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Privatization of LCBO

I took a trip to Boston for the long weekend. The city reminded me much of Toronto in many ways. We enjoyed some spectacular meals. The prices on the wine list were so radically lower than Toronto restaurants that it made me long for privatization of the LCBO. Sigh ... And we loved being able to take home unfinished bottles of wines. Do you think widespread use of that option will be on the horizon in Toronto anytime soon?

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  1. Yes. Probably. Maybe. Possibly. No interest in whacking the LCBO pinata.

    1. The option to take home unfinished bottles of wine is already available in Ontario. See the FAQs about "Take Home the Rest" on the AGCO page: http://www.agco.on.ca/en/faqs/faqs_ll...

      Relatively few restaurants seem to be actually offering it to patrons but the option is open.

      7 Replies
      1. re: Jacquilynne

        It's not that simple. Before allowing a patron to take home, the restaurant must put the cork back into the bottle flush with the top. This cannot be done by hand and requires a corking machine which most restaurants don't have nor care to purchase. Without this condition, the option is NOT open.

        1. re: syoung

          T-corks fit many bottles.
          And there are cone shaped corks around for anyone who wants to offer this.
          No where does the legislation say it must be the same cork.

          1. re: estufarian

            However, according to the AGCO:

            "Restaurants offering THTR are required to reseal the bottle in such a manner that it cannot be readily re-opened and consumed while in transit."

            A T-cork would not fit this requirement. The requirement to reseal of the cork flush with the top of the bottle is so that it cannot be readily re-opened without, say, a bottle opener.

            What it doesn't say is what happens if the original seal is a screw cap and there is no cork. This would be an interesting, if not frivolous court case.

          2. re: syoung

            I have no difficulty whacking a cork with the heel of my hand and making it flush with the top of the bottle

              1. re: kagemusha49

                I've done and seen this done with undesirable results and if I was a restaurant owner, I would not recommend my staff risk injury by whacking bottles. It needs to be done properly with the right tools or not at all.

                1. re: syoung

                  Um - I'm 64 and have shoved corks in many many bottles with the heel of my hand and have never ever had a problem. It's not the bottle that gets whacked, it's the cork by a soft part of my hand. What's next? Federal regulation of reinserting corks and a required 3 year program before we are allowed to do this?

          3. Privatization would do nothing about the price of wine and booze. Our prices are primarily determined by the level of taxation not by overheads introduced by the retail channel

            By way of comparison, our usual vin du pays currently retails for $9.95 in Ontario, previous vintages of the same wine have been as cheap is $7.90. I checked several wine stores in Edmonton, the same wine ranged from 9.95 to 12.99

            The nicest and biggest liquor store in Edmonton is about the same as any large LCBO, more tightly packed, less organized, a different selection of stuff but not more stuff just different. The worst liquor store I've ever been in in Calgary was a joke, they had exactly 36 SKUs of Canadian wine and no wine of any sort cheaper than $15, but they did have 190 proof Everclear.

            6 Replies
            1. re: bytepusher

              How much was the Everclear? Was it kept under the counter, or behind the cash as in the US?

              1. re: Dean Tudor

                I don't remember what I paid for it sorry

                I think it was just out on a shelf, but I'm not 100% certain, the bottle I bought in Tennessee (only to have the TSA confiscate it from my checked luggage, grr) was just out on the shelf too

                More recently in the places I went to in Edmonton if they had it it was in a locked cabinet with the $$ scotch

              2. re: bytepusher

                According to LCBO, taxes and levies represent about 33% wine prices and LCBO markup is about 30% with the remaining being product cost, so privatization could impact prices by adjusting the margin, in theory.

                I say "in theory" because of regulation by the Liquor Control Act that gives the LCBO sole power to set prices according to Section 3(1)(i). In fact, the LCBO also has sole power to control what products are sold, storage, packaging, marketing, etc., basically the entire supply chain and administration.

                Thus, privatization without deregulation makes no sense. Without deregulation, private retailers would just be a front for the LCBO. In other words, pointless.

                1. re: syoung

                  If the markup is only 30% why do they charge 102% on imports? It's the same legislation.

                  1. re: estufarian

                    Sorry, I should've been more precise... I meant LCBO markup is 30% of cost of a $10 bottle of wine according to LCBO themselves. I don't have inside info.

                    1. re: syoung

                      That computes to a 43 % markup - still lower than the LCBO themselves admit to in the link supplied by dubchild below.
                      And 'taxes' are on top of that!

              3. Our wine prices are a reflection of our tax system.

                That being said, it is time to ditch unionized public sector companies. To believe the only pitch that they somehow are better at "protecting" us, is insulting to any non-union worker.

                As Martha might say "It will be a good thing".

                17 Replies
                1. re: PoppiYYZ

                  I would disagree with you on this. I'm a public, unionized worker and I can tell you that the union does a couple things. First and foremost, it makes it easier on the employer to deal with the work force as a single unit rather than, in my case 700 hundred individual units. There are also multiple different bargaining units where I work totaling tens of thousands of employees.If they dealt with them individually, that's all they'd have time for.

                  Secondly, and I can already see a few eyes rolling, is it's about balance. Unions can help keep the gov't entity in check. As we know, we love big government up here. Every time they point at us and say "We can cut this" we point back and say "You can cut that" if you get what I'm saying.

