Miles Prodan
The province’s big picture support for the sale of BC wine – and the BC industry’s successes – has been highlighted following recent announcements in Ontario.
Last Christmas the Ontario government, to great fanfare, announced a “new” $75 million provincial Wine and Grape Strategy. This came on the heels of an announcement earlier that fall of the establishment of the Liquor Control Board of Ontario’s new Our Wine Country destination boutiques, to be located inside selected full-sized LCBO stores across the province, and to offer an expanded selection of Ontario’s exceptional VQA wines. These announcements have made for some substantial government support for the Ontario wine industry.
Like with many government announcements, not all was as it seems. It turns out that while it is good news for the Ontario VQA wine industry, the $75 million is more specifically $15 million a year over five years. Also, it isn’t new, but a well anticipated – and hoped for – renewal of a program launched in 2009, when the Ontario industry tore itself apart along small and large winery lines. The resulting levy placed on Ontario wineries (not new government revenue) funded the 2009 Wine and Grape Strategy and further drove a wedge in the Ontario industry.
The flurry of recent Ontario government announcements has inevitably led to the question of how does Ontario VQA government support compare to government support of BC VQA?
To give the question context, a reality check is helpful to understand the level of commitment and capital required to get into the Canadian wine business to begin with – and regardless of the province where you may choose to start a winery.
In his first public address in over 30 years at a recent Vancouver Board of Trade luncheon, guest speaker, serial entrepreneur and Mission Hill Family Estate proprietor Anthony von Mandl confirmed to the audience that constructing even a modest-sized family winery can require an investment of roughly $7 to 10 million and it can take three to five years of production before significant cash flow is generated in return, assuming one can overcome the biggest challenge facing most small Canadian wineries: A lack of retailing options.
Currently the government-owned liquor sales and distribution channels like the LCBO (and BC’s Liquor Distribution Board) require allocation, brand support, quality and pricing requirements many small wineries – and especially those just starting out – simply lack the production and the capital to be able to meet. In Ontario, the only retail alternative to the LCBO for small VQA producers is to sell directly from the cellar door. However, this relies on a strategic investment in tourism marketing to drive consumers to the tasting rooms, which thankfully is the focus of Ontario’s Strategy.
Fortunately, Ontario’s renewed Wine and Grape Strategy seems like a sincere attempt to finally provide that province’s VQA wines new and improved retail channels, specifically those mentioned in the Strategy: farmers’ markets and the LCBO’s new Our Wine Country destination boutiques, somewhat akin to BC’s own VQA wine stores.
Fortunately for the wine industry in British Columbia, we recognized long ago that in order for consumers to embrace, support and, most importantly, buy BC VQA wine there needed to be ready and easy access. Consequently, some time ago, the provincial government introduced private liquor stores to provide consumers access to BC wine outside the government liquor stores.
The BC government has consistently approached the BC wine industry with a holistic and long-term view rather than implementing one-off programs that are renewed at the government’s discretion and with the political climate of the day.
It is obvious that BC’s collaborative and singular wine industry voice is heard by government as it develops policies and regulations. One need look no further for an example than Parliamentary Secretary John Yap’s recently announced Liquor Policy Review recommendations that included direct benefits to the BC wine industry, such as farmers’ market wine sales, grocery store in-aisle BC VQA, among many others.
Support from the provincial government has helped the BC wine industry become the more than $2 billion-a-year economic generator it is today. Not to mention, the 10,000 jobs created in BC as a result of the wine and grape industry.
In the end, renewal of Ontario’s Wine and Grape Strategy will be good for Ontario VQA wines but falls short in comparison to the market access and government policy we enjoy here in BC.