Premier Horgan confirms B.C. restaurants may be able to buy alcohol at wholesale prices

Restaurant owners have been wanting to be able to buy alcohol at less than full retail price for years

john horgan june 10
B.C. premier John Horgan recently addressing media | B.C. government

The B.C. government will consider a proposal for restaurant owners to be able to buy alcohol at wholesale prices, much like private and government liquor store owners are able to do, B.C. Premier John Horgan said June 10.

"Yes, we are still looking at it," Horgan said. "[Attorney General David] Eby has it on his agenda. It hasn’t yet come to cabinet so no decision has been made, but I absolutely understand the challenges that the industry is facing, and we want to do everything we can to get outside of the box, outside of the traditional obstacles that some in hospitality have highlighted for us."

The restaurant industry has been calling on this move for years as a way to lower the prices of alcohol in restaurants and to encourage people to dine out. BC Restaurant and Food Services Association CEO Ian Tostenson told Business in Vancouver May 13 that he believed the industry was "on the cusp" of getting the change approved.

Days into the COVID-19 pandemic, the government changed regulations to allow restaurant owners to deliver alcohol to customers, but restaurant owners have told BIV that few customers do that because it is cheaper to buy wine at the liquor store.

Restaurant owners have also felt aggrieved that the province went ahead with a 5.4% minimum wage hike, to $14.60 per hour in most job categories, on June 1.  White Spot owner Ron Toigo told BIV in March that postponing that minimum wage hike was "the minimum they should do."

The consensus tends to be that getting a discount on alcohol purchases would help compensate for the hit of a higher minimum wage.

Glowbal Group owner Emad Yacoub told BIV that he has laid off about 650 of his 850 staff. Buying alcohol at a wholesale prices would enable him to bring back at least 50 workers, he estimated, basing that on a 25% discount on $200,000 spent on alcohol per month for his nine restaurants.

It is unclear exactly what wholesale discount the government would provide restaurants. Former Premier Christy Clark's administration scrapped the system where there were a set of different wholesale discounts on a pre-determined retail price. Instead, former Attorney General Suzanne Anton was in charge of creating a system that would work up to a wholesale price. Private and government stores could then provide their own mark-up to create their own retail price.

Most in the industry expect that if restaurants were able to buy alcohol at the same wholesale price as liquor stores, that the saving would be about 20%.

gkorstrom@biv.com

@GlenKorstrom