Provincial liquor control boards have provided stability and a controlled environment for licenced distributors
New York, NY (PRWEB) February 08, 2015
The Beer, Wine and Spirit Wholesaling industry is beholden to provinces and territories for which there are 13 major liquor control agencies in charge of enforcing the wholesale of alcohol. These agencies were first put in place following the temperance movement that swept across much of North America in the early 20th century. “Although these alcohol agencies were implemented to facilitate the safe and legal distribution and retail sale of alcohol within each province, the system has also become an integral tool for provincial governments to collect tax revenue,” IBISWorld Economic Analyst Nick Petrillo says in the updated report. Nearly all provinces and territories have come to depend upon the licences, fees and tax revenue generated from the system as a means of funding major public projects. In this regard, provincial liquor control boards have historically provided both stability for licenced distributors as well as a controlled environment to provide the public with alcoholic beverages. Industry revenue is projected to increase over the five years to 2015.
Distributors in the industry are expected to take greater advantage of the many efficiency-maximizing technologies that are used to increase the speed of alcohol procurement, shipping and stocking. Purchases of specialized trucks help control freight temperature, while real-time inventory management systems help reduce product shrink and improve the percentage of orders that are successfully fulfilled. Major liquor distributors are incorporating these technology improvements to new, larger distribution facilities. The Liquor Control Board of Ontario (LCBO), for example, recently closed and relocated its alcohol distribution plant in Ottawa and intends to expand its liquor outlet retail to an additional 30 stores over 2015.
Provincial governments will continue generating significant tax revenue through distributor licencing and liquor retail, although barriers such as out-of-province shipping fees and bans on interprovincial beer wholesaling are projected to be gradually loosened over the next five years. “These minor reductions in wholesaling regulation will greatly benefit small-scale wineries and breweries, although doing so will slightly reduce overall demand for industry wholesalers going forward,” Petrillo says in the updated report. In the five years to 2020, industry revenue is projected to decline.
For more information, visit IBISWorld’s Beer, Wine & Spirit Wholesaling in Canada industry report page.
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IBISWorld industry Report Key Topics
This industry primarily purchases, stores, wholesales and transports alcoholic beverages including beer, wine, distilled spirits, cider, ready-to-drink alcoholic beverages, coolers, ethyl alcohol and other alcoholic beverages. This industry does not include revenue generated from the wholesale of nonalcoholic beverages.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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