Monday, August 13, 2007

Alcohol Monopoly

I have been visiting Nova Scotia in Canada for a number of years (it is absolutely beautiful by the way) and usually I am critical of the concept of the Canadian state (well, the Provincial governments) having a monopoly on the sale of alcohol. You can check out the range here.

For those of us living in the UK or most of Europe, the idea that the state should control what wines or spirits should be available, where, and for how much is extraordinary (if you live or visit Sweden this is probably not such a shock for you).

[Some might argue of course that this is exactly where we are heading in the UK because of the retail strength of the supermarkets like Tesco - but even here we at least have a number of alternative ranges to choose from]

My reaction is usually - "How could one organisation tell us what wines we can drink?", especially when the result, at least in Canada, is a pretty limited range of branded wines?

The reason for this structure is most likely still a hang-over (!) from Prohibition (yes, they had it here too), and there is a sort of puritanical streak to the management of this 'vice' which I personally disagree with. It also means that there is a form of "lowest common denominator" effect at work which determines that all wine have to be available in minimum quantities to supply all stores, have to be consistent and also be able to comply with the kinds of red-tape only government departments are able to create. This often results in a pretty bland range.

However, there is one small silver lining to this was pointed out to me which I had not considered. In the UK we have such a high density of population that we can pretty well guarantee access to supermarkets or shops wherever we are, with a few exceptions of course. This means that the market can operate quite freely and there will be someone who can sell you what you are looking for within a reasonable distance.

When you take a country like Canada, this is definitely not the case outside of most large cities. So much of the infrastructure here depends on government support to reach tiny communities in distant areas, that if the government did not step in, certain items (especially luxury items such as wine) would either be impossible to get, or prohibitively expensive.

OK, so wine is probably not the main justification for this type of system, and I'm sure they make a pretty penny or two in tax from selling and taxing all that alcohol, but at least they can get it. Hopefully in time, and with a little popular pressure, the range will improve further.

I'm sure the local "liquor commission" would tell you that a monopoly also means that there are clear & limited channels for reaching consumers, giving the opportunity for 'managing' consumer alcohol consumption. I still think that in the longer term education works better than restricting access. However, thinking positively, it does mean there are obvious places to start reaching consumers with information on wine to educate and inform them and improve their experience.

Still, I'll take Tesco's range over the NSLC one any day!


Alastair Bathgate said...

In the UK, in addition to local super(hyper)markets, we are fortunate to have a wide range of direct wine sellers. This is surely a model that would suit a sparse population like Nova Scotia?
I buy much more of my wine for home delivery than from shops.

Robert McIntosh said...

True, I do too, but we are "not normal" in the nicest sense of that phrase!

This would also require a major infrastructure of delivery companies (something we have not solved even in the much more densely populated UK). The key to online delivery of any sort is actually the delivery after all!

In any case, until they decide to relinquish the retail monopoly, his can't happen, and for a country so used to this model, direct selling is a frightening prospect. Just look at the resistance to shipping between states in the US.

Anonymous said...

Ah the Government just wants its taxes to pay for thir own extravagence