                  Anyway, there is no perfect system but I believe a massive work force should be unionized. It's just simpler.

                  Anyway, we already pay through the nose at the LCBO. Do you really want to privatize it?? Now who ever owns it will have to raise costs to make a profit. Every dime we pay goes to costs and taxes. Nothing towards profit. (or if there is one, it goes to the gov't coffers, not someone's pocket)


                  1. re: Davwud

                    I have nothing against Unions, just don't like them when they are in a monopoly and I don't have another option.

                    Privatize the LCBO, Ontario will still collect taxes and license fees, and I will have some competition to select from.

                    1. re: PoppiYYZ

                      Your other option would be, in my case anyway, cheap and lousy work. We contract out work to the lowest bidder all the time. The amount of money we spend to fix their pathetic work is more than they saved.

                      Privatization of the LCBO may lead to better selection but it will come with higher prices.
                      And making regular trips south of the boarder, outside of price/value, I DO NOT find the grass any greener.


                      1. re: Davwud

                        That is exactly why we should relieve the Ontario Government from the responsibility of managing liquor sales.

                        Let the multitude of new owners manage the unions and their businesses, and let us decide which ones are doing the best job.

                      2. re: PoppiYYZ

                        And then you woke up...Your recipe would indeed affect prices and I doubt you'd like the direction they'd take.Read syoung and Davwud above.

                        1. re: Kagemusha

                          Yeah, I guess you are right. Competition always screws things up, Unionized Monopolies rock.

                          I placed special order for a French wine and the LCBO charged me $152.70Cdn per case and foolishly attached a copy of their invoice showing they paid $41.13Cdn per case. A 371% mark up.

                          1. re: PoppiYYZ

                            Can you post a copy of the invoice?

                            1. re: Kagemusha

                              Hi K,

                              Yes I can. I also have the LCBO "Purchase Order Terms and Conditions" and the "Supplier PO Requirements" issued to the winery. LCBO price was 31.80 Euro per case of 6 bottles (Cdn $41.13 at that time). Minimum order was 5 cases.

                              The PO has the LCBO employee names and phone numbers on it so I am a little uncomfortable posting it. I did call and raise hell about their rediculous "mark up", and was snarkliy asked "Do I want the wine or not". It was a special wine for a special occasion so I reluctantly sucked it up (pun intended).

                              Still have some of the 30 bottles left and having a bottle tonight in fact....

                              1. re: PoppiYYZ

                                If you've actually got the PO in question, just redact those parts. Otherwise...

                                1. re: Kagemusha

                                  Just post the relevant numbers, showing how the original cost got converted to the price you paid. If I can find one of my originals I'l do the same - except it's probably 10 years since I gave up on private importations.
                                  Somewhere I also have the 'calculation matrix' provided to me for 'personal' importations (i.e. those brought in as accompanied luggage). While not the same (no shipping cost or brokerage fees) it does show the major compomnents.

                                  1. re: Kagemusha

                                    Otherwise what ? You won't believe me ?

                                    I have it. The PO has the PO number, my name, the wine name, the date, the store it was shipped to, supplier number (likely new), item number (very likely new), price, total value, and all traceable to me.

                                    Plus this from the PO :

                                    33 Freeland Street address,

                                    LC Private order in the top left corner,


                                    Please acknowledge receipt of Purchase Order within 72 hours. You must also notify us by separate communication, of the exact date that goods will leave your warehouse. When sending telex/fax messages, acknowledgements and documents, please quote our purchase order number. Note carefully the Conditions of Purchase on the reverse side hereof, which form part of this Purchase Order. We hereby request delivery of the products listed below in satisfactory condition.

                                    ** EX CELLAR ** the supplier will make goods available for pick-up at their designated loading point. All charges from this point, for export clearance, haulage, insurance, etc., will be for the account of the LCBO.

                                    ** FOB ** (PORT) the supplier's invoice price includes all charges (ie. customs clearance, transport) up to and including loading on board vessel at designated port of shipment.

                                    **FCA** the product being delivered by the supplier, at their own expense and cleared for export, to the LCBO freight forwarder's warehouse for consolidation and shipment.

                                    I don't lie.

                                    1. re: PoppiYYZ

                                      I wonder if they had to test the wine? I know that each new wine has to go to their lab for testing.That's not cheap.

                                      1. re: mariecollins

                                        If it's less than 5 cases (on a private importation), one can sign a waiver on the testing.
                                        Above that, it must be tested.

                                        1. re: estufarian

                                          Interesting. They didn't mention testing, provide results, or offer a test waiver. Their minimum order was the 5 cases though.

                                          Thanks, will know to ask if there is a next time.

                              2. re: PoppiYYZ

                                The mark up is on the landed cost - so it's in the LCBO interests to pay as much as possible for shipping. I can't locate my last importation but I think the mark-up on the landed cost was about 130%. And I know there was also a 'Broker Fee' (unavoidable) to handle the paperwork for clearing customs & Excise - the mark-up might also have been applied to that.
                                My rule-of-thumb is that landed cost is about 2.5 * original cost - but I probably bring in (or used to - the cost was just too high so now the Ontario Govt gets zero from me) more expensive wine, which gives a lower % mark-up as some costs are relatively fixed.

                                1. re: estufarian

                                  Really ! Does the LCBO have their own shipping company ?

