Two of the eight companies that were seeking the Liquor Distribution Branch logistics contract did not respond by the June 29 deadline.
Richmond’s GL Distribution and Vancouver’s Dimex Group were not on the list released July 3.
The six companies vying for the contract are:
- ContainerWorld Forwarding Services;
- Exel Canada;
- Hillebrand Westlink;
- Kuehne + Nagel;
- Metro Supply Chain Group; and
- Schenker of Canada.
On previous lists, Montreal-based Metro was identified as Centric Retail Logistics.
A shortlist of as many as three companies is expected to be released July 20. On April 30, liquor minister Rich Coleman told reporters in Victoria that the shortlist could be as little as one bidder. An internal LDB committee is expected to make its recommendation to the Treasury Board, of which Coleman is a member, by October and a new operator in place by March 2013.
Business in Vancouver revealed on May 8 that Exel had lobbied for the contract since 2005 and hired BC Liberal-connected lobbyists Mark Jiles and Patrick Kinsella. An Exel internal memo pondered using its relationship with Coleman to influence the writing of the RFP.
Exel also claimed close ties with the BC Government and Service Employees’ Union. The company memo said it wanted a 10-year deal and estimated it to be worth at least $55 million a year. It said product selection would rapidly multiply under a private distributor, but costs would rise. Exel has the Alberta monopoly under its Connect Logistics unit.
Richmond’s ContainerWorld is the biggest privately owned pre-distribution warehouse associated with LDB. The Exel memo said ContainerWorld has a close business relationship with Giorgio Gori, a company owned by Exel parent Deutsche Post DHL, and considered buying ContainerWorld for $24 million in order to get the contract.
ContainerWorld owner Dennis Chrismas hired lobbyist Mike Bailey to oppose privatization, but they met with Coleman on March 2 and entered the bidding.
Hillebrand Westlink is a Richmond-based joint venture between Germany’s J.F. Hillebrand and Quebec’s Simard Westlink.
The privatization is opposed by the NDP, the Association of Canadian Distillers and the Alliance of Beverage Licensees of B.C. because of the lack of business plan, lack of industry consultation and fear of higher costs. Coleman has not responded to repeated interview requests.
NDP critic Shane Simpson, who called the process “tainted” during Question Period on May 8, found in late June that the fairness monitor, George Macauley, was powerless to recommend tendering be postponed until the resigned LDB general manager Jay Chambers is replaced. Chambers leaves July 6 to join the Motor Vehicle Sales Authority of B.C. Chambers told staff and industry executives in May that he would lead the privatization process, but announced his resignation on June 14.
LDB’s Vancouver headquarters, including a warehouse, store and offices, were behind pickets on Tuesday during a 24-hour BCGEU strike. Talks between the union and government fell apart over a new contract. The BCGEU did, however, get a post-privatization job protection and early retirement accord for members on March 21, a month after the privatization was announced. During those memorandum of agreement talks, BCGEU agreed to cancel its proposal for Sunday openings. That proposal has been resurrected amid talks for a government-wide contract.
