That’s a great summary of points and I completely agree.

Cheers,

Shea

Well it looks like you’ve hit a nerve. Good to see people care this much!
1. Yes, land is expensive here and for non-estate vineyards, growers are often getting top dollar for mediocre grapes. Low yield is a factor in the pricing as well. I also think that with some wineries, “high” prices are a result of a their business model being based on protectionist advantages over imports and the fact that for a long time, demand outweighed supply. That is proving to be shortsighted, because there are now many wineries with back vintages to sell.
2. Many boutique BC wineries for years wouldn’t sell to retail. Partly because of low production, but also partly due to the fact that retail buys at a higher discount than restaurants and when demand outweighed supply, they took the highest short term profit scenario. That is proving to be shortsighted, because there are now many wineries with back vintages to sell. Some of these same wineries can’t offer enough to retail these days.
3. The inter provincial trade barriers are ridiculous and have to go! Plain and simple.
4. It is expensive for a BC winery to export wine to markets outside of Canada, but they can do it and I think they should. Relying 100% on your local market will prove again to be shortsighted. Vancouver…and BC is a gateway market, the world comes here, it can bring great press, attention and possible sales. There is a BC winery that sells out quickly every year, but they sold a handful of cases to world famous Panisse in S.F. Did they need to? No, did they get international press? Yes. And hey, their wine is in a highly internationally respected restaurant. Okay, I’m rambling. Basically, avoid the “eggs in 1 basket: scenario
5. VQA ensures place of origin and provides excellent marketing for BC wineries. Both very important. Let’s be clear, I don’t care if there is a testing process and a tasting panel, they are formalities. VQA has ZERO to do with ensuring quality. VQA can be important again, but right now, it has not been able to keep up with the growth of the industry.
6. We are in our infancy here and we will continue to grow. NAFTA took away a level of protectionist advantages and the industry needed to get stronger to compete and the wines got better. I think we are at that stage again. It’s kind of like stressing a vine to make it stronger. I think we need to stress the local industry to make it stronger.

About the prices of the BC wines released to Quebec this week, it depends on the winery and the wine. Oculus and Compendium, from Mission Hill, are actually lower-priced in Quebec than at the winery. Township 7′s wines are close to the same price as in BC. La Stella and Le Vieux Pin are well-above their cellar-door price. Differences in price depend on the wholesale prices that the wineries agreed to offer, and the fees grafted on by agencies. Obviously, some wineries and agencies take bigger margins than others.

Now (and this will interest Paul as well), the fact that wines in BC are usually significantly more expensive than in Quebec (I’ve seen 23$ wines at SAQ sell for 30$ at the BCLDB) tells me that getting the same price in Quebec as in BC should be achievable – and easier than for Ontario wines, where prices are marginally lower than in Quebec. I don’t want to underestimate the price pressure for the wineries, though: achieving the same retail price in Quebec than in BC requires wineries to sell wholesale to SAQ for a fairly low price (probably around 40% of retail). For wineries that sell most of their wine at the cellar door, this can be rather hard to swallow. Larger outfits like Mission Hill and Vincor, who have bigger volumes but also own their agencies/distributors, can be more accomodating to the pricing structure.

I was once told by a very successful winery in California that for them, selling outside California was more of a brand-building operation than a profitable sales channel. This is probably true for a number of Okanagan wineries who sell out of their wines easily through direct sales. I can understand that they would pick revenue over brand-building.

You are right of course, but as you mention there are no government initiatives (such as lower taxes) to help growers export and compete internationally (like Australia does) and when added to the internal legal restrictions on inter-provincial shipping, the environment is one that essentially makes it nearly impossible for anyone to get their hands on or taste the majority of BC wines.

Mission Hill Five Vineyards Pinot Blanc used to sell in Waitrose for £5.99 / btl if I remember correctly. So I would think it would be around £7-8 now. Cheaper than you could purchase it here with current exchange rate

Of course it is beneficial to moving beyond our borders and certainly essential for long-term industry growth.

There is nothing to stop a BC winery establishing its wines in top restaurants NYC or London now if it so desired – except the time and costs to do so in finding a willing buyer. The inanity of the situation is that cannot do that in a Toronto restaurant!

The extra Government controls impact distribution and pricing within BC only You are mixing up internal and external market arguments.If wine price is high because of your points about input costs (excluding taxes) then it stays high – relatively speaking – when compared against, say, WA wines. If our wine input costs make us uncompetitive in non-Canadian markets then we are dealing with a different issue, one of scale in particular. Remember there is nothing to stop a BC winery selling into a non-Canadian market today if it can find a market of willing buyers paying whatever price point it must sell at to make economic sense.

FYI in 2008, Decanter listed some BC wines entered in the WWA as priced at c. 30% of their LDB shelf price ex-cellar. Not sure what, exchange freight, distributor mark-up and UK import taxes would do the end price point.

All good points, but in my opinion a little short-sighted on the potential impact of distributing BC wines more broadly. Yes, BC cannot supply all wine stores, but there are a willing supply of consumers in WA for example that want BC wine. It is not so simple as to say BC wineries can ship internationally.

They can, but, because of the costs involved their wine prices are high. Additionally, the overall restriction on distribution impacts the diversification of their market within Canada, which I would argue is important. Further, the days of selling out BC wines in BC are long gone in my opinion.

Lastly, the biggest short sightedness about thinking BC should be the only market (which I don’t think many wineries actually think), is that even if you only sold a few cases to top restaurants in NYC, London, SF (as, for example, Ontario’s Le Clos Jordanne does) increases the reputation of the winery and the region, therefore having an impact on tourism. More renown for BC wine means more drivers for tourism in the province means more wine culture means more tourist dollars, etc. The trickle effect on the entire wine industry in the province (beyond just the wineries themselves) would be tremendous.

As to point 3 – It is too simple to just say government has a monopoly on wholesale for all liquor products. It also controls all licenses, controls all wholesale discounts, controls restaurant purchasing (which cannot be done via private retailers) and controls how agents are allowed to sell their wines in the province and how retailers are allowed to order. It is a far more comprehensive control than simply wholesale.

And, yes, that is a good point about the VQA – it has been important, but it is now no longer the only guarantor of 100% BC grown grapes.