The Real Reason Your Beer Costs More Than It Should

Dana Flavelle, Toronto Star:

Imagine a store where most of the products are kept in the back. You order from the cashier. The products can’t be sold below a legislated minimum price. And the overwhelming majority are made by one of three large companies, which also own the store.

In Ontario, that is how $2.5 billion worth of beer is sold each year. Surprisingly, few consumers know this is the set-up. Shoppers outside The Beer Store at Bayview and Eglinton were surprised to learn the government doesn’t own the store. Some said they’d like to see beer sold in corner stores, for convenience, and said they hope competition would lead to lower prices.

Six out of 10 people think The Beer Store is a government entity similar to the Liquor Control Board of Ontario, according an independent survey for a review of the distribution and sale of alcohol in Ontario.

In reality, the retail chain responsible for just over 80 per cent of beer sales in Ontario “is essentially a private monopoly” owned by the province’s three largest brewers, Labatt, Molson and Sleeman, the provincial study noted. The brewers, in turn, belong to some of the highest-grossing beer makers in the world: Belgium’s InBev SA, the US’s Molson Coors Brewing Co. and Japan’s Sapporo.

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