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TODAY'S
LCBO
BALANCING PROFITABILITY AND SOCIAL RESPONSIBILITY
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The following describes the evolution of the LCBO from a staid distributor of beverage alcohol products to
an innovative, customer-focused and award-winning retailer.
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WHY
CHANGE? |
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We’ve been asked: Why change? You are a monopoly.
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The LCBO, in fact, has several competitors in the Ontario beverage
alcohol marketplace. These include the privately-run Beer Store network,
Ontario retail winery stores, U-Brews and U-Vints and cross-border shopping.
LCBO sales represent about one-third of the volume share of Ontario’s
beverage alcohol market.
The LCBO also competes for “share of wallet” – money that consumers may decide to spend with other retailers for things like Christmas gifts or pizza and a movie instead of a bottle of wine with dinner.
So it’s important that customers visit our stores because they want to, not because they
have to. Unlike other retailers, however, we can’t offer deep price discounts. That would not be socially responsible.
We’ve had to look for other ways to increase customer satisfaction, mainly by upgrading our stores, improving product selection and training staff to offer friendly, knowledgeable,
and engaging customer service.
Succeeding in a shared marketplace and providing the best possible
customer service have been integral to our vision and strategic plans.
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| STRATEGIC
PLAN IS KEY TO CONTINUING EVOLUTION |
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As we enter the last year of our long-term strategic plan (2008-13), we
resume our focus on building strong, relevant and respected brands that
resonate with our customers.
Our ultimate vision is to continually increase our customers’
engagement and satisfaction with the LCBO while empowering them with a
discovery experience that inspires, guides and delights them at each
point of contact.
Our goal is to provide our customers with a vast and exciting
selection of products to suit the needs of every budget backed by
multiple resources to support their purchase decisions. These include
comprehensive and up-to-date product information, best-in-class
marketing, informative hosting ideas, special events and consumption
guidelines for responsible beverage alcohol use.
Moving forward, we will continue to offer a shopping experience that
exceeds expectations, providing bright, attractive stores, a safe,
convenient retail environment and a vast collection of products from
distant countries and local suppliers.
We are extending our gifting opportunities with increased, year-round
product selection and also increasing the availability of our gift cards
at non-LCBO locations.
Customer interaction means removing the mystery from the products we
sell. We are achieving this via the in-store experience and by
communicating effectively across all media – print, internet,
e-commerce, websites and more. By equipping our employees with extensive
product knowledge, we are building the confidence of our customers and
taking them on a discovery experience that inspires, guides and delights
them.
Our customer commitment extends beyond the walls of our stores. Each
year, the LCBO redefines leadership in corporate social responsibility
through an integrated strategy that encompasses responsible retailing
and consumption, environmental sustainability, product quality and
safety, community involvement and fundraising.
From a financial perspective, our goal is continued business growth
in a dynamic and socially responsible manner, maximizing the returns to
Ontarians by returning $7.7 billion in net income over the life of the
plan (2008-13). We are on track in our efforts to grow sales from $4.3
billion in 2008-09 to $4.9 billion* in 2012-13 and net income from $1.46
billion in 2008-09 to $1.7 billion in 2012-13. We continue to expand the
number of new, relocated and renovated stores, maintaining a 12 per cent
minimum rate of return on investment capital while increasing access,
convenience, product selection and overall customer satisfaction.
Supporting Ontario winery and craft beer sales is another key element
of LCBO business practices. We take this commitment seriously through
promotional campaigns including “goLOCAL’ for domestic and VQA wines and
the “Know Your Craft” – Ontario Craft Beer thematic. These promotions
emphasize the economic and environmental advantages of supporting
home-grown products as well as citing their standards of excellence,
evidenced by the many awards they have received. As a champion of
Ontario wines, we inform consumers about the benefits of cool climate
viticulture and the uniqueness of Ontario’s food-friendly wine styles
and grape varieties as well as encouraging folks to visit their local
wineries. We are promoting pride in home-grown excellence and plan to
enhance our collaborative partnerships with domestic wineries in
2012-13, growing sales to $377 million.