                                  I gotta believe they are making something off that angle too. Interesting to find out who they use and who owns the freight company.

                                  Any CBC reporters following...

                                  Edit : Just ran down to check my two remaining cases (sadly both not full) and there is a packing slip from France on one of them but no mention or markings on the cases who did the shipping. Very Interesting.

                                  I would love the opportunity to deal with a liquor store owner who I felt had MY best interests in mind. Not the current system.

                        2. re: PoppiYYZ

                          The important thing about LCBO is that the profits go back into the government coffers, thus in the long run reducing general taxes. If you privaitsed LCBO those profits would be lost and our taxes would go up.

                        3. I think what the LCBO needs is what happened somewhat recently with the TTC, which is some sort of consumer advocacy group. They could draw up a consumer bill of rights.
                          As much as I think there are positives to the LCBO, I wish they were more of a service and less of a "our main concern is the bottom line" type of business.

                          1. As many have said before, the cost of wine and liquor is a tax issue. So even if it were made a private company, costs would be the same or higher. I don't know a single company that would lessen prices at our tax rate. Especially with no competition. The local wineries wouldn't (why would they.) The international fees are horrendous, as I know from people over seas that would love to sell here. The government would have to make changes, again why? They make money. Also the states system isn't as cheap or transparent as it seems. The costs are just transferred to the licensees and distribution lobby.

                            2 Replies
                            1. re: LexiFirefly

                              "Also the states system isn't as cheap or transparent as it seems. The costs are just transferred to the licensees and distribution lobby."

                              I'm not sure I understand this at all. First of all, all I care about is how much money I'm spending. I could care less about transparency. Secondly, if I have 2 identical bottles and 1 is $10 because it was bought in the states, it's $10 cheaper. It's not like in my elation of it being cheaper someone is slipping a sawbuck out of my wallet to make up the difference.


                              1. re: Davwud

                                It's more for beer than liquor. The distribution companies that sell to the private stores are owned by the big 3. So really the choices aren't much better than here despite their great group of micro breweries.

                            2. Virtually every reply misses the point.

                              1. LCBO, as a business loses money every year and cost the taxpayers dearly. The LCBO employee union runs deceptive ads about how much money they bring in. The fact is that most of the money is taxes that would be collected by private liquor stores. The LCBO operation lose money. Only a government run business could have a monopoly on liquor and still lose money! They manage to do this because 1) they pay ridiculous wages to people doing minimum wage jobs and 2) for political reasons they have to have outlets in every little village and town, even if it they lose money. I know an isolated town of 400 in the middle of nowhere that has an LCBO store which is virtually empty outside the summer months. It's no coincidence that the major opponents to privatization are these small towns that would likely lose the store and the overpaid union workers. In other words, the people who benefit most at taxpayer expense. (The small town problem could easily be remedied by allowing sales of beer/wine in grocery stores.)

                              2. Getting rid of a monopoly. Yes, liquor taxes won't change. But maybe, just may maybe, getting rid of the government monopoly would allow private stores that don't have the ridiculous salaries and unprofitable stores and that actually have to compete in the marketplace with each other to charge lower prices, to conduct real sales, and to stock more variety.

                              3. Big payday for taxpayers. The liquor taxes would still be collected even if the LCBO did not exist. No loss there. And in the short run, there would be a huge financial gain. The LCBO is as much in the real estate business as in the liquor business. Selling off the stores and liquor licenses would bring in billions of dollars to taxpayers.

                              4. Get the government out of your life. Lastly, why in world should the government be in the private liquor business? It's none of their business any more than they should be owning all the clothing stores.

                              Logic and the best interest of consumers and taxpayers says privatize the stores. Political pressure for rural areas and the unions has kept this from happening. As is usual, the special interests groups are better organized and get their way at our expense because we do not speak up. This is probably typical Canadian pacifism. If there was no public outrage over the HST or the the government gouging us with the land transfer tax, I guess that it isn't surprising the the LCBO is allowed to persist. After reading this thread, however, I can also see that a lot of people are clueless about the issues.

                              23 Replies
                              1. re: evansl

                                "4. Get the government out of your life. Lastly, why in world should the government be in the private liquor business? It's none of their business any more than they should be owning all the clothing stores."

                                Clothes abuse doesn't incur massive costs to our health care system every year

                                1. re: disgusti

                                  Many European countries along with the state of Massachusetts mentioned in the OP have universal healthcare costs to consider also, but somehow find a way to stay out of the liquor business. So I do not see the correlation.

                                2. re: evansl

                                  There are facts are there is fiction and there is definitely an abundance of fiction floating around this discussion.

                                  my advice for those who are interested in facts rather than rhetoric is look at the link for the LCBO which lists their financial performance.

                                  and a study done by York university looking at the impact of privatizing the LCBO. The advantage we have is that we can look at Alberta as a comparison.

                                  1. re: dubchild

                                    1) The York U "report has been prepared for the Ontario Liquor Boards Employees' Union". Yeah....

                                    2) "Alberta as a comparison" meaning that there is someplace doing a poorer job than the LCBO ? Let's compare to the best instead.

                                    1. re: PoppiYYZ

                                      If the York U report has misrepresented facts or number, can you point to which ones specifically. It would be more useful.

                                      If there is another comparison where a state liquor board was privatized where the results were better, can you offer it.

