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BC Announces New Wholesale Price Model for Wine

(UPDATE: I am hearing that the following pricing model may be adjusted … however, there has been no confirmation of that yet.The BC Government announced a new wholesale pricing model for wine today, which will become effective April 1, 2015. On the same day, BC will start limited supermarket liquor sales as well as introducing changes that are intended to \”level the playing field\” between government retail stores and private liquor retailers: press release on liquor changes is here.

The new wholesale pricing model will mean that all retailers (government and private) will pay the same wholesale price when they purchase liquor from the wholesale arm of the LDB. At the present time, private retailers pay different prices depending upon their license type. Government stores don\’t pay wholesale prices at all because their revenue is simply blended between their retail and wholesale divisions. Under the old model, the LDB applied a 117%/51% markup on wine to generate a fixed retail price which was used as a reference point for all retail sales. Under the new system, the LDB will apply an 89%/67% markup on wine to generate a wholesale price – retailers will then be free to set their own end retail prices once they add their own markups.  

See my Liquor Changes (2015) Chart for a first attempt at creating comparison pricing between the old system and new system.