Toronto, August 20, 2014 – Restaurants Canada applauds a C.D. Howe study released today that calls for major reform of Ontario’s antiquated system for wine, beer and spirit sales. The report finds that a lack of competition is causing higher prices, less choice, and lost government revenue.
In a bizarre example, the LCBO and The Beer Store quietly signed an agreement several years ago that handed The Beer Store exclusive rights to sell beer in volumes greater than 6-packs.
Cancelling this agreement and allowing the LCBO to sell beer in 24- and 12-bottle cases would be a win for consumers, business owners, and government tax coffers:
- LCBO revenue could rise by as much as $500 million a year, according to Restaurants Canada estimates;
- Consumers would benefit from added convenience and volume pricing when purchasing beer at the LCBO;
- Licensed restaurant and bar owners, who currently pay up to $10.80 over retail price for a 24-bottle case of beer, would see a more fair and equitable pricing system.
“It’s ludicrous that our licensed members in Ontario pay on average 30% more than retail for a case of beer,” says Garth Whyte, president and CEO of Restaurants Canada. “The Beer Store’s artificially high prices cost our industry an extra $75 million annually.”
While major changes are required to bring better choice, convenience and pricing to Ontario consumers and businesses, expanding the LCBO’s beer selection would be a good first step. “It’s time to allow the LCBO to compete with its competitor,” says Whyte.
A chart showing the discrepancy between retail and licensee beer prices is available at: https://www.restaurantscanada.org/Portals/0/Non-Member/2014/beerprices_2014.pdf
Restaurants Canada is a national association comprising 30,000 businesses in every segment of the foodservice industry, including restaurants, bars, caterers, institutions and their suppliers. Through advocacy, research, and member programs and services, Restaurants Canada is dedicated to helping its members in every community grow and prosper.
Canada’s restaurant industry directly employs more than 1.1 million Canadians, contributes $68 billion a year to the Canadian economy, and serves more than 18 million customers every day.