Challenges & Opportunities: A Bitter Draught

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Liquor legislation can be a contentious subject within the foodservice industry — so much so that Restaurants Canada launched its Raise the Bar report card on provincial liquor policies for bars and restaurants in 2015 to start a dialogue on these challenges. The reality is licensees face a number of roadblocks associated with liquor policies in place across Canada. Excise tax, interprovincial-trade barriers and a lack of wholesale pricing are among the key pain points operators identify.

“The most challenging part for us is from a purchasing perspective,” says Dan Kennedy, co-owner and operating partner at Toronto-based Amano Pasta and Union Chicken. “Not only is there no discount for buying in bulk, but in a lot of cases, we actually pay a little bit more than the public does. The average person who isn’t in the restaurant industry would probably assume that we get [our liquor] for less because of how much we buy; for that reason, when they look at sell price in restaurants, they may think they are being gouged.”

This issue is one that plagues licensees across the country, with the exception of those in Alberta, the only jurisdiction that offers true wholesale pricing for all licensees — although the P.E.I. Liquor Control Commission offers discounts to licensees and Nova Scotia offers a wholesale discount on wine and spirits.

“I would always like to see more flexibility on licensee pricing, especially now with the cost of labour going up — it naturally follows that the selling price of all of our products is going to creep up throughout the industry,” Kennedy adds. “It’s a very restricted industry, especially [given that] we’re 90 years post-prohibition,” agrees David Farran, president of both the Alberta Craft Distillers Association and Eau Claire Distillery. “We’re still living through some of the legacies of that [era].”

One such legacy is interprovincial-trade barriers — an issue that has recently received significant media attention due to a case currently in front of The Supreme Court of Canada.

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