Convenience stores

Ontario convenience stores are pushing Premier Doug Ford to derail his beer promise

The Circle K store on Parliament Street in the Cabbagetown neighborhood of Toronto on May 21, 2020.Fred Lum/The Globe and Mail

Convenience stores are calling on Ontario Premier Doug Ford to keep his promise to allow them to sell beer, a promise that was derailed three years ago after talks with multinational brewing companies broke down in the origin of the provincial Beer Store chain.

Mr. Ford’s promise to allow the sale of beer and wine in convenience stores, never mentioned during his recent re-election campaign, was a focal point when he was first elected in 2018 and a frequent topic of discussion during a large part of his first year in office.

But it was quickly dropped after the government was warned the move could cost it $1 billion in penalties for reneging on the 10-year deal the Beer Store signed in 2015 with the previous Liberal government that allowed grocery store sales but otherwise kept the chain going. partial retail monopoly.

Now, with the Progressive Conservative government in place with a bigger majority for the next four years, the convenience industry is eyeing an expiration date for that deal in 2025, which could end the Beer Store’s dominance. In order to change the deal or cancel it, the government must give notice by autumn 2023 – meaning new rules for beer sales are now under discussion.

Some in the convenience store sector are even hoping that at least the beer could be on their shelves within a year, perhaps before the Beer Store Agreement expires, as has long been the case in Quebec and in neighboring New York State.

Kenny Shim, chairman of the board of the Ontario Convenience Stores Association and president of the Ontario Korean Businessmen’s Association, which represents 900 member convenience stores, said he spoke with Mr. Ford about two weeks before the election and that the Prime Minister had assured him of the right to sell the beer was coming.

“Usually they tend to listen to you more a bit before the election,” said Mr. Shim, who runs convenience store Busy Bee on King Street West in Toronto. “He was even more excited about starting with local craft beer, convenience-wise.”

In 2019, after facing that warning of billion dollar fines, Mr Ford’s government passed – but never enacted – legislation that would have torn up the Beer Store deal and attempted to cancel any obligation to offer compensation to the multinational owners of the retailer. The U.S. Chamber of Commerce warned the legislation would put a damper on doing business in Ontario.

While talks with the Beer Store fell through, the government trumpeted its decision to allow more grocery stores to sell beer under the existing deal. But later, during the pandemic, the province gave struggling restaurants and bars the right to sell alcohol to go, resulting in thousands more places to buy beer.

Emily Hogeveen, spokesperson for current Finance Minister Peter Bethlenfalvy – whose remit includes liquor rules – said in an email that the government “supports meaningful change in alcohol sales in Ontario.” She said it was “one of the government’s many priorities and we look forward to continuing to provide choice for Ontarians and new opportunities for business.”

In a statement, Ted Moroz, chairman of the Beer Store – which is mostly owned by foreign-controlled brewers Molson Coors, Labatt and Sleeman – had little to say about the future of the deal with Queen’s Park, known as the Master Framework. Agreement (MAE).

“We have nothing new to share at this time regarding the AMF’s negotiations with the government, which have understandably come to a halt during the pandemic,” he said.

Dave Bryans, executive director of the Ontario Convenience Stores Association, said allowing carry-out alcohol during the pandemic has led to the proliferation of “bottle stores” that offer token food items as a way to act as de facto like liquor stores. He also said beer sales were needed to revive his struggling industry, which faces a long-term decline in tobacco sales.

“I think if I were the Beer Store owners, I would come up with a transition and exit strategy, sooner rather than later,” Bryans said, adding that he would support a minimum requirement for craft beer sales. local.

The Convenience Industry Council of Canada (CICC), a national lobby group, commissioned an economic impact report that said allowing alcohol sales in Ontario convenience stores would create more than 7,500 new jobs in part-time and full-time and would bring in over $115. million in new tax revenue for Ontario, while increasing sales of alcoholic beverages by 3-5% per year in the province.

Anne Kothawala, president and CEO of the CICC, called the projected increase in sales modest, amounting to a few drinks per person per year.

Her group, she says, remained silent during the recent provincial election campaign, but now hopes to push the issue forward.

“We know consumers want it. The government promised it. Ontario convenience stores are ready,” she said. “And as we say, in the words of Premier Ford, let’s do it.

The industry has been anticipating change for a long time. Ian White, senior vice president of Parkland Corp., which operates gas station convenience store chain On the Run, says its retailers have already expanded their refrigeration space to accommodate future beer sales.

He also said the industry has shown it can enforce age restrictions through its track record in tobacco sales.

“We have training, we have processes in place,” Mr. White said. “We’ve been doing it for decades.”

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