LCBO Monopoly - good article

[Belgian]

Some interesting & thoughtful commentary. In case you've not yet read it.

Cheers,
JK

[icemachine]

Good article - shame the font is so hard to read online

[Belgian]

Good article - shame the font is so hard to read online

Seems to be a scan of the pages. I found that to print it out, you need to command-click to save it to disk, and then it is easier on the eyes.

Maybe creating a PDF this way (in the print dialog window) will also be more readable?

[Torontoblue]

You could have warned us that there is a whole page missing. Just read the first 2 pages, go to page 3 and the follow on doesn't make sense. Seems Page 3 (or 22 of the magazine) is missing.

[Bytowner]

I couldn't read the whole article (half the pages are cut off for me, tried in both explorer and chrome), dunno why Ottawa Life hasn't figured out the intertubes yet, seems like an important skill in today's publishing industry.

Anywhoo, as for the article itself, not impressed. One-sided and full of some of the poorer arguments I've heard on the anti-LCBO side. The bitching about the $6 million dollar bonuses is especially stupid and petty.

[icemachine]

I think that pointing out that bonus levels have risen at triple the rate of profits is indeed worth pointing, considering that the taxpayers are shareholders in this corporation, executive pay levels should be scrutinized more.

Same as pointing out that while its nice we have pretty looking stores, its not really in the LCBO's mandate to have culinary courses. (I wonder though what the reaction would be if they used double wides as stores in the GTA the way they do up north?)

[Bytowner]

You're making two very strange assumptions:
1) The bonus level was right 10 years ago
2) The bonus level should rise at exactly the same rate as profit

I'm not sure what reason anyone would have to believe either of those, especially considering the amount of corruption documented 10 years ago in this very article. And none of this even touches the fact that $6 million is a pittance when we're talking about executive compensation for an organization as large as the LCBO.

I always find it odd how everyone expects so much more from public servants but for so much less pay.

[icemachine]

I don't know why the LCBO should even be paying bonuses. The base salary should be appropriately designed, but what does the executive level of a Crown corp who's mandate is "social responsibility" do to deserve a bonus? Profits are up, but so is the minimum price they set it at. Is that really smart management or is it just the worlds biggest captive market for alcohol sales?

Personally half the problem as I see it is the fact that we have public servants selling us alcohol.

[Bytowner]

Because you don't attract top talent without top benefits. It's not complicated. Despite the author's stupid notion that a "hamster in a cage" could run a $4 billion dollar business with 4000 employees, providing an acceptable level of service to 10,000,000 customers, you do need top-notch executives to run a business this size.

If you want to attack the LCBO on an ideological basis and a dislike for public servants, do that, but leave it there, don't pretend to be interested in the facts on the ground.

[SteelbackGuy]

I've always laughed at the notion that " a monkey could do it". If that were the case, monkeys would be doing it, believe me. Of course, only a fool would state such a notion, but I do hear it from time to time.

[icemachine]

Because you don't attract top talent without top benefits. It's not complicated. Despite the author's stupid notion that a "hamster in a cage" could run a $4 billion dollar business with 4000 employees, providing an acceptable level of service to 10,000,000 customers, you do need top-notch executives to run a business this size.

If you want to attack the LCBO on an ideological basis and a dislike for public servants, do that, but leave it there, don't pretend to be interested in the facts on the ground.

Hey I've got respect for public servants who actually serve the public, but the LCBO does not provide a service the Government needs to be delivering. Public Health doesn't sell us cigarettes, they just regulate the sales. Thats where the LCBO's mandate should end.

The LCBO erects big box style stores worth millions, when the same service could be provided out of a condo unit in a strip mall (or a mobile trailer or even a general store as rural Ontarians know), are the taxpayers (shareholders) of the LCBO getting good value?

As I said in my previous post, which you seemed to ignore quite well, a base salary at the appropiate level is deserved, but bonus with no good justification are not.

[JerCraigs]

I don't know why the LCBO should even be paying bonuses. The base salary should be appropriately designed, but what does the executive level of a Crown corp who's mandate is "social responsibility" do to deserve a bonus?

I was initially inclined to agree with you but what is not stated in the article is the criteria for the bonuses. What if the bonus was "For every dollar you save us you get 25 cents?" or something similar? That I can get behind. "We sold $XB worth of booze so you get a bonus!" less so.

The bits about LCBO funded apartments is a similar story. That they exist is not in itself damning. Many organizations, including government, cover living expenses in certain circumstances. The real question is WHY this was happening and if it was legit. If its not the guy should have to pay it back.

To me, the industry sponsored boondoggles are more incriminating, but on the other hand I'd rather industry pay for it than the taxpayer...

I thought the points about the expensive nature of the LCBO stores and the competition for advertising were actually more interesting points. I would personally be quite happy picking up my purchases at a frugal looking Costco-like warehouse. Perhaps there is a middle ground somewhere?

[Bytowner]

I thought the points about the expensive nature of the LCBO stores and the competition for advertising were actually more interesting points. I would personally be quite happy picking up my purchases at a frugal looking Costco-like warehouse. Perhaps there is a middle ground somewhere?

To me this argument is still problematic. Why aren't public assets allowed to provide quality service? The numbers would seem to suggest that we're getting pretty good value for our money. An ROI of, what, 40%? An increase in profit of the same amount over the past 15 years or so?

That said, the most important question is whether the government would make more off of taxes and licensing fees under a different system. That's a good debate to have.

I'm not swayed by arguments that say LCBO stores are too nice. I don't think anyone wants to suggest that we go back to the LCBO of the 1970s. Are we really going to jump all over them for improving their service? By the way, where are these mysterious under-utilized LCBOs? The massive new LCBOs are in high-traffic areas and, in my experience, seem to always be busy. You're not going to convince that LCBO Orleans, Rideau or Westboro (the largest and newest ones in Ottawa that I'm aware of) are too big, and too nice.

[Bytowner]

As I said in my previous post, which you seemed to ignore quite well, a base salary at the appropiate level is deserved, but bonus with no good justification are not.

I wasn't ignoring it, I said that the public sector had to be competitive in the labour market. You might as well say, "why can't hedge fund managers just get an appropriate base salary?" It's all about the performance metrics.

[Kel Varnsen]

I'm not swayed by arguments that say LCBO stores are too nice. I don't think anyone wants to suggest that we go back to the LCBO of the 1970s. Are we really going to jump all over them for improving their service? By the way, where are these mysterious under-utilized LCBOs? The massive new LCBOs are in high-traffic areas and, in my experience, seem to always be busy. You're not going to convince that LCBO Orleans, Rideau or Westboro (the largest and newest ones in Ottawa that I'm aware of) are too big, and too nice.

Yea I don't really get the too nice comments either. I mean yes the LCBO has a monopoly on liquor sales in the province so I can kind of see how people would think they shouldn't need to advertise or do promotions or have nice stores. But the thing is that liquor isn't a necessity for anyone. So sure if there is a power company or water company that has a monopoly they don't need to advertise since you need water. But no one needs liquor so they are competing with everyone else for my disposable income. And because of that they in order to make profits they need to convince people to spend their money on bottles of liquor, and not movies or video games, or dinner at restaurants or drinks at bars. I know if I am shopping somewhere that is near a nice looking LCBO I will go in and look around and see what they have and if there is anything interesting on sale. If the stores were just dank warehouses, I probably wouldn’t do that nearly as often.

Also Bytowner, you should check out the LCBO in Barrhaven. It’s not as good as the Rideau store, but it is as good, if not better and bigger than the Westboro store.