcohol products by 2 per cent, it also introduced an automatic annual escalator on those duties. As a result, the amount of money that the federal government collects from all beer, wine and spirits bought and sold within Canada has been going up every year since, without having to face a vote in Parliament.

What’s at stake if Canada doesn’t raise the bar?

  • 49,600 licensed foodservice businesses. Bars and restaurants contribute to the diversity and vitality of communities across the country
  • 586,000 direct jobs. Licensed establishments provide gainful employment for many Canadians
  • $9.5 billion per year. A substantial amount of economic activity is generated by foodservice businesses that purchase and sell beverage alcohol

Visit info.restaurantscanada.org/raise-the-bar to download the full report and join in the online conversation with the hashtag #RaiseTheBar2019.

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Media Contact:
Marlee Wasser │ 416-649-4254 │ media@restaurantscanada.org

 

About Raise the Bar

Raise the Bar is a report produced every two years by Restaurants Canada evaluating the impact of liquor policies on bars and restaurants across the country.

Provincial policies evaluated for the 2019 Raise the Bar report were reviewed within the following four major categories and, after analysis and weighting, each province was given an overall letter grade:

  1. Pricing and Selection
  2. Licensing and Regulation
  3. Customer Sales
  4. Political/Regulatory Activity

All survey results featured in the 2019 Raise the Bar report were compiled from more than 700 responses to an online questionnaire that was emailed to foodservice operators across Canada between June 12 and Aug. 26, 2019.

About Restaurants Canada

Restaurants Canada is a national, not-for-profit association advancing the potential of Canada’s diverse and dynamic foodservice industry through member programs, research, advocacy, resources and events. Canada’s foodservice sector is an $89 billion industry that directly employs 1.2 million workers, is Canada’s number one source of first jobs and serves 22 million customers across the country every day.

Marlee Wasser

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