Beer policies were front and centre in premier-designate Doug Ford’s campaign, but implementing his ‘buck-a-beer’ policy and allowing sales in corner stores might not be so simple in Ontario’s complicated beer retail landscape.
The promises are straightforward − lowering the current minimum price of beer from $1.06 to $1 and making beer more accessible for consumers − but some of the regulations in Ontario actually benefit the brewers themselves and removing them may not be a popular move.
Matt Johnston, chief executive of Collective Arts Brewing, a craft brewery in Hamilton, says that lowering the floor price and allowing beer sales in convenience stores could hurt craft brewers across Ontario.
Mr. Johnston said multinational companies would more easily be able to sell beer at the $1 price point, but craft beer would still sell for the current price because of higher labour costs and more-expensive ingredients involved in the craft-brewing process.
“We love the idea of beer being more affordable, but just lowering the floor price concerns us if that’s how we get there,” said Mr. Johnston, who said that craft brewers would need some form of support if the floor price drops. “It will be the multinational corporations who can afford to sell at that price.”
Craft brewers, who are currently enjoying a boom in the popularity of local beer, could also be hurt by the complicated process of selling to individual corner stores. The LCBO currently controls distribution to grocery stores, making the process easier and less costly for brewers.
Those same difficulties would be faced by multinational breweries, but Mr. Johnston says larger corporations would be able to handle the change, where many craft brewers would be hurt.
Some retail organizations say they would gain from $1 beer and are skeptical of complaints about lowering the current minimum price.
Non-craft brewers largely benefit from a higher floor price because their product is taxed the same amount while they charge more. Lowering the floor price without lowering taxes could simply take away revenue from brewers who are able to produce cheaper beer.
Mr. Ford has taken aim at multinational beer corporations, saying that the current floor price of beer only benefits the companies who make a bigger profit margin because of it.
Beer Canada, which represents some of the largest brewers in Canada, said they believe the best way to lower beer prices is to lower the tax on beer, but didn’t respond to an interview request about lowering the floor price of beer.
Karl Littler, a spokesman with the Retail Council of Canada, which represents thousands of retail organizations across the country, said he appreciated that the new government was looking to change the system of beer sales in Ontario that have kept grocery stores from being competitive.
“We thought the time is right whatever configuration of government comes in,” Mr. Littler said.
He believes that allowing sales of 12-packs and 24-packs in grocery stores, expanding sales to convenience stores and allowing more competition in the industry will only benefit the consumer.