                                      1. re: dubchild

                                        how about BC? they're making money hand over fist with their system.

                                    2. re: dubchild

                                      Just a quick look so far, but I highlight this quote from the yorku study
                                      "The markup on imported wine is typically 70% (as shown in the table) of the total landed costs, but in general it varies from about 60% to about 115% of landed costs."
                                      Unfortunately, the table referred to is not included in the study (at least I couldn't find it) - and this report was prepared FOR the Union, so that number may well be low (it certainly needs to be adjusted UPWARDS for the sleight of pricing that occurred with the introduction of HST, where the 'promised' reduction from 23% (5% GST and 18% PST) to 12% (which the legislation provided for) was 'compensated for' (my words - I'd like to use stronger words) by adjusting the markup so that no price reduction occurred - i.e. an additional 11% on the already marked up price - you do the calculation!

                                      I haven't analyzed the LCBO numbers, but a quick glance has me wondering how a 50% margin (claimed) and 16% cost of sales - claimed (i.e. that leaves 34% Cost of inventory) can be reconciled with the 'about 100%' mark-up. Doesn't that imply the price (100%) is 3 times the cost? (All the above apparently exclude sales taxes, according to the data provided).

                                      1. re: estufarian

                                        Very important is to understand the difference between "markup" and "profit margin". (Not to say you don't) The terms appear to be used in the thread interchangeably and when referenced but they are completely different. If LCBO buys a bottle for 50 and sells it for 75, the markup is 50% but the profit margin is 33%. Just pointing this out for anyone feeling lost in the numbers.

                                        1. re: justsayn

                                          And then there's the difference between revenue and profit, no?

                                          1. re: Kagemusha

                                            Hugely! I didn't notice a blur to that effect.

                                            1. re: justsayn

                                              The LCBO financial statements are available. Let's start(and end) there.

                                          2. re: justsayn

                                            "50.3 LCBO's profit margin, expressed as a percentage

                                            16 LCBO's operational expenses as a percentage of net sales, in 2012-13"

                                            These are on consecutive lines in the same section (Financial Performance) of the report.

                                            If, indeed, these are expressed as percentages of DIFFERENT numbers (i.e. the 50.3 is NOT of net sales) this is, at best, misleading, and certainly contravenes the CICA guidelines for statement (and hence notes) preparation. I'll run the numbers though when I have more time.

                                            1. re: estufarian

                                              I wasn't clear on the goal of these posts. Maybe it is to illustrate that some numbers presented as fact are actually rhetoric. My suggestion is if you have evidence, then present it to an ombudsman or whoever deals with that.

                                              The main point of this discussion, at least to me, is that the LCBO is either a good thing or not. Some hounds fall into the pro camp, other feel privatizing would be better.

                                              I posted the links because I was concerned by how many responses didn't seem to be based on anything. In the interest of balance here is another study I've skimmed through. This one is by the Libertarian think tank, the Fraser Institute.


                                              For those who don't want to spend their Sunday going over it with a fine toothed comb, here is a copy of their conclusion. Of course some subtlety may be missing.

                                              "In assessing the overall effects of Alberta's privatization of liquor retailing, one can examine the impacts on the various parties affected by privatization. First, consumers have experienced price increases (on average) for beer, wine, and liquor, but the larger number of liquor store locations under privatization has implied lower transportation and transactions costs for many consumers. Retail price dispersion and retail price competition now exist so that it is possible for consumers to shop around for lower prices. Overall product selection has increased, although consumers might have to shop around for their preferred product (particularly for wine products because a given liquor store will only sell a fraction of the large number of wines now stocked in the warehouse). Second, beer, wine and liquor suppliers are better off as a result of their improved access to the market in Alberta, but their costs of serving the market have likely increased. Suppliers must now sell their products to individual liquor stores or liquor store chains as opposed to a single buyer, the ALCB. Third, the Alberta government appears to be no worse off as a result of privatization given that its liquor-related revenues have not declined.

                                              Fourth, former ALCB employees have lost their union jobs, and have either taken nonunion jobs in private liquor stores at much reduced wages, or have sought employment elsewhere. Fifth, employment in private liquor stores is about triple the employment in ALCB stores, so there is no question that privatization has created jobs (even if at wages below the former ALCB wages). Sixth, hundreds of new small businesses have been created as a result of privatization, and these businesses are generating income for their owners and employees and tax revenues for the various levels of government. Finally, there is no evidence that the residents of Alberta have been exposed to increases in crime or liquor-related offenses as a direct result of privatization. Indeed, some survey evidence is available that suggests that Albertans are generally satisfied with Alberta's privatization of liquor retailing."

                                              1. re: dubchild

                                                For the most part I read into that that neither way is better. Just different.


                                                1. re: Davwud

                                                  They are definitely different. Which way is better, seems to me, to depend on which type of consumer you are. If all you care about is getting run of the mill stuff at your corner store at a price which, on average, may be higher, and if you don't mind shopping around looking for bargains or having to visit select stores to get some, how should we say, more special wines and products, then maybe the Alberta model is better.

                                                  On the other hand, if you live in a remote community or don't like shopping around for lower prices and want to pay, on average, less for a good selection which is more widely available, then maybe the LCBO is better.

                                                  Given that I don't drink Laker Ice at two in the morning, I think you can guess which one I prefer.

