2012 Vancouver Playhouse Wine Festival

c. Paul Rickett, 2012

In the span of 10 years, Canada's wine consumption will have grown 6 times faster than the world average

Canada now ranks as the world's 5th biggest wine importing country

Between 2010 and 2014, wine sales volumes are expected to grow by a further 19% domestic wines will see a 26% increase, meaning that Canadians will consume 14.6 million cases of locally-produced wine

VinExpo, Montreal, Feb 2011


Enhancing the Retail Experience

Paul RickettVARKETING!/Bowen Island Beer and Wine Cellar


CAUTIONData collection &

analysis in progressNumbers will Wobble


The current patchwork quilt of license types, conditions and discounts plus the moratorium on new stores leads to:

Unfair competitionMarket distortionsUnder-served consumersDistribution inefficiencies

Despite often working with one hand tied behind it’s back an ecosystem has evolved that’s not been unsuccessful in serving the larger needs of the market as a whole....not perfect and still finding its feet


3rd Highest per capita wine consumption in CanadaAfter Quebec and Yukon,

BC AB SK MB ON PQ NF PEI NS NB YK NWTCanada0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

British Columbia

3rd Highest per capita wine

consumption growth since 2003After Saskatchewan & =AB, PEI

BC AB SK MB ON PQ NF PEI NS NB YKNW

T

Canad

a0%

20%40%60%80%

100%120%140%160%180%200%

Growth Since 2003


2002-2004 Pivotal Years for distribution in BC

•Government Flip-Flop on Privatization•Private reseller expansion in both LRS & RAS• Spirits added to product mix• Store size limits removed (’05)• Separation from LP (’09)•BC Wine industry gets to #2 category• Marking the start of the 2nd Growth Phase


-27% change in GLS market share

18% growth in Licensee sales $

61% growth in Wine consumption litres (18%+ BC)

97%+ growth in BC wine sales by litre

107% growth in wine sales $

133%+ growth in BC wine sales $

171%+ growth in LRS sales $ BC wines (from ‘05)

177%+ growth in LRS sales $

By the Numbers 2003-2011


CinderLRSa is going to the Ball


2012 LRS Wine Profile Survey

Early Results


GLS

LRS

RAS

VQA

IWS


Region Population per store(All types)

BC 3,300

AB 1,600 (Class D)-2,300 (Retail)

Metro Vancouver 7,300

Abbotsford 6,800

Greater Victoria 4,500

Courtenay/Comox 4,000

Nanaimo 3,300

Kelowna 4,000

Kamloops 3,800

Prince George 2,700

Bowen Island 1,500

Sample Population per Store

Benchmark: Kentucky legislation permits one retail alcohol license per 1,500 people in rural and 2,300 in cities


In Pursuit of the 15.9L

Total Wine by Channel By Net $ to BCwineries

BCW

LIC

LRS G

LS

VQA

IWS

RAS

RAS

IWS V

QA

BCW

LRS

GLS

LIC


LRS

GLS

IWS

$

$

$ c.900

1,259

1,300

4100

<1800

c.3,250

=$1M sales p.a. =$200K/FTE

Includes sales to channels?


Benc

hmar

ksLiquor Stores NA $1.9M per Canadian store p.a.24.8% GPM, •Only publicly traded liquor retailer in Canada. •Owns 35 IWS and LRS stores in BC, 172 in AB and 29 in USA, •overall GPM is lower due to wholesale and US stores

Annual Report 2010BC same-store sales decreased 1% in 2011 to date

MD&A 9 months to Sept 11

US Beer and Wine stores Net 27% GPM (equiv to a 37% markup after discounts)

US census 2009 for NAICS 4453


Benc

hmar

ks Sales per Square Foot

Walmart Canada - $340-440 (GPM 26.9%)Undated Project & Development impact study for City of Vancouver

Costco – $800-$950

Revenue per employee/GPM

Starbucks - US$60K/57%,

Costco - US$530K/13.4%From web


Sample Key IndicatorsLRS GLS

(Excluding Signature Stores)

Wine SKUs/Store 750 (median) 850 (mean)

Shelf space dedicated to wine

52% N/A

% wine sales $ of total 26% c. 36%

Wine Shelf efficiency 54% (median) N/A

BC wine SKUs/Store 200 (mean) 102 (mean)

BC wine SKU as % of total wine SKU

24% 12%

BC wine revenue as % of total wine sales

16% 11%


Report Outputs•Regional differences•Differences between small, medium, large LRS•Regional by size differences•High volume wine vs rest

•Store size•Linear feet of shelving for wine and BC wine•Performance of imports vs BC wine•Wine SKU counts•BC wine SKU counts•Spec vs Listed•Cooler doors and cooler doors for wine•Shelf efficiency•Wine to other products ratio•Product density•# BC wine brands

•Wine Sales %•BC wine sales %•Sales per Square Feet•Sales per FTE

Plus•Comparisons to VQA, IWS, GLS•Useful benchmarks•Background industry info esp. On BC wine


Final Report April

Input cut-off 31st MarchPlease contribute your dataAgents: Encourage response

ContactPaul Rickett(604) [email protected]: @paulrickettLinkedIn: Paul Rickett

mailto:[email protected]

Business

2012 Vancouver Playhouse Wine Festival