LCBO workers and supporters picket on the line in front of the LCBO main store in Toronto, on July 5.Christopher Katsarov /The Globe and Mail
It was just a few minutes past 10 a.m. on Friday and Adin Wener, co-owner of Henderson Brewing Company, was already seeing a small crowd spill through the entrance of the bottle shop in the west end of Toronto.
Private alcohol retailers and breweries such as Henderson are bracing for a surge in foot traffic after LCBO stores across Ontario closed on Friday in the wake of the first-ever strike by their unionized workers,
“Just this morning, we had 10 to 12 more people than usual,” Mr. Wener said. “It’s going to be absolute mayhem.”
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For some in the bar and restaurant industry, still reeling from pandemic shutdowns and rising inflation, the uncertainty created by the strike is another hurdle to overcome.
Liquor Control Board of Ontario workers went on strike after talks between the Crown corporation and the Ontario Public Service Employees Union (OPSEU) broke down hours before the Friday morning deadline.
The biggest sticking point is Premier Doug Ford’s recent decision to allow alcohol sales in convenience and big-box stores starting in September, particularly ready-to-drink beverages such as coolers. Union representatives said the move threatens the livelihood of its more than 9,000 LCBO workers; the government says it is part of its long-time pledge to liberalize alcohol sales in the province and give consumers more choice.
Neither side was budging on Friday as LCBO workers hit the picket lines. LCBO stores are now set to be closed for two weeks, with a limited number to open as of July 19 on Fridays, Saturdays and Sundays for in-person shopping. Online ordering for customers and businesses is still active, and the LCBO is also allowing businesses to shop in-store at five locations starting on July 10. But licensees ordering through the wholesale website have been told by the LCBO that they can only order full cases of alcohol to their establishment – a move that could rack up costs for already struggling businesses.
John Sinopoli, executive chef and partner of Toronto’s Ascari Hospitality Group, which owns Ascari Enoteca, a catering company, and is partners in Abrielle restaurant in the Sutton Place Hotel, said he told his teams to have a least a week’s worth of extra alcohol on hand.
But he said the requirement for licensees to order a case of spirits at a time – as opposed to individual bottles – is a massive cost that many restaurants may not be able to afford.
“I would say 95 per cent of restaurants don’t order a whole case of anything on a weekly or biweekly basis, and to spend three or four months’ worth of money on alcohol we don’t need right now in this economy … is more than inconvenient I’d say,” he said.
“The whole thing is bad for business for us. It screws with our cash flow.”
Some restaurant and bar owners used the lead-up to the strike to stock up on alcohol. But industry experts still predict a significant impact on operations, where almost half of restaurants are barely breaking even or making a profit, according to Kris Barnier, vice-president for Ontario at Restaurants Canada.
“It’s one more thing that restaurants need to deal with,” Mr. Barnier said. “If the strike does carry on longer and product selection gets limited, restaurants that are very dependent on the LCBO-type products, they could be more impacted.”
Ryan Mallough, vice-president of legislative affairs in Ontario at the Canadian Federation of Independent Business, said he’s concerned particularly about smaller distilleries whose biggest customer remains the LCBO.
“To lose the LCBO as a point of sale could have a significant impact there. On the flip side, hopefully we might see this encourage more consumers to go out and go directly to those places, but I think that remains to be seen,” he said.
Other businesses, however, could see big benefits.
Wine Rack stores and Beer Stores, which are privately owned retail chains across Ontario, were also seeing more foot traffic in the middle of the day on Friday.
“A lot of our stores are getting really busy right now,” said Mark Wasserman, a spokesperson for Wine Rack. “We anticipated this and we’ve been planning.”
Mr. Wasserman said Wine Rack stores have also extended their hours by up to two hours in some of the busiest locations and increased staff to support more customers. Those shopping online will also be able to receive same-day delivery.
A statement from The Beer Store said its stores will be operating regular summer hours during the strike with some extensions on a case-by-case basis.
Troy Burtch, Senior Manager, Sales & Business Development for Great Lakes Brewery, at the brewery’s Lower Jarvis St location in Toronto on July 5.Laura Proctor/The Globe and Mail
Troy Burtch, senior manager at Great Lakes Brewery in Toronto, said that to meet demand, sales representatives who usually co-ordinate deals with the LCBO will instead focus their efforts on selling more to private chains and filling delivery orders.
Despite the surge in direct transactions, many breweries rely on the LCBO for a large chunk of their revenue and worry that more foot traffic won’t offset the financial hit to that income stream.
“We don’t think it would make up anywhere close to what we’d lose with LCBO being shut down; LCBO is our biggest retail partner for 20 years,” Mr. Burtch said.
Maggie Kiwanuka, a manager at Mascot Brewery, echoed that sentiment. Although the Toronto-area brewery sold 148 cans of beer within the first 30 minutes of being open Friday – as opposed to the usual 24 cans – she said that still doesn’t compare to its LCBO sales.
“LCBO covers all of Ontario,” she said. “We anticipate that it will have a big impact on us.”
While Mr. Wener of Henderson Brewing Company is optimistic about the surge in customers, he’s also hoping his team can accommodate demand as the strike continues.
“Breweries were not given time to make more beer,” he said.