As an employer, LCBO is attracting, retaining, engaging and inspiring
its employees to excel as part of a world-class organization. This means
offering employees opportunities to learn, grow and achieve their full
potential in healthy and safe work environments that promote harmony,
inclusion and diversity while building leadership capacity to ensure a
continuous supply of qualified talent.
Just as we encourage our employees to excel, the LCBO is reaching out
to its stakeholders, providing optimal customer service to our existing
clients and trade partners. We are striving to enhance current business
relationships with new information exchange systems and processes that
leverage fresh opportunities. As a progressive retailer, we continuously
source new clients to increase our product selection and to expand our
business outreach. From applying new efficiency enhancements to our
supply chain to leveraging pride in the growing profile of Ontario’s
craft brewers, distillers and wineries, LCBO is maintaining a
business-friendly environment that ultimately serves and benefits our
stakeholders and customers.
*In 2010-11, LCBO switched from Canadian Generally Accepted
Accounting Principles (Canadian GAAP) to IFRS, causing significant
changes to sales and expense numbers but not net income.
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| CUSTOMERS
SATISFIED, REVENUES UP |
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If you examine our customer research and look at our financial
performance, you’ll see the LCBO is doing very well on all counts.
Customer feedback continues to be positive. Customers like the changes we
have made. Our large-scale customer satisfaction surveys show that 84 per
cent of our customers rate their overall shopping experience as an eight or
higher on a 10-point scale.
A Customer Tracking Study is conducted annually and based on in-depth
interviews with 2,500 people across Ontario who say they are the primary
LCBO customer in their households. In 2010-11, 82 per cent said they found
it easy to move around LCBO stores; 76 per cent said the LCBO offers a wide
selection of products; and 75 per cent perceived staff as friendly and
outgoing.
Another way of assessing the shopping experience is our Mystery Shopper
program, which involves visits to our stores by unidentified shoppers
reporting on customer service and the appeal of stores. This program gave
stores an average overall score of 95 per cent in 2011. Mystery Shoppers
visit larger LCBO stores four times each year, smaller ones once a year.
In 2011-12, we delivered our 18th record dividend – $1.63 billion
– to the provincial government. This figure, which does not include
taxes, was $80 million (5.2 per cent higher) than the previous year.
Our net sales were also a record at $4.7 billion, 4.9 per cent
higher than the year before.
The provincial, federal and municipal governments also received $2.4
billion in taxes, import duties and payments to municipalities. As of
June
2012, these figures were unaudited.
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| LISTENING
TO CUSTOMERS PAYS DIVIDENDS |
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How did we know what changes would work? Customer research. We learned and we continue to learn more about our customers – who they are and what they want.
We went beyond standard demographic research into segmentation studies. These studies separated our customers into distinct groups based on
shopping behaviour and lifestyle, as opposed to age. This has helped us better understand customer interests and shopping habits and tailor our retail and marketing strategies accordingly.
We've also done large and small telephone and in-store surveys. We have done everything we can to learn more about the products and services the buying public wants. Research also guides the LCBO’s major social responsibility campaigns.
We measured what was important and behaved like a private sector company, observing other retailers and adapting successful ideas without compromising good public policy or social responsibility.
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| PRICING POLICY |
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In setting retail prices for the products it sells, the LCBO strives to
balance several key elements of its mandate.
Promoting social responsibility in the sale and consumption of
beverage alcohol
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Providing excellent customer service, including offering customers a
broad product selection and value at all price points
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Generating maximum profit to fund government programs and priorities.
The LCBO also ensures that it meets the legislated requirements under the
Liquor Control Act concerning minimum price and uniform price. (Minimum
prices are the lowest prices that products can be sold and uniform price
requires the price for a particular product to be the same throughout the
province)
To achieve this necessary balance among the key elements of its mandate,
and to meet public sector standards of openness, fairness and transparency
when it buys products for resale, the LCBO uses a standard mark-up pricing
structure. Mark-ups vary by product category (among beer, wine, fortified
wine, spirits, liqueurs for example) and there is an additional charge on
imports to cover supplementary costs associated with those products, but
otherwise the mark-up is consistent for all products. For example, all
domestic whiskies are marked up at the same rate and all imported whiskies
are marked up at the same rate.
This standard mark-up pricing structure, established by the LCBO in
consultation with the Ministry of Finance many years ago, allows suppliers
to be confident that the LCBO provides fair and equitable treatment to its
business partners.
