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Kelowna News

B.C. craft distilleries say their industry could dwarf the wine sector if they had the same support

Craft distilleries seek change

B.C. craft distillers are calling on the provincial government to put their proposed emergency powers to good use by helping get more local products onto BC Liquor Store shelves.

With the provincial government pulling U.S. booze there is a big opportunity for local producers to fill the void, according to Tyler Dyck, CEO of Okanagan Spirits and president of both the Craft Distillers Guild of BC and Canadian Craft Distillers Alliance.

“British Columbians are demanding it right now. B.C. wants value-added, made in B.C. products that power B.C.’s economy,” Dyck said.

The industry is urging the province to support craft distilleries in the same way B.C. does through the VQA program.

Dyck says right now, if he sells a $40 bottle of spirits at the BC Liquor Store he only gets about $13 back, something economically feasible for only the giant multinational brands.

For comparison, a B.C. winery selling a $40 bottle of VQA wine through a BC Liquor Store will get back about $33.

“It allows them to grow their business, to celebrate B.C., and to grow into the amazing economic driver for B.C. that they have become,” Dyck says.

He says B.C. craft distilleries simply cannot afford to put their products in BC Liquor Stores. Those that do, are doing so at a loss to build brand awareness.

The vast majority of hard liquor sold in B.C. is sold at government-run stores.

“You really need to be there to be relevant,” Dyck said.

Craft distillers in B.C. use products from B.C. farmers, Dyck says, just like wineries do. “If you have a program in place that's supposed to celebrate B.C., to reward people for using B.C. agriculture, it should not be restricted to only grapes.”

In addition to lessening the province’s cut from every bottle sold, Dyck would like to see an aisle in all BC Liquor Stores dedicated to craft B.C. spirits that use B.C. agricultural products.

“Right now, you have empty shelves, and they have signs on those shelves saying, ‘go support Canada,” Dyck said. “Well, here's the big thing, Canadian Club, Crown Royal — they're not Canadian.”

Both brands, while bottled in Canada, are owned by multinationals.

And while Canadians are involved in the manufacture of the big brands still on the shelves, a company that pays tax in B.C. and employs British Columbians should be supported over the giants, said Dyck.

Direct-to-consumer sales at his distillery are skyrocketing. “But if you go into a government liquor store, you see zero presence of that,” he said.

Dyck says if the province can take a smaller cut on each bottle of craft B.C. liquor, they will make more down the road.

“Right now you're making 100% of nothing… because, B.C. craft distillers can't afford to be there,” he said, explaining that if craft distilleries could get the same deal as wineries the craft spirits industry would “dwarf” the wine sector.

"They could be in every part of the province.”

The industry is also calling on the provincial government to overhaul other policies, such as arbitrary production limits that penalize growth and interprovincial trade barriers.

“Up to what, let's say, two months ago was easier to ship into and deal with the U.S. than the rest of the provinces,” said Mark Spurgeon, owner of Urban Distilleries in Kelowna. “It's ludicrous.”

Dyck met with Solicitor General Garry Begg this week to make the case and is optimistic that things could change.

“I think he's very pragmatic. He seems no nonsense,” he said. “I'm hoping that we're going to see this. I'm cautiously optimistic.”

The BC NDP has proposed legislation that will give cabinet sweeping powers to respond to the U.S.-Canada trade war and Dyck says liquor policy would be a good place to start.

In a news release, the Kelowna Chamber of Commerce says it has also picked up the cause and recently wrote a letter to Begg, asking for a "review the drag on business that current liquor board regulations put on small distilleries in B.C."



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