Hamilton Spectator

Ontario brewers skeptical of Beer Store offer

Keith Leslie (Canadian Press)

TORONTO — Ontario brewers reacted with skepticism Wednesday after the foreign-owned Beer Store offered them ownership stakes in the consortium that controls 80 per cent of beer sales in the province.

“Ownership is a red herring issue the Beer Store is using to distract the media and the public,” said Andrea Woods Chiodo of Flying Monkeys Craft Brewery. “We have always been concerned with shelf space, accessibility, transparency and how store formats affect the retail experience.”

Jeff Fisher, owner of Indie Ale House in Toronto, said he wouldn’t be a real owner under the Beer Store’s offer, which he called a public relations exercise.

“The craft brewers can’t get together and say let’s paint all the stores or let’s sell them,” said Fisher. “You have no real say, so you’re an owner that gets to choose nothing. It does nothing for me.”

Under the Beer Store’s offer, Ontario brewers that sell more than five million litres a year would pay $1,000, and smaller brewers $100, to become owners and get one Class E or Class F share. They are also being offered a total of three seats on the 15-member board of directors of the Beer Store. Molson and Labatt would each have five seats on the board and Sleeman two seats.

“With those three seats they get a say in decision-making and governance of the business on all the operational and financial policy decisions, so there’s a voice that they now get at the table,” said Beer Store spokesman Jeff Newton. “And when they come in as owners, they’ll be treated financially the exact same way as the large brewers are treated.”

The Beer Store’s offer is meant to “take the heat off” the big brewers in the face of a government review panel’s recommendations to overhaul Ontario’s beverage alcohol system and charge a fee to the consortium, said Fisher.

“It’s a smoke screen to give the premier some cover to duck and do nothing,” he said. “And it really takes away from the only question that never gets answered: why can’t there be competition?”

The industry association Ontario Craft Brewers said the Beer Store announcement about opening ownership “came as a complete surprise” and does not address the key issue of improving access for consumers.

“Our goal continues to be fundamental change to Ontario’s beer distribution channels,” said Cam Heaps, chairman of Ontario Craft Brewers.

Matt Johnson of Collective Arts Brewery, which is teaming up with Nickel Brook Brewing to open a new facility in Hamilton, said the Beer Store is reacting to demands for change from craft beer drinkers.

Craft beer is limited to just four per cent of the Ontario market, versus 14 per cent in British Columbia, because of the Beer Store’s outdated retail model that “doesn’t provide much of a shopping experience,” added Johnson.

“The problem everyone has with the Beer Store is it’s designed to support the large brands of its multi-national owners,” said Johnson. “For the Beer Store to truly have change that is beneficial to craft brewers you need to have all of the stores with a self-serve so consumers can see the products on shelves.”

The LCBO does a much better job of retailing craft beer, but should add more Ontario products to its shelves in place of international beers, added Johnson.

See the full article here.

Leave a Reply

XHTML: You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Collective Arts Brewing