As a result of the LCBO’s fixed mark-up structure, when LCBO buyers and
suppliers discuss possible purchases, they focus on the product’s final
retail price. The payment to the supplier for the products follows
automatically from the application of the fixed mark-ups and other elements
of the pricing structure (for example, freight costs and currency exchange
rates if the purchase is in a foreign currency). As part of the agreement to
purchase, the supplier must provide the final quote or cost to the LCBO,
usually per case.
While the quote is derived from the agreed-upon retail selling price,
suppliers occasionally make mistakes in the quote price due to changes in
freight or currency rates or as a result of calculation errors. The LCBO’s
practice had been to ask suppliers to correct any errors. Beginning in 2012, when suppliers provide a quote that is lower than that required to meet the
agreed-upon retail price, the LCBO accepts the lower price. This encourages
suppliers to be diligent in providing accurate quotes. If the price quoted
is higher than that required to meet the agreed-upon retail price, the
supplier is asked to provide a lower quote.
LCBO buyers make every effort to get the best products in each price
band, whether for sub-$8 wines, or super-premium spirits. They review more
than 50,000 submissions annually and negotiate with suppliers to make the
best of these products available at good prices. The LCBO is an attractive
customer for manufacturers and there is fierce competition for listings. As
a result, suppliers frequently submit products to the LCBO at prices lower
than those charged to other jurisdictions.
The LCBO’s social responsibility mandate means that pricing strategies
practiced by some private sector retailers or retailers not selling beverage
alcohol products are not appropriate to the LCBO. For example, private
retailers sometimes choose to offer some products at below cost or at a much
reduced mark-up as “loss leaders” to attract customer traffic. This strategy
would be inconsistent with the LCBO’s mandate to promote socially
responsibility in the sale and consumption of beverage alcohol.
For more detailed information on LCBO pricing see the LCBO Customer
Service portion of the website:
http://service.lcbo.com/app/answers/detail/a_id/570/kw/pricing
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| BOLD
MODERNIZATION PLAN |
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In 1998, the LCBO – with the support of its board and government –
embarked on a bold modernization plan – to be Ontario's Source for
Entertaining Ideas. We listened to our customers and were
poised to take action.
We made major changes to the store network by:
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Bringing stores in off back streets |
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Improving their look inside and out |
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Making the look consistent, including displays and signage |
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Improving accessibility and parking |
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Closing or consolidating stores that no longer met customer needs. |
We also looked at value-adds for our customers. In larger, destination stores we offered a full range of products and services including tutored tastings.
In smaller communities that couldn’t support a regular LCBO store, we
partnered with existing private sector retailers to open agency stores to
fill in service gaps.
Since 1962, privately-owned agency stores had provided beverage alcohol
service to smaller Ontario communities, mostly in Northern Ontario. There
was an expansion in the 1990s, making beverage alcohol retailing more
convenient, cost efficient and socially responsible while serving a broader
consumer base. By extending its services, the LCBO brought additional
revenue to communities and increased their overall business base by giving
rural consumers another reason to shop locally. A further expansion was
undertaken in 2002.
The number of agency stores at the end of 2011-12 was 219 representing
2.1 per cent of total LCBO sales.
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| RESEARCH
LEADS THE WAY |
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How do we continue to leverage our vision to help grow the business and
increase our revenues? Customer research, of course.
For example, LCBO sales trends have shown that the interest in mixed drinks and cocktails is growing but our research also shows many consumers mistakenly think making mixed drinks is difficult and time-consuming.
So the LCBO, together with our suppliers, launched annual promotions in
our 630 stores across Ontario that include demonstrations and
shaker cocktail recipes for hosts.
These promotions show that spirits are fun and ideal for entertaining
because of their mixability, diversity and ease of preparation.
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| INVESTING
IN OUR PEOPLE |
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Great stores and selection alone don't win over customers. You need great
service too; so we invested in our people.
We made product knowledge courses mandatory for all retail employees. A
program called Service Knowledge better prepares them to answer questions
from customers with confidence.
