Eater

EATER: The SAQ is Getting In Between You And The Alcohol You Want

I love Lagavulin 16. My father-in-law introduced me to the scotch several years ago, cementing my fascination with fine spirits. The Islay icon is my go-to dram if I’m not experimenting with other ryes, bourbons, and scotch whiskeys.

But the price tag stings. I have to pay $119 for a bottle in Quebec, far more than many other North American locales. Privately-owned Liquor Depot stores in Alberta and British Columbia sell the same product for $100. Across the border in Maine, I can get one at the grocery store for $US80 (around $CA105).

So why is a bottle of Lagavulin 20 percent more expensive in Quebec? It’s the same reason that many wines and most spirits are more expensive in La Belle Province than other jurisdictions. The price reflects a problem in how Quebec’s government-run alcohol corporation, the SAQ, is managed.

The SAQ doesn’t operate like a normal business — it functions like a bureaucracy. Despite being one of the world’s top liquor buyers, it doesn’t bargain for bulk deals. Instead, it puts out a request for proposals with a price floor. For example, it may tell producers something like “we are taking bids for a chardonnay that retails between $14.95 and 16.49.” It’s then up to wine agents to change their price accordingly. The selected wine might typically sell for $12 in a competitive market, and the producer would have sold it to the SAQ for less — but the government never asked. So Quebecers get stuck with the bill. Quebec isn’t alone: Canadian public monopolies pay anywhere from three to 77 percent more than other international importers for wine.

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