The Beer Store unveiled changes Wednesday that it says will create opportunities for small craft breweries and satisfy customers as well. Here are five things you might want to know about the shakeup.
Why was there pressure for change?
Things came to a frothy head after the Toronto Star’s Martin Regg Cohn revealed a cozy deal between the foreign-owned Beer Store and the publicly owned Liquor Control Board of Ontario.
The deal restricts the LCBO from selling beer in larger quantities than a six-pack. It’s now the subject of a complaint by Restaurants Canada at the federal Competition Bureau.
Cohn also exposed the connections between the Beer Store, politicians and political parties.
He noted how brewery facilities were used for political fundraising and how the three major political parties received $525,000 from the Beer Store, its unionized workers and foreign owners in 2013 and 2014. Federally, unions and corporations aren’t allowed to make political donations.
Cohn’s work apparently struck a nerve, as a poll from Forum Research published last Christmas revealed that more than half of Ontarians wanted Premier Kathleen Wynne to strip The Beer Store of its quasi-monopoly.
Who gets to stock their suds on The Beer Store shelves under the new deal?
Microbreweries will have the option of buying into the company and being charged the same fees as Molson, Labatt, and Sleeman to list their brews at The Beer Store.
Smaller Ontario brewers, those selling fewer than 1 million litres a year, will pay no listing fee to stock two of their brews at the five Beer Store locations closest to their brewery.
How does it affect makeup of The Beer Store board?
The Big Three breweries still have most of the control, but now the little breweries get a voice.
Before the change, the Beer Store was run by the three foreign-based breweries which are the offshore parents of Labatt, Molson and Sleeman.
Molson and Labatt retain control the board of directors, with five seats each, while Sleeman has two seats.
Larger craft breweries get two seats and small breweries one.
How does it vary, region to region?
There are currently 448 outlets of The Beer Store across the province.
Now, little Ontario breweries won’t have to pay a listing fee for stocking two of their offerings at the five outlets closest to their operation.
That will almost immediately increase the selection of local beer across the province.
Little breweries will also be allowed to swap brands on shelves so that they can make special seasonal offerings.
When will consumers see a change?
The Beer Store says it’s reaching out to breweries now and changes could be seen on shelves within the next few weeks.
Jeff Newton, a spokesperson for The Beer Store, said the changes mean the number of brands sold at The Beer Store could rise to 650 from 490.
Whether this means cheaper beer is anyone’s guess, as Newton said prices are set by individual brewers.
“Competition in the market will determine what happens on price,” Newton said. “It’s worth noting that because of that inter-brewer competition at the Beer Store, Ontario has the lowest average beer prices in Canada.”
Source:: Metro News