We partnered with the Wine Council of Ontario to educate our employees
more about products and developed a program called World of Ontario Wines,
in which more than 300 employees in our biggest stores are designated WOW
Leaders to promote the sale of Ontario wine.
Other employees have become “Beer Ambassadors” to promote consumer beer
knowledge and interest while a “Spirits Advocate” program does the same for
spirits. Ongoing training is provided to update employees’ product
knowledge.
We also undertook large-scale employee attitude/engagement surveys and
learned our employees must contribute to and understand our vision to embrace it. They must understand
our goals and what they can do to
help achieve them. They must know our core values – customer
service, social responsibility, excellence and integrity – and how they can
bring them to life.
This approach defines what customer service means to an organization
that subsequently trains and motivates staff to provide that service. There
is a one-to-one correlation between employee trust and profitability: The
more employees believe management supports quality service, the more
profitable that organization will be.
Employees must be engaged which, at the LCBO, means being part of a
world-class organization where they can learn, grow and maximize their
potential.
This includes leadership development programs and a
coaching culture to identify the leaders of tomorrow,
ultimately making sure they have the skills and knowledge
required to take the LCBO into the future.
It means transferring corporate experience and
knowledge to the next generation through mentoring and
job-shadowing and making succession planning a top
priority throughout the organization.
It also means promoting a harmonious and inclusive
work environment and enhancing health and safety to
achieve an accident-free workplace.
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| SOCIAL
RESPONSIBILITY: A KEY PART OF OUR MANDATE |
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 | Click to Enlarge | Selling beverage alcohol responsibly is a public trust the LCBO has taken
seriously since its creation in 1927. Over the years, LCBO has had
a strong and consistent commitment to socially-responsible programs,
practices and actions:
responsible retailing promoting responsible consumption
through education and advertising reducing our
environmental footprint by eliminating plastic bags, increasing
lightweight packaging and encouraging customers to return containers for
a refund
making sure products sold by the LCBO meet the highest quality and safety
standards fundraising to support charities and community
organizations in Ontario.
Today, consumers expect a higher standard of corporate social
responsibility and a greater commitment to the environment from the
companies they do business with. The LCBO is evolving and continuing to
integrate Corporate Social Responsibility (Corporate SR) into all points of
contact with our customers beyond what has been achieved in the past.
Corporate SR practices are as important as our mandate to provide a high
level of customer service and maximize dividends for the provincial
government.
Corporate SR at the LCBO includes:
Social responsibility advertising campaigns such as Deflate the Elephant,
which encourages Ontarians to speak up to help prevent friends, family
members and guests from drinking and driving. Visit
www.deflatetheelephant.com
for interactive hosting scenarios, the Home Bartending Challenge to master
the perfect pour, downloadable tips and tools, as well as a free iPhone
“Speak Up!” app and Facebook site.
LCBO has developed major advertising campaigns since 1995, in partnership with MADD Canada and independently, to raise awareness about the responsible use of alcohol and the dangers of impaired driving. These campaigns have included TV, radio, print, cinema, bar washroom and outdoor advertising across Ontario.
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All LCBO retail employees participate in Challenge & Refusal: It’s not
personal. It’s the Law. training program to enable them to challenge and
refuse service to anyone who appears underage and cannot provide valid proof
of age ID, appears intoxicated or are suspected of buying for either group.
They challenged 6.3 million individuals in 2011-12 and refused
service to more than 290,000 people – 84 per cent because they could not
provide valid proof of age ID.
To take the social responsibility message into high schools, LCBO develops safe prom and
graduation campaigns that include posters, prom tips for students and
parents, information resource packages and web-based resources for teens,
parents, teachers and counsellors. LCBO’s longstanding
partnership with MADD Canada, which includes fundraising in LCBO stores
to support the production and delivery of MADD Canada’s School
Assembly Program. Other social responsibility joint
initiatives include television campaigns and the development of
Talk to your kids about
alcohol website, aimed at parents of preteens to help prevent
underage drinking. The website provides tools and tips to promote
dialogue with their children about alcohol, helping them make informed
and smart choices.