                                                2. re: dubchild

                                                  Liquor stores in Alberta and BC are horrible. They're cheap, tacky, and often unkempt. We're fortunate to have the LCBO, as they give us respectable places to shop, although not all of their staff are the most knowledgeable. But, as food and drink aficionados, we typically know what we want anyway.

                                                  The only issue I have is with the restrictions on importation of wine, but that's a matter to take up with the provincial government, not the LCBO.

                                                  1. re: justxpete

                                                    Holy shit shopping for liquor in British Columbia is an uncivilized unreasonably expensive proposition

                                                    1. re: disgusti

                                                      Seriously. It's absurd. We don't know how lucky we are.

                                                        1. re: PoppiYYZ

                                                          As is Alberta. Lived in Calgary for a year.

                                                      1. re: justxpete

                                                        It's actually kind of all over the map, I think I already mentioned that when I was recently in Edmonton I did a little shopping around and there are a some decent stores run by the Liquor Depot chain, under their Wine and Beyond brand, if you don't mind driving 1/2 way across the city to get to one (there are only 2)

                                                        However the vast majority of the market is dominated by Real Canadian Superstore (aka Loblaws) and they are about what you would expect if what you expect is a liquor store that looks like the worst No Frills locations.

                                                      2. re: dubchild

                                                        With respect to your first point I HAVE progressed further.
                                                        Ombudsman doesn't help - it just gets you a copy of the calculations. These are clearly available (and I have my own examples).
                                                        I attempted to get copies of the legislation with regard to the 'adjustment' that occurred when HST was introduced. The Ontario Government referred me to the Feds as they handle HST. The Feds referred me to the Ontario Govt as they (Feds) only implemented the rules provided by Ontario. NEITHER gave me a copy of any legislation to support this. I pushed harder, using copies of the requisite acts and finally got an 'explanation' (NOT in writing - they refused to do that) that it was passed by 'REGULATION' = there are a bunch of these and they are NOT required to be published in the Ontario Gazette, as they are not introduced into Parliament.
                                                        So it's all 'hidden from public eyes'. Indeed an appeal for copies of the regulations (whether Ombudsman or not) might well release the documents - but what happens then? We have the 'facts' but there's nothing that can be done. If, for example, the LCBO adds an extra 30% to ALL prices (or its markup) it's still within their legal powers (probably, as liquor is a Provincial responsibility) to do so - at best I'd force them to introduce a parliamentary amendment which can raise the taxes retroactively anyway.

                                                        There are various avenues that could be followed (legally) but they would be very expensive without any prospect of significant savings - but this is probably not the place to discuss them.

                                                        As to further documentation, I recall that under McGuinty a further study was done (but never published?) - clearly nothing happened as a consequence, but I'd sure like to see the results.

                                                        1. re: estufarian

                                                          The way around not getting anything in writing is to do a FOA request. Then they have to (and will).

                                            2. Sorry, folks, but we've removed a digression that wandered into which city has the better food and various other amenities, all off topic for the discussion at hand.

                                              4 Replies
                                              1. re: The Chowhound Team

                                                I think discussing how other Provinces, States and Countries manage liquor distribution is very relevant to this discussion. We should learn and pick the best ideas from each and implement them here.

                                                1. re: PoppiYYZ

                                                  Don't know if you're familiar with what was deleted but there was a digression into which city has better restaurants. TO of Beantown. Not at all relevant


                                              2. At the end of the day it was a great trip to Boston. With a reasonable fare from Porter, hotel deal and much lower restaurant tabs it seems unlikely that I will do a Toronto stay cation during summer again. I dashed off the original post too quickly. I simply should have said that after so many years of wining/dining in Toronto I have been almost conditioned to accept the hiked up prices for wine. It was such a delightful change of pace to be in Boston where the wine lists were priced radically lower than here. In fact if I added up how much I saved in wine fees alone - I think it may have paid for my trip. And it got me thinking that privatization was the cause. I appreciate the comments as it was something I had not much understood.

                                                1. If you want to see some crazy (low) wine prices, head to Philly.

                                                  I recall a trip to see a Dali exhibit years ago, we picked up a half case of Newton Epic Merlot for about $20 (it was a 'chairman's special') only to see it in vintages about a year later for $85.

                                                  Biggest alcohol buying power in the world and the highest prices....seems logical to me!

                                                  1. The sooner we can privatize this communist floatilla, the better for consumers.more choice, more options, more yumminess.
                                                    less LCBO commercials on the radio, less magazines. less horrible customer service at the stores.

                                                    and please don't forget The Beer Store. that needs to be the first to go. it has ZERO place in Ontario. it is run by 3 mega-corporations (none of them Canadian) and they keep the small breweries out and promote their own horrible swill. plus, they smell really really bad.

                                                    2 Replies
                                                    1. re: atomeyes

                                                      "The sooner we can privatize this communist floatilla, the better for consumers.more choice, more options, more yumminess."

                                                      Again, in my travels, that just simply isn't the case. Don't mistake different choices with better or more choices.


                                                      1. re: Davwud

                                                        The LCBO is grossly mismanaged. They tell wineries to raise their prices, they accept Air Miles when there is really no competition, their employees are unionized which makes no sense in this world, and on and on.

