Each province has its own liquor board established by their governments,
with their own set of rules and regulations which Highwood Distillers much operate within.
Canadian Liquor Boards are independent monopolies, controlled by their provincial governments. Each jurisdiction operates its own business, although they must follow federal rules for product and packaging standards. These Canadian standards relating to Food and Drug regulations, along with packaging requirements for labels and cartons, print and font size and package size etc., are published and available from any of the liquor board web sites. All brands must have UPC and SCC international product codes for distribution in Canada.
LIQUOR BOARD POLICIES & PRACTICES
Pricing - Each Liquor board has "reference" or "floor" pricing standards, which set the minimum retail price points for each product category. All boards encourage premium pricing to enhance profit.
Taxation - All products are subject to excise tax, environmental taxes or levies, plus federal and provincial taxes. Liquor boards work with international freight forwarders and arrange delivery from point of production or nearest port.
Board Mark-ups - FOB or ex-works prices are subject to liquor board mark-ups that are added on top of freight and other costs. These mark-ups can exceed 100 per cent of product cost and freight, depending on beverage type and country of origin.
Board Distribution Systems - Each liquor board has its own retail store and distribution system, staffed by union employees (the province of Alberta is privatized). Licensed bars, restaurants and hotels etc., must buy their products through the liquor board outlets, many of which have "licensee depots" to handle this channel. There is a slight discount in cost in most provinces, which is available to all outlets equally. It is illegal to offer on-premise accounts incentives or inducements to buy specific products. Licensees may however, use branded items such as glasses, POS material, and other items to promote specific brands.
Sales Quotas - Liquor board purchasing groups have strict sales quotas for all brands listed. Brands not achieving quota are discounted at the supplier's cost and sold out. Individual stores have the power to list or de-list brands, dependent on volume, compared to other brands in a given category. If products are performing well and growing in sales volume, they will be retained. New brands are provided with initial distribution into approximately 20 per cent of the retail stores, usually the largest in the province, but there is no guarantee that they will remain in these stores after six months of sales. It is up to the agent's sales force to grow distribution and to establish shelf space in other retail outlets on a store-by-store basis.
Board advertising & merchandising programs - Suppliers are encouraged to participate in liquor board advertising and merchandising activities, as well as other promotional programs such as consumer advertising, in-store tastings and on-premise activities. These proposed brand investment costs are reviewed before brands are considered for listing. All actual promotion spend is continually reviewed.
Marketing plans - A full marketing plan must be submitted as part of the initial application process, which must be made through a licensed agent, working in the province and representing the producer. Many liquor boards offer "calls" for various product groups, and review products, packaging, promotional spend, and actual sales in other regions in their review of potential products for their boards. Liquor boards will not review unsolicited products which are not represented by a qualified agent. It can take up to one year to launch a new product into the retail system.
Listing types - Most liquor boards have two distinct departments: General List (products which must comply with Canadian standards and quotas); and Vintages or Specialty (international products, of unique types and price points, not required to change packaging to meet standards; these are usually reviewed, selected for listing, and purchased on a one-time basis).
Payment terms - New products purchased by the liquor boards usually have 90-day payment terms. Once listed and carried on a regular basis, the government liquor boards pay suppliers in 30 days after receipt of goods. Note that the provinces of Alberta and British Columbia sell products on a consignment basis, therefore suppliers are not paid until the product is sold.
Canadian Business - There are approximately 3,200 retail outlets in Canada, more than 30,000 on-premise accounts, and 35 Duty Free outlets at border cities and airports. Liquor boards are targeting $8 billion in retail sales and will turn over more than $2.5 billion in profits to their provincial governments.
PROVINCIAL LIQUOR BOARDS
British Columbia Liquor Distribution Branch (LDB)
In British Columbia, the Liquor Distribution Branch (LDB), under the authority of the Liquor Distribution Act, has the sole right to purchase beverage alcohol, both in and out of the province. It is responsible for the importation, distribution, wholesaling and retailing of beverage alcohol, and operates government liquor stores and distribution centres in the province. Another branch within the Ministry of Public Safety and Solicitor General, the Liquor Control and Licensing Branch (LCLB), enforces the Liquor Control and Licensing Act. The LCLB is responsible for the licensing, monitoring and enforcement of the Act and regulations related to private liquor stores, restaurants, pubs and manufacturers.
The LDB operates a province-wide beverage alcohol retail and wholesale business within a mixed public-private model. It now operates 197 government liquor stores, two distribution centres, in Vancouver and Kamloops; and a head office facility in Vancouver. B.C.’s beverage alcohol retail model includes government liquor stores, licensee retail stores, rural agency stores, British Columbia manufacturer stores, independent wine stores and duty-free stores, for a total of 1,390 liquor retail outlets.
Visit their web site: www.bcliquorstores.com
Alberta Gaming and Liquor Commission (AGLC)
The Alberta government privatized liquor retailing in September 1993. The private sector retails, warehouses and distributes liquor in Alberta. The Government of Alberta, through the Alberta Gaming and Liquor Commission (AGLC), continues to regulate the industry, issue liquor licences, and collect revenues from the sale of liquor. Almost 80 per cent of Albertans are satisfied with the conduct of Alberta's liquor business.