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Helping to protect the environment through the Ontario Deposit Return
Program and support of the Blue Box program, working with suppliers to offer
more products in lightweight packaging and encouraging customers to use
reusable bags. LCBO also recycles cans/bottles/PET containers, defective
alcohol, corrugated cardboard, fine paper, newspaper, batteries, printer
cartridges, data tapes and other materials, as well as working to reduce the
use of energy in stores, warehouses and offices. To learn more about LCBO’s
environmental sustainability initiatives, visit
http://www.lcbo.com/enviro/ In 2011, LCBO customers and
employees raised more than $6.2 million for a variety of worthy causes.
Employees also rallied behind the annual United Way campaign, raising more
than $2.5 million through payroll deductions, special fundraising events and
customer donations. These funds support social and health services to
deliver community programs and tackle social issues province-wide.
Thanks
to the generosity of LCBO customers, $5.7 million was raised through
in-store fundraising for various provincial and numerous local charities
through prompted donations and cash boxes at store checkouts. Support was
given to organizations such as MADD Canada, Friends of We Care and Camp
Oochigeas which helps children with cancer. LCBO employees are also actively
involved in many individual fundraising efforts in their communities.
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| HELPING
SUPPORT WORTHY CAUSES |
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While it may not make cash donations or sponsor events, LCBO and its employees
are committed to assisting charitable organizations. Donation boxes are placed at checkouts each month to collect funds for
designated charities and customers are sometimes invited to make a
donation at the checkout.
In 2012, LCBO is supporting the following charities: click here.
Local charities also benefit twice a year, in January and July, from the
in-store donation box program.
These charities include organizations fighting impaired driving – such as
MADD Canada and Ontario Students Against Impaired Driving – as well as the
four Ontario children’s hospitals, the United Way, Canadian Cancer
Society and many others.
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OUR ENVIRONMENTAL COMMITMENT |
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LCBO has a longstanding commitment to reducing its environmental
footprint and developing initiatives with industry suppliers. LCBO recently
launched its second sustainability report outlining the organization’s
environmental strategy, activities and accomplishments. Here are a few
examples of how LCBO is helping to lessen its impact on the environment.
The Ontario Deposit Return Program – Bag it Back – was
launched in February 2007. Through this program, consumers pay a deposit
on LCBO containers and receive a refund when returning containers to The
Beer Store. The deposit is 10 cents and 20 cents depending on the size
of the container.
The Bag it Back program is helping to divert significantly
more glass and other beverage alcohol containers from landfill sites and
results in more containers being recycled into higher-end uses,
including new glass bottles, fiberglass and polar fleece.
The program has been a great success with a return rate of 77.9 per
cent in 2010-11, amounting to more than 370,000 tonnes of glass, as well
as cans, plastic and other containers. It is also freeing up space in
the Blue Box program, giving municipal governments an opportunity to
expand recycling programs.
• The LCBO has also been a leader in supporting Ontario’s Blue Box
recycling program and has contributed more than $40 million in recent
years to Ontario’s cities and towns as well as helping develop new
markets for coloured glass.
• The LCBO has become a recognized leader in the promotion and sale
of lightweight packaging for beverage alcohol, including Tetra Pak
cartons, PET (polyethylene terephthalate) plastic bottles, aluminum cans
and, increasingly, lightweight glass.
• The LCBO announced in June 2011 the official date for
implementation of the 420-gram standard for wines under $15 which will
commence in January, 2013.
• In 2008, the LCBO phased out plastic bags in all its stores in an
effort to reduce reliance on disposable shopping bags and encourage
customers to opt for reusable alternatives. This initiative has
eliminated 80 million plastic bags. Customers now have a variety of
reusable bags to choose from or they can bring their own. Customers can
also opt for free paper bags made up of 40 per cent recycled content and
are recyclable through the Ontario Blue Box program.
• Reusable bags are available in LCBO stores and a portion of sales
of reusable bags, together with proceeds from other fundraising efforts,
go to the LCBO Natural Heritage Fund, which supports community-based
projects to preserve or restore wildlife habitat.
• Suppliers are encouraged to minimize packaging while adhering to
the LCBO’s Product Packaging Standards.
LCBO's environmental strategy has five specific goals:
• Reducing package waste generated by LCBO sales
• Increasing the rate of material diverted from landfill to recycling
and re-use
• Improving all aspects of environmental management
• Reducing consumption of energy and utilities at LCBO facilities
• Promoting re-use and conservation.
