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Eat & Drink

The Luck of the Liquor Store

Posted by Derek Flack / June 25, 2009

LCBO StrikeI'm not one with a heavy predilection for conspiracy theorizing, but when I recently came across a Vintages document related to the LCBO's Trade Day Presentation of April 15th, I heard myself make an audible "hmmmmm."

Although it was only a few days ago that I was desperately looking for alternatives to the LCBO in fear of a strike, now that it's been averted, I'm dwelling on the mind-boggling sales that took place the day before the strike might have begun. According to LCBO spokesman, Chris Layton, "it was [the] highest single selling day ever," with some reports estimating the province-wide take at upwards of 60 million dollars.

What do I find coincidental about all this? Well, a look at the document (see pp. 29, 55-6), which was made public shortly after the presentation, reveals that prior to the strike the LCBO was dealing with an overstock problem. With the "retail inventory at [an] historic high level", the purchasing frenzy brought on by the looming strike was, if nothing else, wonderfully serendipitous and convenient.

LCBO StrikeBut, as I said, I'm not a true conspiracy theorist, so I don't want to give the impression that I believe the union and employees were somehow in cahoots with the LCBO in concocting some master plan to deal with the overstock problem. As someone who's worked in a sessional and part time capacity at Ontario universities and colleges, I'm more than sympathetic to the desire of these employees to gain long-term stability and benefits, and I have zero desire to trivialize their position.

Having said that, I'm not suggesting that some brilliant but disingenuous geniuses at the LCBO prolonged strike negotiations to solve their overstock problems. The little part of me that still somehow resists cynicism and trusts government run organizations just can't quite get there.

At the end of the day, I suppose I'll chalk this one up to that strange law that seems to dictate that the rich always get richer. Monopolies like the LCBO shouldn't need luck. But it looks like that's exactly what they got, and in spades.

LCBO Strike

Discussion

23 Comments

Ntario / June 25, 2009 at 02:58 pm
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People who purchased liquor should go return it all.
Dave / June 25, 2009 at 03:00 pm
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I was thinkin the same thing, and if word got out that this potential strike was staged, well, the LCBO's reputation would be permanently damaged. Perhaps this idea requires some more digging, rather than just a blog post. This could be big.
TJ / June 25, 2009 at 03:36 pm
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As someone who works for the LCBO, there was no conspiracy. Myself along with others were wondering if we would see our office again
Greg Smith / June 25, 2009 at 03:39 pm
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After a quick reading, it would seem the document that gave rise to your suspicions refers specifically to the LCBOs Vintages product category. Were the all-time high inventories in Vintages? I recall that being the story back in April.

If so, the significance of the overstock issue (relative to overall inventory) may not have been so substantial. Also, the evidently depleted in-store inventories would seem to have been in non-Vintages SKUs. So I don't see how selling out on Russian Prince (or whatever) due to pre-strike stockpiling would help clear out their high-end wines. I know my local LCBO still has plenty of expensive wine on hand, and I don't know anyone who reacted to the prospect of a strike by snagging what they would normally view as "luxury" bottles (the kind of purchase reserved for a special occasion).

Another perspective would be that a near-strike and the excess high-priced inventory are not causally related so much as they are both symptoms of a broader strategic management deficit.
Derek replying to a comment from Greg Smith / June 25, 2009 at 04:07 pm
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That is, indeed, an excellent point. Anecdotally speaking, it seemed that the run on booze did not impact Vintages to the same degree that it did general stock. Having said that, Vintages is not, of course, all luxury bottles. There are lots of offerings less than 20 bucks (and many above too, of course). But it's for this reason that I was one of the snobs who ran to the Vintages section first! Trust me, I can't afford luxury bottles. And although much smaller, Vintages does make up a significant portion of the LCBO's market share when it comes to wine sales. So yes, the significance of the overstock issue may be overstated -- there's my booze paranoia again -- but it's not without relevance. Btw, I particularly agree with the last point!
Sean Galbraith / June 25, 2009 at 04:15 pm
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All the more reason to privatize the LCBO retain operations.
Greg Smith replying to a comment from Derek / June 25, 2009 at 04:20 pm
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Agreed, Vintages bottles aren't necessarily objectively "luxury" wines; however, at least among my friends and family, the Vintages section is about as relevant to an LCBO excursion as Harry Rosen or Birks is to shopping at the Eaton Centre. I suppose that's at least part of the problem, with the end of the freer-spending pre-recession era.

I'm stuck drinking sulphite-free wines, in any case, and it's not so easy to find those in (at least my local's) Vintages...
Greg Smith replying to a comment from Sean Galbraith / June 25, 2009 at 04:25 pm
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What reason? Paranoia? Probably not the soundest wellspring of public policy.
Jerrold / June 25, 2009 at 04:27 pm
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Many Vintages products are sold at prices BELOW general listed products. I buy wines via Vintages in the $14-20 range all the time, and pass up the $16 million-bottles-all-the-same stuff on the regular shelf.
Canchi replying to a comment from Dave / June 25, 2009 at 04:58 pm
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well, damage to LCBO's reputation? (didn't know they had something that can be damaged.)

if it's true that it was staged, I don't think the part-time employee would have anything to do with it.
Shirley replying to a comment from Greg Smith / June 25, 2009 at 05:46 pm
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Greg - I am allegic to sulphite as well... what a pain. Do you have any to recommend?

