CBANS Replies to Editorial

CRAFT BREWERS ASSOCIATION OF NOVA SCOTIA
RESPONDS TO EDITORIAL

Earlier this week former business leader, editorialist, and blogger, Bill Black wrote a piece regarding Nova Scotia alcohol industries. While Mr. Black is entitled to his opinion, it is unfortunate that it is not based on fact, or the reality of the beer industry in Nova Scotia.

Mr. Black’s assertion that we receive a subsidy is just not true, and I would argue, an educated mistruth. Our 35 breweries are owned by Nova Scotians in your communities and we open and operate our businesses without any subsidy from any level of government. Perhaps he has us confused with the large subsidies given to Big Beer in the past to keep breweries open in various provinces. Mr. Black would know that no jurisdiction in Canada confuses tax policy with direct subsidy.

It is true that the Province of Nova Scotia did announce a lower remittance rate for our industry but let’s not overstate the financial cost of this change. This year, the announcement means $800,000 less in remittance for the NSLC, but given the growth of our industry (35% a year), the NSLC will get back to current revenues within three years.

Furthermore, given that the NSLC sends $241 million a year to the Nova Scotia treasury, the remittance reduction represents 0.32% of their profits. Given the extensive operations of the NSLC ($345 million in sales), if the NSLC’s profits in any year are reduced by 0.32% it might be a bit simplistic to place all of the blame on our industry. It is laughable to make the even larger leap that we are to blame for any lack of investment in Nova Scotia’s health care system.

If Mr. Black were to broaden his research, he would have noticed that the NSLC sent $12 million more the Nova Scotia treasury this year than last. If Nova Scotia craft beer is so harmful to the NSLC’s profits and to the Nova Scotia treasury, what explains this increase?

The unspoken truth is that while Bill Black and others may loathe our progress, the NSLC and Big Beer have no problem making money off of the backs of our success. Our breweries have spent tens of thousands of their own (unsubsidized) dollars to develop a craft beer market in communities like Sober Island, Nyanza, Port Williams, and Liverpool. Nova Scotians want our beer. Our sales grew 25.5% last year in NSLC stores, while Big Beer sales flatlined. The NSLC is doing pretty well by Nova Scotia craft beer.

This is why Big Beer has been able to own and operate “craft breweries” in Nova Scotia even though it contravenes the NSLC’s own policies. This is why the NSLC has announced plans to spend millions of your dollars to open a beer store on Agricola Street in the heart of a craft beer market that at least five craft breweries have spent years and thousands of dollars cultivating. 92% of the beer the NSLC sells comes from multinationals, and this new store subsidizes their entry into a local market to directly compete with eight of our small breweries.

Why is Bill Black not outraged at yet another subsidy to Big Beer? Why is Bill Black not outraged that the NSLC is spending millions to open a store to compete against small Nova Scotia craft breweries instead of sending that money to the treasury for health care?

Does Mr. Black really care about the Nova Scotia craft beer industry not contributing enough to our health care system, or is it more about our contribution to NSLC revenues?

It is time for the NSLC to not simply profit from the Nova Scotia craft beer industry, but it is time to work together, to understand the benefits of a vibrant Nova Scotia craft beer industry. It is time for the NSLC to live up to it’s strategic plan when it says,
“Our promise to our local beverage alcohol industry is to: 
• Continue and expand ways to get product innovation to our customers
• Act as an enabler to the overall success of the industry
• Act as a partner, using our retail expertise to promote our great local products”

We have lived up to our end of the bargain. We have developed a strong and vibrant craft beer industry in Nova Scotia that has now become the only growth segment of Nova Scotia’s beer market. We have developed world class products that wins international awards and are exported to every province in the country.

We have created an industry that employs over 400 Nova Scotians in every region of the province. We employ more Nova Scotians with our 8% of the beer market than the multinationals that make up the other 92% of the market.

It is time for Bill Black and his friends to understand the contributions our industry makes in this province, and that if they worked with us, we could actually make the NSLC a little bit more money too.

Contact:
Kirk Cox, Executive Director
Craft Brewers Association of Nova Scotia
kirk@nscraftbeer.ca

by CBANS