LCBO to introduce 'craft beer zones' at 25 locations

The Summerhill LCBO has unveiled the province's first specialized craft beer section. Ontario says the move will increase exposure for Ontario's small and craft brewers.

Craft beer generated $68 million in sales last year

70 Ontario craft brewers sell beer through the LCBO (CBC)

The LCBO has opened its first "Craft Beer Zone" at Toronto's Summerhill store — the first of 25 planned for the province.

In a statement, the province described the sections as "innovative new marketing displays" which will highlight Ontario, Canadian and international varieties of small-batch beer.  It says the zones will provide increased market exposure for the brewers.

The Summerhill Craft Beer Zone also features the LCBO's first growler station, where consumers can fill large, reusable jugs with freshly poured beer. There will be three Ontario craft beers on tap at the station.

"The Craft Beer Zones and the Summerhill growler station will provide greater choice for Ontarians while supporting growth for brewers," said Ontario's minister of finance Charles Sousa.

"It's a pretty cool first step," said Mark Murphy of Toronto's Left Field Brewery, which sells through the LCBO but is not yet participating in the growler program.

"It helps grow the channel, so everyone benefits," Murphy added. "We'll see more consumers being exposed to craft beer and hopefully coming to our door."

Small batches, big business

In total, the LCBO sells 70 brands of Ontario craft beer. It says the microbrew suds topped $68 million in sales in 2014-15, a 36 per cent jump over the previous year. Since 2006, sales have grown by 630 per cent.

Ontario brewers say the new sections could bump sales even higher.

"This is yet another opportunity for craft brewers to expand our market reach and grow our businesses," said Cam Heaps, chair of Ontario Craft Brewers, an association of provincial brewers.

The Craft Beer Zones are part of a larger beer plan introduced by Ontario earlier this year.

In April, the province announced it would allow the sale of beer in up to 450 grocery stores, introduce reforms at The Beer Store's board of governors, and provide greater support for Ontario's craft brewers.

Mark Murphy says the changes, as well as improved tax credits, have made it a good time to be in the business of craft brewing.

"It's been a pretty supportive industry and everyone is liking craft beer these days," he said. "Competing is a lot easier than it used to be."

Restaurants left out to dry

Restaurants Canada says growler sales should have been introduced in restaurants instead of LCBO locations.

Earlier this year, the national association proposed to Ontario that growler sales be permitted as an "off-sale" in restaurants. The proposal has been shelved.

"Restaurants Canada asked the government to follow the lead of other provinces and allow restaurants to sell growlers for customers to take home," said James Rilett, Restaurants Canada's Ontario vice president. "The government said no, and then turned around and took the idea for themselves."

"They have chosen to directly compete with restaurants and bars for the draft beer market," Rilett added.

Five provinces currently allow craft beer off-sales at restaurants.