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ASSURING THE QUALITY, AUTHENTICITY OF
PRODUCTS |
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Products sold in LCBO stores must first be tasted, tested and certified
by LCBO’s Quality Assurance department.
This means products are safe to consume, authentic and meet the standards
set out in Canada’s Food and Drugs Act and Consumer Packaging and
Labelling Act and their related regulations.
Every year, more than 500,000 tests are performed on more than 22,000
products.
The lab is world-renowned and meets the high standards set by the
Geneva-based International Organization for Standardization (ISO). The
LCBO’s Quality Assurance department is registered under ISO 9001:2000 as
well as under ISO/IEC 17025, a designation specific to chemistry
laboratories.
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| SUPPORTING
ONTARIO'S WINE INDUSTRY, CRAFT BREWERS |
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As a government agency, LCBO has worked very hard to support our domestic wine industry and craft brewers. We have:
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Partnered with the Wine Council of Ontario and the provincial government to develop an overall wine strategy.
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Introduced a dedicated team to manage all Ontario Wines (LCBO and
VINTAGES combined), including a category manager, product manager
and a category administrator
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Trained some 300 employees in our stores to act as specialists in Ontario wine – WOW Leaders – who can help customers and colleagues alike learn more about the value and versatility these wines offer.
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Expanded the highly-successful Ontario Wines Superstar program to
include VINTAGES Superstar, supporting and showcasing VINTAGES
Essentials on a monthly basis to new consumers
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In August 2011, four Ontario craft brewers were highlighted as part of
our “Brewery Spotlight Program” and featured one limited release
from each of the four participating brewers.
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Ontario craft beer was promoted in a mini-thematic in September 2011
called “Know Your Craft” – Ontario Craft Beer. The program included
an informative pamphlet about craft beers and profiled 13-world
Ontario products.
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Four Ontario Craft Brewers discovery packs were developed and brought
to market in 2011.
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ONTARIO CONSUMERS LOVE
CANADIAN WINES |
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LCBO loves
Canadian wines, and so it appears do its customers. The LCBO’s I Love
Canada promotion that ran from mid-June to mid-July boosted sales of
Canadian wines 7.6 per cent over the same time last year.
Promotional efforts like I Love
Canada and LCBO’s year-round support for Canadian wines are producing
results. Ontario VQA table wine sales at LCBO increased nine per cent in
2011-12 over the previous year, outpacing LCBO wine sales as a whole which
increased by 5.7 per cent. Sales of BC wines through all LCBO channels
exceeded $6.2 million in 2011-12 and are projected to be even higher this
year as more BC wines are making their way on to LCBO shelves.
LCBO’s Private
Ordering program is making it more convenient and faster for customers to
access Canadian wines, spirits and beers from across the country that are
not available through its stores or online sales channels. For information
on LCBO’s Private Ordering program,
click here.
In June 2011, LCBO adopted a policy clarifying that it
is legal for individuals to bring wines, spirits and beer into Ontario on
their person from other Canadian provinces or territories, as long as it is
for personal consumption.
Established under the Liquor Control Act, the
policy allows Ontarians of legal drinking age to bring up to three litres of
spirits, nine litres of wine and 24.6 litres of beer from other provinces
and territories. Most provinces and territories have comparable provisions,
though some have importation limits that are lower than Ontario.
The new policy should dispel any confusion that this
practice is not allowed.
“I am proud that Ontario supports not only its own wine
industry, but also wines from other Canadian provinces, “notes Ontario
Finance Minister Dwight Duncan. “The measures the LCBO has taken rightly
help the domestic wine industry and the Canadian economy, create jobs and
also generate revenue to support provincial government programs and
services.”
From September
16 to October 13, LCBO will be presenting its annual fall Ontario wine
promotion featuring a wide range of quality wines in all LCBO stores.
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| SUCCESS
BY ANY MEASURE |
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The transformation of the LCBO has been a success by any measure.
In 1991, the LCBO’s annual revenue was $1.8 billion and the
dividend was $675 million.
In 2011, annual revenue was $4.7 billion and the dividend was $1.63
billion. This did not include $767 million in HST, excise taxes and
import duties. When payments to municipalities were included, the total
was $2.4 billion. (As of June 2012, these figures were unaudited.)