Derek / June 25, 2009 at 05:59 pm
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The paranoia comment was hyperbolic. Forgive me if that didn't come off.
Donnie MacIntyre / June 25, 2009 at 08:43 pm
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Yes and the New Coke fiasco was all a deliberately planned marketing scheme as well. Conspiracy theories be damned!
Sean / June 25, 2009 at 09:21 pm
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Bet the union heads got a 'hush up' cash envelope of a percentage of the $60 MILLION ONE DAY PROFIT! Unfortunately, the part time staff won't get anything in return. Down the road, around the next election, this may be very news worthy.
Chester Pape replying to a comment from Sean Galbraith / June 25, 2009 at 11:26 pm
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The only people who seriously think the LCBO should be privatized are libertarian whackjobs, wine "snobs" who've never travelled out of the province and don't realize how generally good it is and drunks.
Matthew replying to a comment from Chester Pape / June 26, 2009 at 05:46 am
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Ah yes, it could only be "whackjobs", drunks and snobs who would possibly want pricing in line with the value of the brands they purchase. Last time I went to Alberta I saw nothing but effete older gentlemen in smoking jackets and slovenly bearded maniacs tipping over cars and breaking windows. I tried to flee, but I stumbled over the remains of their social fabric...

Not that Alberta's pricing is so great anymore, but my point is that privatizing alcohol sales doesn't necessarily ruin a province. Instead, it offers consumers more choice in terms of brands, more locations and holiday hours.

Or maybe it should go the way of the beer store and be sold to a conglomerate of brewers? Only a couple more houses on that and they can build a hotel. Then we can all go back to arguing whether we prefer Molson Canadian or Molson Dry... I know I'm salivating already.
Jerrold replying to a comment from Chester Pape / June 26, 2009 at 07:57 am
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@ Chester Pape

You got it opposite. One of biggest drawbacks to the LCBO is that people who HAVE traveled and returned to their monopoly can't find what they want in Ontario. Selection is very limited here. And sour, flat, thin reds from Ontario are not going to be everyone's taste, no matter how much our local industry gets pampered by privileges not extended to imported products.
Kandeezie replying to a comment from TJ / June 26, 2009 at 08:47 am
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I don't think anyone would blame the employees. But the employer, on the other hand, could (like the York University strike) drag their feet in order to solve a pre-existing problem.
Ratpick / June 26, 2009 at 08:50 am
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Re: Jerrold's comment "Selection is very limited here."

THAT is right on the money and the #1 thing that the LCBO's defenders don't understand. Basically, the LCBO is the "The Bay" of liquor retailing. Lots of Yellow Tail, a few good things if you're lucky enough to live near a big one, but FAR from great. BC wines, anyone?

Oh, and they refuse to open a store in Roncesvalles because there's "not enough parking".
Chester Pape / June 26, 2009 at 09:10 am
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Two anecdotal stories, the first about pricing, a couple years ago I paid what I thought was an outrageous $25 a bottle for some NZ Sauv Blanc, then a couple weeks later I was in the UK and noticed in a wine store that the same wine was 25 POUNDS.

On Alberta, friends from Calgary visited us a couple years ago and we served a California Cab they quite liked so I lifted the label for them, it was a vintages essential, something I can walk off the street and buy at most stores 345 days a year. He went to his "good" wine store in Calgary and showed him the label, the guy laughed, then said, we got six bottles of that this year and it was already spoken for when it came in, I can put your name on the list for when I get some from the next vintage...shortly afterwards I was recounting this story to someone else who was touting the Alberta approach and his response was "oh well you don't actually go to the local stores, there are a couple big stores that run web sites, you go online and order what you want and you'll usually get it in a few days or weeks. Yah, that's convenience for you, it works out to be no different than the LCBO consignment sales goat rodeo only worse because most brick and mortar stores have garbage selection.

The idea that the LCBOs selection is weak is an urban myth, yes there is an issue, because of the way they buy you'll almost never see small production wines except for a small percentage of them that appear in some vintages contexts (mostly the classics catalogue) but you can get that stuff through consignment if you really want it. I can go into ANY LCBO store and get a decent selection of midprice product from Spain, Italy, France and California and a smattering of South American and African. Walk blind into a random wine store in NY state (closed on Sundays) and you will find more variety in what they specialize in but it won't be unusual to find local stores that have almost nothing outside big market French names, California and Oregon.
Derek / June 26, 2009 at 09:27 am
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I think LCBO selection issues are partially related to locale. If you happen to live near Queen's Quay or Scrivner Square, there's access to very good selection (in fact one that rivals stores I've purchased from in Montreal, New York, and Paris). But, and it's a huge but, if you're not near one of the bigger Vintages locations, the selection is often downright abysmal. Sure, they'll transfer between stores, but that takes a level of patience and organization that most would prefer not to have to employ on a regular basis. And, not to forget, in New York State (and others) one can readily have wine shipped to their door from the thousands of retailers who operate online outlets. Using this method one can get almost anything, which is completely different from what the LCBO's monopoly makes possible...
Johnlee / June 26, 2009 at 09:59 am
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FYI:
If you also went on the spending spree and are not totally satisfied with your purchases. You can return the UNOPEN BOTTLE to an LCBO for an exchange at face value. Even if you don't have a receipt.
Heather / June 26, 2009 at 10:56 am
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You can also return OPENED bottles, if you think they taste funny (or even if they don't! the employees have to take your word on it, as they can't taste it themselves!) even if the bottle has only a sip left (this could be because you poured it into glasses before realizing)
I have done it before, they give you a replacement bottle :)

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