[LINK] "Craft Brewers Push Back on Corner Store Beer Sales"

[rfmcdonald]

Torontoist's Brendan Ross notes that, perhaps counter-intuitively, smaller producers of beer--craft brewers--are fine with the current monopoly in Ontario of the publicly-owned Liquor Control Board of Ontario over alcohol sales to the exclusion of (as in Québec) corner stores.

[W]hile the allure of buying booze along with smokes and lottery tickets—not to mention a popular distaste for monopolistic alcohol selling practices—might have some people crying for change, craft brewers in the province prefer the system the way it is.

Ken Woods, the president of Etobicoke’s Black Oak Brewing, says the convenience-store model would lend itself well to large companies with aggressive marketing strategies and the money to pay for premium positioning in corner-store fridges. Smaller brewers, he fears, would be left out.

“Have you ever taken a look in a convenience store and seen any artisanal products, like artisanal potato chips?” he asks. “What convenience stores are great at doing is mass produced products that are very generic, very similar, and have got their distribution set.”

Woods estimates a move toward selling beer in convenience stores would hurt the market share of small, local brewers, and possibly put some out of business almost immediately.

On the other hand, he says the current competition between the LCBO and The Beer Store to offer customers a better tactile shopping experience—exemplified in LCBO product-sampling counters and The Beer Store’s new Beer Boutique locations—steers increasingly discerning customers toward craft beer.

Michael Arnold was involved in a push for booze in corner stores over a decade ago. Now, as the president of Trafalgar Brewery in Oakville, he says he initially tried to help convince the province that the move would benefit craft brewers. But he soon realized it wasn’t his brands the convenience stores ultimately wanted.

“You could just see, they saw us as a lever to get in to talk to the government,” he says. “But what they really wanted was to sell shelf space to Labatt and Molson. They knew nothing about craft beers.”

Like Woods, Arnold says that while the current system could be improved, he would rather work with it. The relatively low distribution fee the LCBO charges helps keep the prices of his beers down. The relatively small amount of shelf space in the average convenience store, meanwhile, would probably drive prices up. Smaller brewers, Arnold thinks, would end up “paying a premium for the bottom right-hand corner.”