The LCBO has decided to stop providing plastic bags to their customers once their current supply runs out. Instead the store will sell you a re-usable cloth bag. LCBO customers will have to either bring their own plastic bags or buy the re-usable paper bags. Liquor bottles sold at the LCBO are placed in a single bottle paper bag and then placed inside a larger plastic bag. The LCBO will still provide the single bottle paper bags.

Reduction of plastic bag waste is an environmentally sound policy. However what is not widely reported that eliminating plastic bags will lead to increased profits for the LCBO.

The standard thin grocery shopping bag costs 1 cent for the retailer. Since the LCBO plastic bags are thicker they should cost 2 cents, if not more. A standard grocery paper bag costs 4 cents per bag. The LCBO paper bags are much smaller and should should cost 1 cent per bag.

If a customer was to purchase two bottles of wine from the LCBO it would be packaged in 2 paper bags and 1 plastic bag at the checkout counter. A cost of 4 cents in bags. Eliminating the plastic bag will save the LCBO 2 cents on every sale.

The LCBO used 80 million plastic bags last year. Eliminating the plastic bags will save save the provincial corporation at least $1.6 million.

LCBO Facts 2007

  • 60% market share of alcohol sales (The Beer Store is privately owned)
  • Government legislated monopoly on liquor sales in Ontario
  • Owned by the Government of Ontario
  • $4.1 Billion in sales
  • $1.345 Billion in profit not including taxes generated for the Government of Ontario
  • 5.5% (up $213 million) increase in profits
  • 6.1% (up $78 million to $1.37 billion) increase in revenue
  • 5.1% (up $65.3 million) increase in dividends
  • 14th straight year LCBO has increased its dividend
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