Ben’s Beer Blog scores an exclusive interview with Tom Barlow, President and CEO of the Canadian Federation of Independent Grocers on the topic of liberalizing Ontario’s Prohibition-era market access rules for beer:
Some details about beer in grocery stores
- We will likely see beer on grocery store shelves in the next 18 months
- The province still hasn’t decided how to auction off licenses to sell beer in a way that is fair to small grocers
- At least one grocery store chain has stated they’d like to sell “100% craft beer.”
- If you have fears that bigger brewers are going to be able to buy shelf space, continue to be scared of that very real possibility
- Brewers will be allowed to do direct-to-store delivery
A transcript of my chat with Tom Barlow, President and CEO of CFIG, edited slightly for length
Ben Johnson: Thanks for chatting with me Tom. It’s been pretty quiet in terms of the announcement about exactly how we’re going to get beer in grocery stores. So can you tell me a little about the process for becoming eligible to sell beer in your stores? Speculation has been pretty rampant that we’d only see bigger chains getting the privilege, so it’s interesting to hear that independent grocers are at the table.
Tom Barlow: Yeah, I’ll share what I can. The regs will be coming out soon, and the people that have been in discussions are under a non-disclosure but what I can tell you is that the original conversation was that it would be just large chains, then the government through consultations with [CFIG] and regions decided that it should be open to “grocery” under the North American definition of what grocery is, namely that they carry fresh produce, fresh meat, and that kind of thing. I don’t know if they’ve settled on a size — there was some discussion that there would be a minimum size — but for all intents and purposes it would be “grocery” and it would be wide open. The discussion we’ve had so far is that there would be so many licenses to start and they’d step it out, then get comfortable, then release some more, and then release some more. The number that was floated was around 450 licenses. That is, 450 retailers are going to have the opportunity to sell beer.
BJ: I’m assuming it’s a bidding process for getting the license and that’s the part you can’t talk about?
TB: They’re still working through the mechanism, but are looking at a biding process. I think we made our point that privately held — vs. publicly held — the access to cash is different, so there needs to be a plan made so all the licenses don’t all get swallowed up by —
BJ: Galen Weston?
TB: — Yeah, exactly. We were a little frustrated at first but after numerous conversations they’ve heard our position, and I think it’s the same with the corporate chains, is that they should have just opened it up to “grocery” from the start. If you’re going to go grocery, go grocery. This contest for picking winners and losers is a slippery slope to be going down.