Our strategic plan for 2008-13 projects more than $7 billion in
dividends by the fifth year.
Dividends help pay for health care, education and other important
social programs and major capital projects.
The LCBO has also been successful in containing costs, as reflected
in expenses-as-a-percentage-of-net-sales.
This figure was 15.8 per cent in 2011, better than 16 per cent a year
earlier. Each one per cent reduction in operating expenses translates
into $45 million in savings.
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| STRONG
RETURN ON CAPITAL INVESTMENT |
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New and renovated LCBO stores are designed to be bigger, brighter and better located than the stores they replace. This not only increases customer satisfaction in measurable ways but increases sales that ensure a solid return on LCBO’s capital investment.
All real estate decisions are guided by extensive customer research and market analysis to ensure they meet the needs of urban and rural communities of all sizes, and by rigorous financial analysis.
The business case developed for each capital project includes a forecast of incremental expenses and sales – netting out both current sales growth trends and negative impact on sales at nearby stores in the trade area – to ensure an accurate forecast of the project’s return on investment. All major capital projects must show a projected return on investment of at least 12 per cent to proceed.
Following completion, financial performance is reviewed annually and
compared to the forecast. Eighty-one of 93 stores tracked during an
eight-year period were performing on forecast or better than forecast.
Our integrated marketing initiatives, which include in-store displays, newspaper inserts, broadcast advertising and
web-based promotions, have played an important role in building customer traffic, increasing sales of featured products and enhancing the LCBO brand.
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| A MEASURE
OF SUCCESS: MORE THAN 200 AWARDS IN 10 YEARS |
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Two LCBO Sales & Marketing managers display the awards received from
the Canadian Marketing Association. |
As a socially-responsible retailer, LCBO can benchmark its success, not
only through customer satisfaction surveys and financial results, but also
through the recognition it has achieved, often in open, juried competitions.
To date, LCBO has won well over 200 awards for store design, staff training
and development, innovative retail practices, marketing and communications.
These include 13 Retail Council of Canada Excellence in Retailing Awards,
including Innovative Retailer of the Year, Socially Responsible Retailer
of the Year and the Retail Technology Award.
A 2010 Corporate Reputation Study conducted by the Leger Marketing, an
independent survey company, placed the LCBO 18 out of the top 100 companies
in Ontario.
Drinks Ontario, the association representing
imported wine, spirits and beer agents, has
recognized several members of LCBO management
with its Industry Partnership Award for their
efforts in enhancing the profile of imported
beverage alcohol products in the Ontario
marketplace. Recipients include: Tom Wilson,
Vice President, VINTAGES (2010); Bob Downey,
Senior Vice-President, Sales and Marketing
(2009); Dr. George Soleas, Senior Vice
President, Logistics/Quality Assurance (2008);
Greg Dunlop, Category Manager, European (2007);
Shari Mogk-Edwards, Vice President,
Merchandising (2006).
Below is a list of some of LCBO’s more
prestigious awards:
| 2012 |
|
The Retail Council of
Canada: 2012 Excellence in Retailing Awards:
LCBO Supply Chain won a Technology Award for
its deployment of QLogitek’s systems to
schedule warehouse appointments and automate
purchase orders.
|
| 2012 |
|
The Ontario Hostelry
Institute: Media and Publishing category:
Jody Dunn, manager/editor of FOOD & DRINK
magazine earned a Gold Award.
|
| 2012 |
|
The Canadian Marketing
Association presented LCBO’s Sales &
Marketing Division with two bronze awards in
the Retail Category for the promotions
goLOCAL (Ontario wines) and Cocktails.
|
| 2011 |
|
The Telly Awards: “Film and
Video” category: LCBO’s Broadcast Production
Group earned silver (first place) for its
LCBO Safety video and bronze (second place)
for Challenge & Refusal: It’s Not Personal,
It’s the Law.
|
| 2011 |
|
ContactCentreWorld.com:
Best Contact Centre in the Americas under 50
agents: LCBO’s Contact Centre was among the
top three finalists in annual global
competition.