There are more than 1000 retail liquor outlets in the province. Manufacturers ship their products to privately operated warehouses approved by the AGLC. Liquor licensees order their stock directly from these warehouses.
Alberta's population exceeds 3,000,000.
Visit their web site: www.aglc.gov.ab.ca
Saskatchewan Liquor and Gaming Authority (SLGA)
The Saskatchewan Liquor and Gaming Authority (SLGA) is a Treasury Board Crown Corporation responsible for the distribution, control and regulation of liquor and gaming across the province. SLGA also has more than 190 franchise outlets throughout the province.
There are more than 700 liquor outlets in more than 400 communities across the province. SLGA operates 79 liquor stores in 64 communities across. In addition, SLGA has granted 188 small businesses in Saskatchewan a franchise to sell beverage alcohol on its behalf. There are also 453 permitted hotels and brew pubs in Saskatchewan that can sell beverage alcohol for off-site consumption.
Saskatchewan's population exceeds 1,000,000.
Visit their web site: www.slga.gov.sk.ca
Manitoba Liquor Control Commission (MLCC)
The mission of the MLCC is to promote the safe, healthy and responsible use of beverage alcohol products, thereby generating revenues for the Province. There are 176 agency liquor outlets, 50 MLCC-controlled outlets, and four duty free outlets.
Manitoba's population exceeds 1,200,000.
Visit their web site: www.mlcc.mb.ca
Liquor Control Board of Ontario (LCBO)
The LCBO is the largest single purchaser of beverage alcohol in the world, purchasing fine wine, spirits and beer from more than 60 countries for Ontario consumers and licensees. Through its integrated distribution and retail network, over 6,500 quality products are available in more than 600 LCBO retail stores across the province.
Ontario's population exceeds 12,000,000
Visit their web site: www.lcbo.com
Société des alcools du Québec (SAQ)
The SAQ is a government corporation that sells alcoholic beverages throughout the province of Quebec. A growing company, it currently employs nearly 6,000 persons and manages more than 800 points of sale including its network of 403 outlet and six depots. Annual gross sales exceed $2.5 billion, some $1,5 billion of which comes from the stores of its outlet network.
The SAQ also operates large warehouses with a combined capacity of 4.3 million cases and a fleet of 230 transport and delivery vehicles. It supplies 22,800 holders of alcoholic beverage sales licenses (hotels, restaurants, bars, etc.) and 277 food wholesalers who, in turn, serve the needs of 8,400 grocers. In 2004-2005, the SAQ sold 7,633 products from more than 2,400 producers in some 45 countries.
Quebec's population exceeds 7,400,000.
Visit their web site: www.saq.com
New Brunswick Liquor Commission (ANBL)
Alcool NB Liquor is a Provincial Crown Corporation responsible for the purchase, importation, distribution, and retailing of all beverage alcohol in the Province of New Brunswick. There are 51 Board operated liquor outlets, 71 Agency outlets, 11 Cottage Wineries, Manufacturer's Agencies and Micro-Breweries, and three Duty Free/Land outlets in the province.
New Brunswick's population exceeds 750,000.
Visit their web site: www.nbliquor.com
Prince Edward Island
P.E.I. is joined to New Brunswick by the world's longest bridge. It can also be reached by ferry from Nova Scotia. There are 19 Board-controlled liquor outlets and one Agency outlet.
P.E.I.'s permanent resident population exceeds 140,000, with a much larger population during peak tourism months.
Visit their web site: www.peilcc.ca
Nova Scotia Liquor Corporation (NSLC)
The NSLC, a provincial Crown Corporation, is Canada's fourth largest retailer of beverage alcohol, offers almost 3,000 beer, wine and spirit products through 108 retail stores, 23 Agency stores and four Private Wine and Specialty stores.
Nova Scotia's population exceeds 1,000,000.
Visit their web site: www.nsliquor.ca
Newfoundland Liquor Corporation (NLC)
Canada's most easterly province, Newfoundland is an island off the coast of Nova Scotia, accessible by boat or air.
Newfoundland's population exceeds 530,000.
Visit their web site: www.nfliquor.com
Yukon Liquor Corporation
The Yukon Liquor Corporation controls the purchase and sale of all beverage alcohol products to balance the need: to maintain the health and safety of Yukoners; to provide alcohol products to those who desire it; and to provide a reliable source of revenue for the Yukon Government. There are six retail stores in the Yukon.
The Yukon Territory's population exceeds 30,000.
Visit their web site: www.ylc.yk.ca
NWT Liquor Commission
The NWT Liquor Commission does not have a web site, however you can browse the Northwest Territories' government web site here.
The Northwest Territories' population exceeds 40,000.
Visit their web site: www.gov.nt.ca
Nunavut Liquor Commission
The Nunavut Liquor Commission does not have a web site, however you can browse the Government of Nunavut web site here.
Nunavut Territory's population exceeds 28,000.
Visit their web site: www.gov.nu.ca