the ontario beer market - ambq · • independent and family fun beer import agency based in...
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THE ONTARIO BEER MARKET BY: TOMAS MORANA (NOV.21st, 2016)
KEEP6 IMPORTS • FOUNDED IN 2005 BY RALPH MORANA.
• INDEPENDENT AND FAMILY FUN BEER IMPORT AGENCY BASED IN TORONTO.
• OWNERS OF BAR VOLO, BIRRERIA VOLO AND CASK DAYS.
• THE GOAL WAS TO BRING NEW AND EXCITING PRODUCTS INTO THE ONTARIO MARKET.
• DEVELOPED A STRONG UNDERSTANDING OF LIQUOR LAWS AND REGULATIONS. • OVER 100 POINT OF SALES ACROSS ONTARIO W. A STRONG FOCUS ON LICENSEES.
• WE LOOK FOR BREWERIES THAT ARE DISTINCTIVE, SENSE OF REGIONALITY, BREWING TRADITION AND INNOVATION.
• PRESENTLY WORKING WITH APPROX. 20 SMALL BREWERIES FROM: CANADA, US, ITALY, GERMANY, BELGIUM, FRANCE & SWITZERLAND.20 YEARS OF EXPERIENCE IN THE RESTAURANT AND HOSPITALITY INDUSTRY
ONTARIO LIQUOR SYSTEM
KEEP6 IMPORTS • CROWN CORPORATION - The Liquor Control Board of Ontario (LCBO)
• Founded in 1927 to control the sale, transportation and delivery of alcohol.
• Government QUASI monopoly - only retailer that can sell alcohol.
• Local producers can sell products through their own retail stores. • All out-of-province produced ALCOHOL IS considered “imported”.
• Imported ALCOHOL PRODUCERS REQUIRE AGENT REPRESENTATION IN ONTARIO. • NO PRIVATE OR INDEPENDENT RETAIL STORES.
• BARS AND RESTAURANTS BUY MAJORITY OF ALCOHOL FROM LCBO DIRECTLY.
• LICENSING AND LAWS ARE REGULATED BY AGCO (ALCOHOL AND GAMING COMISSION OF ONTARIO)
• SIMILAR TO: SAQ (QUEBEC), SYSTEMBOLAGET (SWEDEN), ALKO (FINLAND)
• Population of ONTARIO = 13.7 million
• Largest city: Toronto = 2.6 Million
• 191 operating breweries
• 54 contract breweries
• 100 breweries planned to open in 2017
• 651 LCBO RETAIL STORES
• 60 grocery stores
• 450 beer stores
• 113 local brewery on-site retail
QUICK FACTS
• LARGEST PURCHASER OF ALCOHOL IN THE WORLD
• 5.57 BILLION IN REVENUE SALES (2015-2016)
• 40.4% SPIRITS, 27.5% WINE, 22.4% BEER, 9.7% VINTAGES
• LCBO - 52.1% OF ONTARIO ALCOHOL SALES
• $35.62 AVERAGE TRANSACTION PER CUSTOMERS
• 22,700 PRODUCTS LISTED AT LCBO
• 86 COUNTRIES LCBO BUYS ALCOHOL FROM
• 509,970 LABORATORY TESTS
• 36% ONTARIO CRAFT BEER INCREASE (FROM 2015)
QUICK FACTS
Types of distributionFOR IMPORTED BEER
General listings
Seasonal listings
Grocery stores
PAID BOTTLE listing
Keg program
Consign-ment
Private order
E-comm.
PAID KEG LISTING
LCBO RETAIL
LCBO Specialty services
THE BEER STORE
Lcbo retail LISTINGSSEASONAL AND GENERAL
KEEP6 IMPORTS • ALL BEER IN LCBO RETAIL MUST BE SUBMITTED AND APPROVED BY CATEGORY MANAGERS.
• SEASONAL BUYING CALENDAR (SPRING, FALL, WINTER, SUMMER ETC.) • Preferred beer's are award winning and HAVE PROVEN TRACK RECORDS IN LOCAL
MARKETS. ACTIVE IN MARKET THROUGH SPECIALTIY SERVICES AND KEGS.
• IF SELECTED LCBO WILL COMMIT TO a ONE TIME PURCHASE. force pushed to approx. 75-100 stores. 500-700 CASE PURCHASE ORDERS.
• All Retail listings are subject to strict label, shipping carton, palletizing and lab requirements.
• General listings are products chosen to be available all year round.
• BEER IS DIVDED BY IMPORTS, LOCAL AND SEASONAL INSIDE RETAIL OUTLETS. SOME STORES OFFER REFRIDGERATION.
• PREFERRED FORMATS FOR GENERAL LISTINGS ARE SIX PACKS AND TALL CANS. LARGER SINGLE BOTTLE FORMAT FOR SEASONALS.
