Want to maintain its current profit margin
There are countless consequences of this potential move, including a guaranteed spike in black-market purchasing of wine by local restaurants and consumers in Alberta, where product is significantly cheaper, which will add to that province’s coffers and hemorrhage B.C. tax income.
But let’s look at this by referencing what’s right here in front of me at Cactus Club. I’m going to take some liberties by making some speculative calculations of price increases, based on a formula created by Mark Hicken, a Vancouver-based lawyer who specializes in wine law. I’m assuming that Cactus Club would want to maintain its current profit margin.
Cactus Club lists California’s J. Lohr Seven Oaks Cabernet Sauvignon ($22.99, B.C. Liquor Stores) at $12 per glass. Under the new system, that government liquor-store price will hover around $29, immediately bringing that $12 glass to $15. Not into a California Cabernet or being so spendy? Germany’s Selbach “fish label” Riesling ($17.95, B.C. Liquor Stores) is a citrusy, delicious $9 glass of wine. Under the new system, we’re looking at about $20.50 in stores, and that $9 glass can easily go up to $11.
Don’t assume that going by the bottle will ease any pain. Argentina’s Viña Chela Organic Malbec is $14.99 in government liquor stores and on the wine list at Cactus Club for $32—a standard markup of just over 100 percent. Come April, we’re looking at adding around $2.50 to the shelf price and potentially about $5 more on the list here, bringing it to roughly $37.
Should this system be implemented, restaurants will likely take a major financial hit. Really, either it’s restaurants that are going to have to absorb way higher costs, or it’s going to be you. I’m guessing you don’t want it to be you.