|
| 2011 |
|
Retail Council of Canada:
LCBO tied with Staples Canada in the Retail
Store Design, Large Retailer category: LCBO
was recognized for its flagship Oakville
store’s “thoughtful design with cutting-edge
features.”
|
| 2011 |
|
Ontario Safety League:
Deflate the Elephant campaign earned a
Public Safety Award
|
| 2010 |
|
The Canadian Marketing
Association presented LCBO’s Sales &
Marketing Division with a bronze award in
the Retail Category for its goLOCAL campaign
which promoted Ontario wines.
|
| 2010 |
|
The International Council
of Shopping Centres: Store areas in excess
of 10,001 square feet: Gold Maple Leaf award
was presented to LCBO’s Store Development
& Real Estate for 321 Cornwall Dr. store
in Oakville.
|
| 2010 |
|
Bill Kennedy, Executive
Director, Corporate Communications, received
MADD Canada's Citizen of Distinction Award
in September 2010 for championing LCBO's
efforts to promote responsible drinking,
help prevent drinking and driving and raise
funds for MADD Canada.
|
| 2010 |
|
A bronze Telly Award was
presented to LCBO's Broadcast Production
Group for TV spots created for an Ontario
Wine "goLOCAL" promotion. The international
award was in the "Regional TV Commercials -
Alcoholic Beverage/Beer" category. The Telly
Awards honour the very best local, regional
and cable television commercials and
programs as well as the finest video and
film productions.
|
| 2009 |
|
The Niagara Wine Festival
named Bob Downey, Senior Vice-President of
Sales and Marketing, the RBC Financial
Group's Business Citizen of the Year.
|
| 2009 |
|
The International Council
of Shopping Centres: Store areas in excess
of 10,001 square feet: Silver Maple Leaf
award was presented to LCBO’s Store Design
and Real Estate for 1838 Avenue Rd. store in
Toronto.
|
| 2009 |
|
Canadian Marketing
Association: Retailing Category: Gold and
Silver Awards for the Red Wine 101
promotion which helped demystify red wine
buying for customers.
|
| 2009 |
|
New York Festival’s
International Film & Video Awards: Internal
communications category: Bronze award for
Play it Safe, a training video used to
teach store staff how to effectively deal
with shop theft; also won a Silver
Screen Award in the Training Safety category
at the U.S. International Film & Video
Festival
|
| 2009 |
|
The Retail Council of
Canada’s Excellence in Retailing Awards;
Retail Marketing/Advertising – Large Chain
category; LCBO’s “Eco Chic” campaign won top
prize
|
| 2009 |
|
LCBO Store Design & Real
Estate earned a grand prize in the Specialty
Food Retail Category from the Association
for Retail Environments.
|
| 2008 |
|
The Registered Graphic
Designers of Ontario Design@Work
Competition: LCBO’s Prom Tips campaign
poster, created to remind high school
graduates that alcohol doesn’t belong at
their celebrations, was declared a winner
|
| 2008 |
|
Strategy Magazine
named the LCBO “Integrated Marketer of the
Year”
|
| 2008 |
|
LCBO Store Design & Real
Estate placed first in the Specialty Food
Shop Category, an award presented by the
Institute of Store Planners and Visual
Merchandising & Store Design Magazine.
|
| 2008 |
|
Canadian Marketing
Association: Retailing Category: Bronze
award for the Wine 101 promotion
which helped demystify wine buying for LCBO
customers
|
| 2007 |
|
Strategy Magazine, Top
Integrated Marketer: Nancy Cardinal, LCBO
Vice President, Marketing and Customer
Insights
|
| 2007 |
|
Canadian Information
Productivity Awards: Chief Information
Officer of the Year: Hugh Kelly, LCBO Senior
Vice President, Information Technology
|
| 2007 |
|
Marketing Hall of Legends:
Andy Brandt, former LCBO Chair and CEO
|
| 2007 |
|
Retail Advertising and
Marketing Club Canada:
- First Place Retail Flyer Award, East Meets West
- Second Place Retail Flyer Award, Hot City Cocktails
|
| 2007 |
|
Whisky Magazine: Retailer
of the Year (Canada)
|
| 2007 |
|
Retail Council of Canada:
- Retail Supply Chain Award
- Excellence in Retailing, for New Item Submission
System
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