Province backing off on Sunday openings
It may be great for the tourism industry, but local beer and wine store owners say Sunday opening is bad for business
For the first time since Oct. 1 – the day that the B.C. Liquor Distribution Branch first opened the doors of its Whistler stores on a Sunday – Bonnie Casavant is feeling optimistic.
Under pressure from the B.C. and Yukon Hotel Association, which appealed to the business sense and fairness of Small Business, Tourism and Culture Minister Gerard Janssen, the Liquor Distribution Branch has agreed to once again close the MarketPlace liquor store on Sundays, effective Dec. 16. By Dec. 17, Casavant said that Sunday revenues at her store were back to normal.
Casavant estimates that her Blackcomb Cold Beer and Wine store lost about $14,000, or slightly less than 50 per cent of revenues, since the provincial government gave the go-ahead to open Whistler’s two liquor stores on Sunday.
"It had a large effect on our business, that’s for sure," says Casavant. "Even we were surprised at just how large."
To make a case against Sunday opening, she compared this year’s Sunday sales to last year’s, and used the receipts from Chef Bernard’s café next door (which she runs with her husband, Bernard) as a control. If business was down in both establishments, for example, it might indicate that it was a slow business day.
On the first day that the liquor stores in Village Square and the MarketPlace were open, business at the Blackcomb Beer and Wine Store was down almost 30 per cent, while business at the café was down 12 per cent. The following Sunday, revenues at the beer and wine store were down 51 per cent while business at the café was up 18 per cent. One Sunday (Oct. 29), beer and wine store business was down an incredible 77 per cent compared to the same Sunday a year earlier, while business at the café was up 109 per cent.
Since Sunday sales account for approximately 30 per cent of her beer and wine store’s weekly sales, Casavant says there was a chance that the store might have been forced out of business. She even considered taking legal action against the Liquor Distribution Branch at one point, but held off in on the assurance that the government was looking into the matter.
Section 9a of the Surich report – an independent review of provincial liquor regulations with recommendations for modernizing the industry – stated that the opening of government stores on Sundays, while positive, should be done in such a way as to ensure minimal impact on existing liquor retailers. This was a minimum condition for Sunday opening that Whistler’s beer and wine stores say that the government overlooked when it gave its approval.
"As you can see by the figures, the impact was considerable," says Casavant. "We’ve always said that they should have the one (liquor store) in the village open. That makes more sense if they’re trying to hit the tourists. That’s where all the walk-by traffic is anyway."
Casavant says she became frustrated early in the process once it became clear that Whistler was going to be a test site for more Sunday openings across the province, no matter what. Although beer and wine store owners were told that the government wouldn’t take any action until independent liquor retailers were consulted, she felt the government never took the consultation process seriously.
"One of the things they had to do was talk to all the cold beer and wine store owners, and three people showed up and had a meeting with each of us. They just sat down and said ‘we’re opening Sunday’s’ and that was that. Any concerns we had, they didn’t want to deal with at all. They just sat down with us because it was their mandate to do so – they felt there was enough business to go around for everybody."
Ben Horne, the owner and operator of The Boot Cold Beer and Wine store, told Casavant that his losses were on par with hers. Although Ron Hosner’s beer and wine store in Creekside is more isolated from the village liquor stores, he also says his Sunday revenues are down.
According to Dick Gibbons, the chair of the liquor committee for the B.C. and Yukon Hotels Association and the owner and operator of the Longhorn and Buffalo Bills in Whistler, the original plan called for one provincial liquor store to open, not both.
"We understood that there would be a store opening in Whistler and that the one that made the most sense was the one in the village," says Gibbons. Opening both stores was not part of the original deal.
When it became clear that Sunday opening at both liquor stores was having a major impact on Whistler beer and wine stores, the B.C. and Yukon Hotel association paid a visit to the minister of small business.
"I think Gerard Janssen recognized immediately that what had occurred was not in keeping with what was agreed to, and did the honourable thing. The municipality was concerned as well, and the fact that they also expressed their concern to the province also helped a lot," said Gibbons.
According to municipal planner Mike Kirkegaard, municipal support for Sunday opening was conditional upon "specific measures being investigated and implemented to offset negative impacts on existing cold beer and wine stores." Not only did the LDB fail to do that, it also interpreted a letter expressing the municipality’s concerns as a vote of support for Sunday openings.
"They were only supposed to open stores once they determined it would have minimal impact on existing cold beer and wine stores in the private sector," says Gibbons. The only concession that beer and wine stores were given was the ability to sell fortified wines, such as Sherry and Port, which represent less that 0.03 per cent of Casavant’s total sales.
The original agreement between the B.C. government and beer and wine store owners that allowed private liquor sales came about in the 1980s when the government decided against opening provincial stores on Sundays. First of all, they didn’t think the union would go for it. Secondly, they didn’t believe it would be profitable.
"Hotels and pubs throughout B.C. had an opportunity to open these cold beer and wine stores with the understanding that they would have the exclusive rights to Sunday opening, and make their money by being open when the government liquor stores were closed – holidays, Sundays, evenings," says Gibbons.
Within a short period of time more than 300 private cold beer and wine stores were open around the province, and until the government released the Surich report in March of 1999, most of these businesses operated with a comfortable margin.
"We got a small profit margin for opening these stores, after paying taxes and buying our inventory from the government at a discount, but it was economical to do it, so we took on the task," says Gibbons.
Once the report was released, however, things began to change for the worse.
"First, they said ‘we want to start taking credit cards in the stores, and that obviously had a huge impact on cold beer and wine stores… we agreed to that and understood that it was something that we really couldn’t stand in the way of, but it hurt our business.
"Then they said they wanted to open a handful of liquor stores on Sundays in high tourist traffic areas, but only after consultation with the private sector to ensure that there would be minimal impact."
The government has already given the go ahead to open three stores in the Vancouver area on Sundays and holidays, and up to four more openings are planned. Gibbons says the hotel association is concerned about a few of these locations, and feels sure after the Whistler experience they will be successful in keeping problem stores closed.
"At any level, if you’re talking about the original agreement (beer and wine store owners) had with the government, it was contrary to what was understood in the original agreement," Gibbons said.
"If you’re talking about what was discussed in the Surich review, it was contrary to what was understood in the Surich review.
"If you’re just talking about business ethics it’s contrary to what most of us would consider proper ethics. Say there was GM dealership that was selling their cars for 15 years, and then GM decides to open their own dealership right next door – it wouldn’t be considered ethical. That’s what this is all about."
Even with one provincial liquor store open, Casavant says she will be watching her figures closely. If they remain lower than average, she says she will ask the LDB to help beer and wine stores by lowering their markup on alcohol and by allowing beer and wine stores to sell spirits at competitive prices.