                                                        But, my biggest beef with the LCBO is the fact that I can't just buy booze anywhere any time like in Australia. We are in the 18th century with the way liquor is controlled in this province. And, don't get me started on the fact that the Ontario Government gives foreign companies a monopoly on most of our beer distribution through the beer store.

                                                    2. A few points in the LCBO's favour.

                                                      Full time salaries are fair but not extravagant - clerks and office staff top out at about $20/hr.

                                                      LCBO markup is stated as 30% somewhere above. I don't know of any retail operation that works at less than 50. The LCBO is the largest single account for many producers here and abroad. Would a fragmented private segment negotiate the same price? We can be certain that the tax portion of a bottle would remain the same. I see an immediate spike in prices with the demise of the LCBO.

                                                      The LCBO has rigorous QC and when I buy at my outlet I know that the distribution chain is secure. Counterfeit product is a problem in other markets.

                                                      On a purely selfish note I am well served even in our tiny limited market of 22,000. My store has an amazing choice. Anything they don't stock, they will bring in for me, at regular price, in about a week. I see private operations offering only best sellers that turn over quickly. Something on the order of rural "agency" stores.

                                                      The LCBO is an excellent source of paper bags.

                                                      14 Replies
                                                      1. re: DockPotato

                                                        You are way off on your margin assumption of 50%. Margins at grocery stores are paltry and Costco limits their mark up to 15%. Then there's the electronics industry like Best Buy. Your 50% + is found in some sectors yes, but not where the big dollars are.

                                                        1. re: DockPotato

                                                          LCBO is also stated as 102% above!

                                                          And an analysis of the LCBO's own data suggests it's even higher (see my response to dubchild above)

                                                          1. re: DockPotato

                                                            I'm not disputing that I'm being overcharged. The LCBO markup is in fact just over 50% as shown in this example:


                                                            Indeed, my 50% example is for a small merchant, but that's exactly what I would see in my case. I've not been in a Costco since leaving Toronto in '04 but didn't seem blown away by its selection in any specific category. Prices and broad range, yes but not much choice.

                                                            Now let's see what some of those "paltry" markups in big box stores amount to. I see from its online flyer that Loblaws at Empress Walk will sell me a 5 lb bag of Ontario potatoes for $3.49. Well last weeks wholesale price in Toronto was $2.24 - mere 56%. And that's on special. Oh, and their Spanish Onions @ $1.29 lb sold at a high of 32 cents a pound. You do the math.

                                                            This is a valuable site I refer to at times which I now share.


                                                            1. re: DockPotato

                                                              I see. I didn't look at it that way. Let's base the supermarket margin on your few items listed and look past Costco because you haven't been in one for 10 years. And let's not even talk about Best Buy et al. Now I get the formula. Thanks!

                                                              1. re: justsayn

                                                                Thank you IMO, but hopefully I can dissect BestBuy et all as well. On the matter of "Brown , "White", and "Hard" goods (electronics, appliances and other hard goods) retailers. I can offer some personal experience having worked at retail ad agencies in another life.

                                                                In my time, a major dealer covered only his expenses through markup - and hopefully a bit of profit.

                                                                A big income stream was the financing on a large ticket item. The retailer received a decent commission from whichever finance company provided the credit. Slowly it dawned on these operations that some heavy profit was available and from that sprang the private card business. Credit, whether inhouse or on contract is a hidden and major revenue generator and this knowledge is easily verified.

                                                                A major revenue source for name brand dealers was "Co-op" advertising. It worked like this.

                                                                A brand's logo and copyrighted name had to appear. In return, the merchant was reimbursed for the percentage of the exposure devoted to the brand. The dealer submitted his media invoices each month based on casual rate and cheques flowed accordingly.

                                                                Volume discounts are available for local and national advertisers based on annual consumption, be it broadcast, print, direct mail or what have you. They were sizeable and represented my clients' major take home.

                                                                Also, I neglected to mention "shelf fees" in my prior post about food markups. That's another topic.

                                                                1. re: DockPotato

                                                                  While madly lumping everything under product markup, you overlooked the Costco membership fees! Now you can fully rationalize your belief that no retailer works for less than a 50% markup!

                                                              2. re: DockPotato

                                                                Thank you for the table.
                                                                Just want to point out that NONE of my imports (as I said elsewhere, I no longer import privately - too expensive), have a 'wine levy' or 'bottle levy' - adding these to the mark-up takes us over 100% (as has been claimed throughout this thread). Only the names have been chnged (?to protect the guilty?). Can anyone show me where/when the legislation was passed to implement these new 'taxes'? My subscription to the Ontario Gazette (where it is a REQUIREMENT that legislation is published) has expired - although it is available at some libraries. NOTE: The requirement to publish (broadly) is because an individual needs somewhere to reference to avoid 'breaking the law' accidentally (which is not an excuse).

                                                              3. re: DockPotato

                                                                "A few points in the LCBO's favour.

                                                                Full time salaries are fair but not extravagant - clerks and office staff top out at about $20/hr."

                                                                Seeing as many LCBO staff are about as knowledgeable and passionate as the average Starbucks employee, and some are far worse than anything I've ever seen in a coffee shop (and I've worked in a few), I'd have to say, anything significantly over minimum wage is significantly more than the level of value they provide.

