Ontario Small Distiller Direct-to-Store Delivery Program Information for Distilleries

Program Overview

The Ontario Small Distiller Direct-to-Store Delivery Program allows small Ontario distilleries to direct deliver approved, locally produced spirits and liqueurs to select LCBO stores.

The program’s objectives are as follows:

  • Provide a platform for small distillers to offer their products for sale via the LCBO retail network.
  • Augment the LCBO’s Spirits assortment with market-relevant, locally produced products.
  • Eligibility 
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  • This program is open to small, licensed manufacturers of spirits and contract distillers in Ontario that meet the following criteria:
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The distiller must own a working still and be licensed to manufacture spirits

The distillery must produce less than 75,000 litres globally of saleable product annually. 

Eligible products must be made from start to finish by the distiller and at the distillery.

Greater than 50% of raw materials must be fermented on-site per product. Contract Distillers

Contract distillers must hold an AGCO Manufacturer’s Licence.

Contract distiller products must be distilled at an Ontario distillery adhering to all of the above mentioned criteria.

Any spirits produced by an Ontario distillery for a contract distiller is included in that distillery’s production for the purpose of determining total annual production under this policy.

 

Program Terms

1. Only one SKU per product category will be considered until the SKU is exceeding the sales target. For example, you cannot list a second vodka SKU until the first vodka SKU is making or exceeding the target. (See sales expectations below.)

2. Products accepted for the program are authorized for Direct-to-Store Delivery only. A product cannot participate in the direct delivery program and be available for stores to draw from our warehouses at the same time.

3. Products will be listed and delisted at the discretion of each LCBO store.

4. All products must undergo a Quality Assurance review for packaging and liquid on an annual basis. Once the product is in-market, any changes to packaging or liquid require a new Quality Assurance review and must be brought to the attention of the Category Team.

5. All participating products must be line priced with the distillery’s on-site store.

6. Category reserves the right to decline products.

7. Category reserves the right to move a product to a different listing type if the product offering is deemed appropriate.

8. Distillers who wish to supply product directly to licensees or duty free, must contact LCBO Corporate Affairs: distillery.policy@lcbo.com.

 

Sales Expectation

  • All products on the Ontario Small Distiller Direct-to-Store Delivery Program will be held to the following target: Average sales to exceed $2000/store by the end of Year One.
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  • Products not meeting this quota will be eligible to be delisted. 
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  • Performance Review
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  • Sales by store will be formally reviewed semi-annually.
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  • Products not meeting the quota will be notified with a warning letter. If they continue to fall below the quota, they will be eligible to be delisted.

 

The sales target of $2000/store will remain in place regardless of the number of stores to which products are direct delivered. However, Ontario Small Distillers are encouraged to engage with an array of stores in their vicinity and to contact LCBO Category Management staff to address any questions about quota.

Products participating in the Ontario Small Distiller Direct-to-Store Delivery Program will not be considered for LCBO Portfolio until they have demonstrated a minimum of 1-year of exceptional performance on the Ontario Small Distillers program. At that time, the Category Team will assess if the product is a reasonable candidate to move to an LCBO General List. You may find more information on LCBO Portfolio here.

 

Performance Advice to Small Distillers:

Most successful SKUs have investment behind them, both through in-store support programs (e.g., LTO, VA, Tastings) and external promotion. To be considered for paid support programs, please apply in the Merchandising Promotion Tracking Sysytem (MPTS) by the deadlines outlined on the Trade Website under Promotional Calendar.

It is important to understand that our Retail stores may delist underperforming SKUs at their discretion. It is essential to build relationships at the Retail level.  As distribution expands, it may be beneficial to consider hiring an agent to represent your SKUs.. Information and a list of agents are available at http://www.drinksontario.com/

Listing Process Ontario Small Distiller Direct-to-Store Delivery Program issues product calls three times a year. Producers may submit products for consideration into the program via these three calls. 

All new item submissions must be entered into NISS via a Product Call.

NISS link 

 

Key Dates

Pre-submission Due Date – The final date on which the NISS Submission can be made into the call.

LCBO Callback Date – The date which Category Accepts or Declines products for tasting and review are communicated (via NISS).

Sample Due Date – The date which the sample is due for tasting (final liquid sample needed).

Scheduled Tasting Date - The date all products in the call are tasted and reviewed by Category. Once a submission is accepted:

Once a product has been tasted and reviewed by Category, you will receive notification of the results via NISS email. If your submission is accepted, you will be prompted to submit a sample for initial chemical analysis.

Once the item has passed initial LAB analysis, you will receive an NTP (Notice to Purchase) via NISS email, you must provide the following by the stated deadline: Provide through NISS (Upload in NTP): a. A quote on Supplier letterhead indicating cost per case and retail price per bottle. Please contact Pricing Administration for any questions related to calculating retail price points.

 Spirits Pricing Calculator

 

Next Steps:

Upload a file with a picture of the label in to the NISS system for Label Examination. c.

Confirm UPC and SCC Codes through the NISS system.

Provide to the Category Team: a. A finished product sample for visual inspection of the label, (final packaging), along with any previous certificates of Supplier analysis within one year.

Once the item has passed final label inspection, the pricing quote will be submitted to the Pricing team to verify it is correct. If any changes are needed to hit your desired retail price, the Category team will request an updated quote.

At the same time, the Category Team will request from the Supplier two cocktail recipes, brand info and tasting notes which will be included in the product circular (a one page document communicating the product to retail).

When the product is priced, we will send out the product circular notifying all stores the product is available at which point you are free to start soliciting stores.

It is advised that the stores be largely concentrated in the vicinity of the distillery and to start small and ladder up.

Please note that approval to participate in the program allows the distillery to approach the desired stores for listing – it does not obligate the store to list the product. The final listing decision is at the discretion of each individual Store Manager.

