When Good Robot Brewing’s Joshua Counsil heard the Nova Scotia and Ontario governments had finalized a deal to allow alcohol producers to sell directly to consumers in the other province, he said his reaction was “rather indifferent.”
“This is a story that got prospective customers much more excited than it got us,” said the co-founder of the brewery that has locations in Halifax and Enfield, N.S.
Breweries CBC News spoke with expressed mixed opinions about the initiative, with some saying they appreciate the symbolism of breaking down trade barriers, while others said there are more pressing issues facing Nova Scotia’s craft beer industry than a direct-to-consumer sales agreement.
While Good Robot is planning to sell its products directly to Ontario consumers, Counsil doesn’t expect it will lead to a big jump in sales without spending a lot on marketing to increase the company’s brand awareness.
“The craft buyer cares about local for many reasons, dollars staying in the province, freshness and supporting their community and so on and so forth, so if you’re suddenly a craft brand from outside of the province, then you’re not coming with those advantages,” said Counsil.
He said that with so many good lagers and IPAs in the Ontario market, Nova Scotia breweries will need to have products that stand out from the competition. He pointed to a Mexican lager brewed with lime and jalapeno that Good Robot sells as being something that’s novel.
“The product needs to have some meaningful strategic differentiation behind it in order to stand out or it needs to have a large advertising budget in order to compete,” said Counsil.
Andrew Tanner, president of the Craft Brewers Association of Nova Scotia and the co-founder of Saltbox Brewing in Mahone Bay, N.S., said the reality is some breweries were already shipping their beer to consumers in Ontario (and other provinces).
“Technically, I guess it is illegal, but we all know it’s been happening where a brewery might get an order from an Ontario person and we package it up and go to the local post office and drop it there and ship it to them,” he said.
As of late last month, 24 Ontario alcohol producers — 12 wineries, nine breweries and three distilleries — were approved to sell directly to Nova Scotia consumers.
Ontario’s Ministry of Finance said 16 Nova Scotia alcohol producers had applied for authorization, but did not specify further. Saltbox is one of the companies doing this.
Tanner said prior to the announcement of the Ontario sales agreement, Nova Scotia’s craft brewers’ association had raised specific issues with the finance department that it sees as more of a priority.
This includes the markup rate breweries pay to the NSLC based on their production amounts, as well as the tax breweries pay to the NSLC even for products that aren’t sold at the NSLC, both of which are long-standing issues.
Tanner said he believes there may have been a belief in government that the agreement would help more Nova Scotia breweries get their products on sale at LCBO locations in Ontario.
“The LCBO doesn’t have any space on their shelves [for Nova Scotia beer], just like the NSLC in Nova Scotia doesn’t have any space on their shelves for Ontario beer,” he said.
Steve (Bebo) Pilotto, the co-founder of Third Moon Brewing in Milton, Ont., is more bullish on the agreement than Counsil and Tanner.
“There’s a lot of beer fans who want beer from different parts of the country and they can’t get it,” he said.
“There’s a lot of breweries that want to get their beer out to the people in our own country who want our beer, so this seems like the easiest thing that provinces could do to help support interprovincial trade, the Canadian economy as a whole.”
Pilotto said the company got a “nice wave of orders” from Nova Scotians following the launch.
He said Third Moon already exports to Europe, and that it’s easier to send beer there than to other Canadian provinces.
“And it’s ironic that Canada, even being so much smaller in terms of population than the EU, we have, like, these 10 individual zones where it’s so difficult for small business to navigate that,” said Pilotto.
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