                                                                1. re: trombasteve

                                                                  Not necessarily true, we used to have a great wine professional at our local, but he got movrd. I miss him.

                                                                  1. re: LexiFirefly

                                                                    No doubt there are good ones, but, on the whole, I'm sticking with the Starbucks comparison.

                                                                  2. re: trombasteve

                                                                    Speaking of lack of knowledge, I went into an LCBO store and asked if they had a magnum of a particular wine and he scratched his head and said what do you mean "magnum"??

                                                                    I'm sorry but anyone who doesn't know what a magnum bottle is shouldn't be working at LCBO.

                                                                    1. re: trombasteve

                                                                      Idiot occurrence is fairly constant across all occupations and salary levels.

                                                                      As long as someone shows up on time, keeps a civil tongue, keeps hands out of the till and does a full day's work he deserves a living wage especially in a profitable enterprise.

                                                                      As a matter of interest, just what does Starbucks pay staff and how much can a staffer earn in tips, Tromb? How effectively does it play the "casual" game to avoid certain responsibilities?

                                                                      1. re: DockPotato

                                                                        When I worked for Starbucks (five years ago, and in Montréal, which is actually a slightly different branch of the company), it was a titch more than minimum wage, and the tips probably pushed it up another dollar per hour. (I was at a busy location.)

                                                                        Actually, to Starbucks's credit, they also have a dental plan if you've been with them for more than six months, which I was surprised to discover.

                                                                        As far as playing a "casual" game to avoid certain responsibilities goes - I'm sorry, I'm not sure I know what you mean.

                                                                        1. re: trombasteve

                                                                          Many businesses employ only part time or casual labour in order to escape certain obligations. Mostly these involve holiday pay, premium pay for stat holidays and ease of termination - if business drops they can chop staff by not offering hours and escape termination pay.

                                                                          Starbucks is to be lauded for its dental plan. That can add a couple of thousand tax free to a person's pocket.

                                                                  3. I spend some of my time in the States. A few months ago, a liquor retailer in Florida arranged for two bottles of Ransom Old Tom Gin to be brought in from Oregon (I don't drink Gin, but this is REALLY something special and sadly not available in Canada). They were almost excited about doing something special for a Customer.

                                                                    It was quick, private order, reasonable, and I paid stupid duty/tax/extortion at our border coming in after a five week trip.

                                                                    Yeah. The LCBO system is broken, they are not servicing their Customers satisfactorily IMHO.

                                                                    1 Reply
                                                                    1. re: PoppiYYZ

                                                                      I think they're doing great. I wouldn't change a thing.

                                                                    2. It was my understanding that any privatisation of the LCBO would be only the "Distribution" not the importation and warehousing. So basically any private distributor would still have to buy their liquor from the LCBO warehouse so they would still control pricing, quality and brands available.

                                                                      1 Reply
                                                                      1. re: pourboi

                                                                        This is exactly what I said above. Privatization has to come with deregulation or it means nothing. Without de-regulation the "private" store would just be a front for the LCBO. A wolf in sheep's clothing.

                                                                      2. I've spent the last month in BC, which introduced private liquor stores a couple of years ago and while I can't really speak to the effect it had on pricing, I can say that at least in Prince George, it resulted in a proliferation of tiny, scuzzy looking stores selling nothing more than the most mainstream of mainstream liquor. The old government liquor stores were not all that nice in PG, but the new private ones are so much worse. I can't say that's an attractive prospect.

                                                                        4 Replies
                                                                        1. re: Jacquilynne

                                                                          Yup. Found much of the same in BC and Alberta (http://chowhound.chow.com/topics/9168...). They're the worst places you'd ever want to shop.

                                                                          1. re: Jacquilynne

                                                                            Well then I wonder why in Australia, where liquor, wine & beer is privatized, you have a combination of really nice looking stores all the way down to bottle shops attached to bars? Surely that range of retailers could happen here if alcohol sales were privatized, no?

                                                                            1. re: Flexitarian

                                                                              Same situation in most European countries, of course.

                                                                              1. re: Flexitarian

                                                                                Agreed. Private Bottle Shops in Australia such as Dan Murphy's and Nicks Wine Merchants are as nice looking and stocked as the best LCBO stores. Just because stores in Alberta look like crap (according to some posters here), it doesn't mean it'll be so in Toronto.

                                                                            2. Too depressing. I'm going fishing tomorrow. Bye.

                                                                              4 Replies
                                                                              1. re: DockPotato

                                                                                Ha ha,

                                                                                Common DP !

                                                                                A value fight is a worthy fight !

                                                                                BTW I'm harvesting all my hot red peppers and making screaming hot sauce tomorrow. Secret family recipe...

                                                                                Do you trade fish for hot sauce ? I have the wine to sip during negotiations !

                                                                                1. re: PoppiYYZ

                                                                                  You still owe me some hard cider from the Ferri's tip last season...

                                                                                  At least apples won't be extortionately-priced this fall!

                                                                                  My serranos rocked this year, tomatillos, too.

                                                                                  Had enough LCBO wrestlin' for the season.

                                                                                  1. re: PoppiYYZ

                                                                                    Those are all subjects for new threads. Why doesn't this site allow U2U's? It's not as if it's poor.

                                                                                    1. re: DockPotato

                                                                                      Woo Hoo !

                                                                                      Cider (still got some of last years), fresh DP fish, and hot sauce ! Sounds like a great meet.