KEEP6 IMPORTS PROS • LARGE PURCHASING VOLUMES
• SAME PRICE AT ALL LCBO’S
• 75-100 FORCE LISTINGS
• REASONABLE LCBO MARK UPS
• LCBO DELIVERS PRODUCT TO STORE
• SEASONAL FEATURE IN STORE
• MICROBREWERY TAX BREAK
• BRAND AWARNESS
CONS • NO LISTING GARUNTEE
• NO RE-PURCHASE GARUNTEE
• LABEL AND PACKAGING COSTS
• NON-TEMP. CONTROL STORAGE
• NON-TEMP. CONTROLED TRANSPORT
• NO CARRIER OPTIONS
• LAB TESTING WAIT TIME
• NON-COMPLIANT CHARGES
Specialty services / e-commerce
SHIPPER LCBO AGENT SUPPLIER LICENSEE
KEEP6 IMPORTS • CONSIGNMENT AND PRIVATE ORDERING (PROGRAM FOR NON-LCBO RETAIL LISTINGS)
• PRIVATE ORDERS ARE “PRE-ORDERS” AND MUST BE PRE-SOLD BEFORE SHIPPING.
• CONSIGNMENT IS FOR AGENTS WHO HAVE QUALIFIED (W.SALES) FOR WAREHOUSE SPACE.
• AGENT AND SUPPLIER CAN DECIDE WHAT TO BRING IN (NO LISTING PROCESS).
• CUSTOMERS THROUGH SPECIALTY SERVICES ARE PRIMARILY LICENSEES. • ALL PRODUCTS ARE SUBJECT TO LAB AND LABEL TESTING.
• SHIPPING AND LABEL REQUIREMENTS ARE NOT AS STRICT AS RETAIL LISTINGS
• “E-COMMERCE” A NEW ONLINE WEB STORE FOR CONSIGNMENT PRODUCTS.
• AGENTS ARE RESTRICTED TO THEIR ORDERING AND STORSGE THRESHOLDS.
• PROGRAM IS PRIMARILY WINE AGENCIES. VERY LITTLE BEER AND SPIRITS.
KEEP6 IMPORTS PROS • NO PRODUCT SCREENING
• SHIP PRODUCT AS IS • REASONABLE LCBO MARK UPS
• DIRECT DELIVERY TO CUSTOMER
• FREE BUYING POWER
• WEB BASED ORDERING SYSTEM
• E-COMMERCE (LCBO ONLINE)
• PAYMENT TERMS
CONS • ORDERING LIMITATIONS • NON-TEMP. CONTROL STORAGE / TRANSPORT
• CASE MINIMUM ORDER
• NO CARRIER OPTIONS
• LAB TESTING WAIT TIME • LAB AND LABEL FEE’S
• NO CO-LOADING/CONSOLIDATION
• NO OFF-SITE WAREHOUSE
Keg program
AGENT SHIPPER LCBO SUPPLIER LICENSEE
KEG DISTRIBU-
TOR
KEEP6 IMPORTS • LCBO DOES NOT HANDLE OR WAREHOUSE KEG ORDERS.
• ALL OUT OF PROVINCE KEGS ARE HANDLED BY FIVE APPOINTED LCBO KEG DISTRIBUTORS. • KEG DISTRIBUTORS ARE BOUND TO AN EXCLUIVE AGREEMENT WITH THE LCBO.
• AGENTS OR IMPORTERS CANNOT APPLY TO BE A KEG DISTRIBUTOR.
• TRANSPORTATION RESTRICTIONS AND ORDER MINIMUMS. NO CO-LOADING.
• FIVE TIER DISTRIBUTION SYSTEM: SUPPLIER, LCBO, AGENT, KEG DISTRIBUTOR AND BAR
• BEER STORE KEG LISTING FEE.
• KEG MARKET IN ONTARIO IS CHALLENGING (DEALS, KICK BACKS, BUY OUTS ETC.).
• IMPORT KEG PRICING IS EXPENSIVE, NOT APPEALING TO MANY BARS AND RESTAURANTS.
KEEP6 IMPORTS PROS • TEMP. CONTROLLED STORAGE
• BY-PASS LCBO WAREHOUSING • LIMITED RISTRICTIONS TO # OF SKUS
• ONE WAY KEGS
• GROWING KEG MARKET
• KEG EMPTY RETURNS
• FRESHNESS
• NO LAB TESTING
CONS • PRODUCT IS IN HANDS OF COMPETITOR • NO-CO LOADING, HIGH TRANSPORT COSTS
• MINIMUM ORDERS – 96 KEGS
• NO CARRIER OPTIONS
• KEG DISTRIBUTOR CONTRACTS • LIABILITY INSURANCE
• FAULTY KEG RETURN PROCESS
• PRICING OF KEGS, DISTRIBUTOR MARK UP
Beer culture in Ontario
KEEP6 IMPOR
• Growth Of Craft Beer
• Craft Beer Culture
• Bar and RESTAURANTS
• Brewpubs and Breweries
• Festivals and eventS
• Where the market is going
• ONTARIO V.S Québec
THANK YOU !