For the last year, I’ve provided updates about the disruption facing the alcohol beverage industry as a result of global supply chain challenges. As industry partners, you are likely aware that these issues continue today, and are expected to continue into next year.
Global supply chain challenges continue to be largely driven by raw material and labour shortages, and port congestion and disruption—all of which are rapidly driving up the cost of doing business. In fact, supply chain costs are at unprecedented levels amid skyrocketing raw material and transportation costs. This is a contributing factor to Canada’s inflation rate which is at a 40-year high.
As you are aware, every quarter our import-related transportation costs are adjusted in response to market fluctuations throughout the year. The next adjustment will be made on July 8, 2022, and suppliers may notice an increase in response to some of these trends.
In terms of LCBO’s fill rates, the availability of certain products may fluctuate, but the LCBO continues to have a great selection of both local and international products in-store and online for customers to explore. Shortages are more prevalent in some categories, including premium champagne, tequila and premium scotch.
While we want customers to find what they are looking for, if a particular product is unavailable, we are encouraging customers to explore and discover new brands, check availability online before visiting a store, and talk to our knowledgeable employees to find alternatives.
As we have done throughout the pandemic, we will continue to work with our supply chain partners and suppliers to adjust our plans according to changes in market conditions. We ask that you play your part by keeping the lines of communication open, informing us early of any challenges, and working with us to develop solutions.
Thank you for your ongoing partnership and support as we work together to ensure that Ontarians find the perfect product this summer.
- Nick Nanos
- Chief Supply Chain Officer, LCBO