When a store has agreed to list a product, the distiller and Store Manager are responsible for determining an initial inventory forecast and replenishment process/timeline.

The Category Administrator will provide the distillery with a Distributor code that stores will require for receiving inventory. The Distributor Code will also be included in the product circular.

A small distiller wishing to have its product made available for sale via our e-commerce website should contact Aleksandra Novakovic (aleksandra.novakovic@lcbo.com) through store 974, LCBO Ecommerce Warehouse.

They should ensure a consistent supply of inventory is delivered. 

 

Click Here for Forms

Quality Assurance

The Supplier is responsible for the quality and safety of the product it produces and ensuring compliance with all Regulatory and LCBO consumer unit and shipping container packaging and labelling requirements, including tamper-evident and barcoding requirements established by the Canadian Association of Liquor Jurisdictions (CALJ).

Refer to LCBO's Product Packaging Standards and the CALJ Product Identification Standards for the Distribution of Beverage Alcohol documents for information pertaining to these requirements.

All products must undergo a Quality Assurance review at a minimum on an annual basis. Product chemical composition and labelling must meet all applicable regulatory requirements including all LCBO Product Packaging Standards and Guidelines for Chemical analysis as published from time to time. Once the product is in-market, any changes to labelling, packaging or product composition will require a new Quality Assurance review and must be brought to the attention of the Category Team. Quality and compliance must be maintained consistently from Lot to Lot while the product is in the market.

The supplier is responsible for maintaining thorough production and quality records to support a product quality investigation. The supplier will be required to produce records of shipments to LCBO stores for traceability of distribution by Lot in the event of a product quality investigation that may lead to a recall.

A product that is determined to be unsatisfactory in the market, will be treated as is outlined in the LCBO Purchase Order Terms and Conditions.

Payment Info

The LCBO has a pay on receipt program which means you do not need to invoice the LCBO for products that are delivered to the store as part of the Ontario Small Distiller Direct-to-Store Delivery Program. Please follow the steps outlined below: 

Stores will place orders for product

Suppliers will ship products directly to stores 

Suppliers will obtain signed proof of delivery from each LCBO store 

Stores will record product receipt(s) 

The product receipts will generate invoices in Accounts Payable for payment. Pricing, HST, and any other cost component, if applicable, will be automatically generated by how the SKU is databased 

Suppliers will continue to receive email payment notifications and can get more details on shipments via iSupplier

LCBO will remit a rebate to small distillers proportional to the volume they deliver direct to LCBO stores. The rebate rate is set at $0.1567 per litre. Payment for the rebate will be included in the same payment as the product that was received by LCBO stores.

Suppliers must provide on all packing slips/bill of ladings to the LCBO stores the following: 

SKU number

The number of selling units being shipped 

The number of cases being shipped

LCBO store number and address

Shipment date

Packing slip/bill of lading must be signed by an LCBO employee as proof of delivery in the event of any discrepancies Pricing Suppliers are paid for products delivered directly to LCBO stores based on the active quote at the time of delivery. Please note that the case cost is not adjusted when a product is on an approved Limited Time Offer (LTO). The cost of reducing the price is billed back to the supplier in the period following the LTO.

For all active SKU’s, suppliers will be paid based on the cost per case that is active at the time of receival at the LCBO store. For corporately delisted SKU’s, the most recent historical cost per case will be used. Suppliers will be notified in advance if an ongoing product is being delisted by the Category Management team. Furthermore, for a seasonal product, the time frame during which the SKU will be active for shipping will be given in the Notice to Purchase (NTP).

The LCBO will not pay for inventory delivered to stores once the SKU is no longer in the LCBO system as this inactivates all costing information. It is the responsibility of the supplier to know the status of a given SKU prior to shipment.

Direct Delivery to Licensed Establishments Ontario distilleries can deliver spirits directly to licensed establishments in Ontario, on behalf of the LCBO, through LCBO’s Direct Delivery to Licensees Program:

https://www.doingbusinesswithlcbo.com/content/dbwl/en/basepage/home/new-supplier-agent/DirectDelivery.html

For more information about the LCBO’s Ontario Small Distiller Direct-to-Store Delivery Program, please contact:

Sean Adams, Product Advisor, Local sean.adams@lcbo.com

White Spirits Category Team (Vodka, Gin, Rum, Soju, RTD)

Category Manager White Spirits & RTD: Ann Patel – ann.patel@lcbo.com
Product Manager White Spirits: Christina Bellotti-Ramzan - christina.bellotti-ramzan@lcbo.com
Category Administrator: Angela Van - angela.van@lcbo.com

Brown Spirits Category Team (Whisky, Liqueurs, Tequila, Brandy)

Category Manager Brown Spirits: Peter Cloutier – peter.cloutier@lcbo.com
Product Manager Whisky: Emily Liao – emily.liao@lcbo.com
Product Manager Liqueurs, Tequila, Brandy/Cognac: Mike Hodgson – mike.hodgson@lcbo.com
Category Administrator: Tania Hofweller – tania.hofweller@lcbo.com 

Pricing Administration: pricing@lcbo.com

LCBO Quality Assurance Department: quality.assurance@lcbo.com

Corporate Affairs: distillery.policy@lcbo.com

Important Links and Resources

TPAR – Trading Partner Access Request (includes access to NISS) 

*Please note the FAQ link on completing this access form.

iSupplier

You may also visit www.doingbusinesswithlcbo.com for more information regarding the LCBO’s programs, strategies, updates and key contacts.

Labels and Packaging

Canadian Labelling Laws: https://inspection.canada.ca/food-label-requirements/labelling/industry/eng/1383607266489/1383607344939

 

 

 

Program Guide 2021

Ontario Small Distillers Direct to LCBO Delivery