Is B.C. Craft Beer at Risk of Being Squeezed Out of Market?

Victoria, B.C.– Changes in its wholesale pricing and liquor policies brought forward by the B.C. Government put small B.C. craft breweries at a disadvantage, and risk compromising the viability of this nascent industry, says Andrew Weaver, Deputy Leader of the BC Green Party and MLA for Oak Bay-Gordon Head.
The new policies make it increasingly difficult for private, often family-owned, liquor stores – the catalyst for the recent growth in local breweries – to make a profit on the sale of craft beer. This is the result of wholesale price mark-ups, the elimination of a subsidy previously offered to private liquor stores, and the Liquor Board’s policy of government liquor stores not increasing their retail prices.
Despite Minister Anton’s claims that the government was “leveling the playing field” within the liquor sector, and her assurance that prices would not increase, local producers are already being pushed out of the market.
“The recent changes to our liquor policy are making it unprofitable for private liquor stores to sell craft beer in BC.” said Andrew Weaver. “And as a consequence, it is impacting the viability of our craft beer industry.”
By jacking up the wholesale cost of BC Craft beers to small business retail outlets, they in turn must dramatically increase the price to the consumers to justify the shelf space. In doing so, they are no longer competitive with government liquor store pricing.
“The BC Liberals are putting the interests of a few large breweries and their government owned stores ahead of small business retail outlets and B.C.’s craft beer industry” notes Andrew Weaver. “There are simpler ways of adjusting the wholesale market to level the playing field imposing punitive effects on the BC Craft beer industry.”
The new wholesale pricing model introduced earlier this year eliminated the 3-tiered beer tax system, where allocation was based on production capacity, in favour of a more graduated mark-up tax that sees large and small producers pay similar tax mark-ups. The graduated mark-up could be easily tweaked to create a truly level playing field.