                                                                                      PS I'll bring the PO to show you too.

                                                                                      PPS Never give up on a good fight, that's what they want us to do....


                                                                                2. As much as everyone wants this to happen, I am of the opinion that it shouldn't...because it won't improve things.

                                                                                  Look at the grocery store industry. Entirely private and all you get are the big names brands at every location. Very few if any local products and the barriers to entry are huge.

                                                                                  While I am not saying the LCBO is better in terms of variety (though it likely is in the long term), atleast all the profits at the LCBO go to the province and reduce some tax burdens.

                                                                                  Moreover, if Alberta, New York and BC are any indicator, you'll get an alcohol aisle in the grocery store and a beer selection in the corner stores. The beautiful LCBO stores we enjoy now with the good environment and customer service will be gone.

                                                                                  10 Replies
                                                                                  1. re: meatnveg

                                                                                    Indeed that 'can' happen - but only if people are interested in buying that way.
                                                                                    What 'will' happen is a greater selection of wines (? and spirits). I can't find my notes right now, but I recall that Alberta wine 'listings' are about triple those in Ontario. Of course, that will be mainly available in the larger centres, so not perfect - but that's where the specialty grocery stores are also.

                                                                                    1. re: estufarian

                                                                                      Honestly, Estufarian - from what I've seen, it turns in to a debacle. Having spent significant amounts of time in both BC and Alberta, I easily prefer the LCBO. It's hands and feet over what they have - but I totally agree with something needs to be done about importation. Being as resourceful as you are, I imagine you've already tried going through a broker that's licensed to import wine? And what about online auctions? I know our mutual acquaintance Matt does his fair share of them.

                                                                                      1. re: justxpete

                                                                                        The trouble with on-line auctions is the provenance. One needs to have an 'honest broker' between the seller and buyer.
                                                                                        I used to buy regularly at auction (9-11 and its aftermath put paid to that - IIRC I stopped in 2004), and learned which auction houses to trust.
                                                                                        I tried a few on-line auctions with not much luck (in terms of quality of wine), and the only legal 'regular' auction in Canada (for Ontarians) is the LCBO auction in October. I haven't bid in the LCBO on-line auctions because of the onerous conditions (e.g. if the wine is misdescribed as to description or quantity - "tough luck"). I have bid in the October auction and prices there are about 20 % higher than 'world-wide' auctions. Plus the 'double-dipping' on taxes (HST or its predecessors is charged on both the original purchase and the re-sale - without any credit for the input taxes).
                                                                                        But my big issue with the LCBO (AGCO) is the inability to IMPORT wine bought at out-of-country auctions. The rules require the LCBO to acquire the wine - clearly impossible to do.(NOTE: For completeness it is possible to bring the wine in as 'accompanied' luggage if one collects it oneself - and pays the appropriate levies and fees).

                                                                                        1. re: justxpete

                                                                                          There was a big discussion on this many years ago on the Wine Spectator forum. LCBO's primary role isn't retail but rather regulation as defined in the LCA. The importation you talk about is in the regulations and won't be changed unless they relax other rules all of which impacts all alcohol sales in Ontario, including consignment and auction purchases. This is what I said above that privatization without deregulation would be unsubstantive.

                                                                                          And preferring LCBO to BC and Alberta isn't saying much. It's like saying who's the tallest midget. I collect wine as a hobby and my dream is privatization with deregulation and we end up free to buy wine from anywhere in the world (with payment of reasonable duties) like they can in New York, Hong Kong or Melbourne.

                                                                                        2. re: estufarian

                                                                                          A lot of people were throwing around that stat from Alberta when it first came out without telling the whole story. The number of SKUs in the system went up to almost triple what it was before privatization (not triple Ontario, it's more like 1.5 times the comparable SKU counts maintained by the LCBO).

                                                                                          The number of SKUs stocked by shops on average went down by almost 1/2

                                                                                          What this means is two things 1) there are a small number of relatively large stores that stock a broad selection but most places have only big selling plonk 2) there are a lot of things "listed" in the system that you can't actually get because they are sold out or on allocation from the winery etc.

                                                                                          A little anecdote, a friend was in town from Calgary and I served him a California Cab that's a vintages essential, in other words a wine I can walk into my local store and buy 355 days a year. He liked it so much that I lifted the label for him and he took it to his "good" wine store in Calgary to see if he could get some and the owner laughed, last year he got 1/2 a case and they were all spoken for before they even got to the store.

                                                                                          1. re: bytepusher

                                                                                            The LCBO's buying power is certainly an advantage, but the time and effort it takes to get a product listed is burdensome, if not impossible for some products.

                                                                                            1. re: hal2010

                                                                                              I agree with that 100%. But the solution is not privatization, when this can be resolved by amending the import and listing procedures.
                                                                                              Both of those are as onerous as they are to protect Canadian wineries, breweries with a fair bit of lobbying by the big guys.

                                                                                              1. re: meatnveg

                                                                                                The industry 'in general' is supported through lower mark-ups. However, getting listings is NOT easy for Canadian wineries (in Ontario).

                                                                                          2. re: estufarian

                                                                                            Seems to me that the best solution is push Queens Park to remove the import restrictions and improve the listing process.

                                                                                            This maintains the LCBO profits and gives us more choice.