A visit to a Circle K location in Ontario highlights the chain’s heavy investment in beer, with cases stacked prominently on floors and shelves and substantial cooler space allocated to single-serve beer cans and bottles.
While beer continues to dominate alcohol sales at convenience stores, outperforming ready-to-drink beverages (RTDs) and wine, the latter has emerged as a surprisingly strong category for Circle K, a subsidiary of Alimentation Couche-Tard.
Speaking at the Ontario Craft Wine Conference & Trade Show in Niagara Falls on April 23, Lucas Babando, Circle K’s category manager for beer, RTDs, cider, and wine, expressed optimism about the company’s wine sales performance.
“I’m pleasantly surprised by wine’s share of our total alcohol sales,” Babando said, noting that wine sales spike significantly during holidays and seasonal weekends.
Babando participated in a panel discussion titled “Navigating Ontario’s New Retail Landscape,” joined by Jennifer Gordon, assistant general merchandise manager at Costco Wholesale, Giancarlo Trimarchi, president of Vince’s Market, Anne Kothawala, president and CEO of the Convenience Industry Council of Canada (CICC), and Sebastian Prins, director of government relations (Ontario) at the Retail Council of Canada.
At Circle K stores, wine is given prominent placement, with end-cap displays and dedicated “wine walls” in some locations. The chain places a strong emphasis on Canadian products, with a substantial offering of VQA (Vintners Quality Alliance) wines, adhering to Alcohol and Gaming Commission of Ontario (AGCO) regulations that mandate 40% of wine displays feature VQA producers, small wineries, or wines from small-producing countries.
During the panel, Kothawala shared findings from a recent CICC survey of its members, including Circle K. Respondents expressed frustration with the current Liquor Control Board of Ontario (LCBO) model, citing barriers to becoming destinations for product discovery and consumer trial in alcohol categories, a role they frequently fulfill in other retail sectors. The survey also identified a lack of channel-specific data as a major obstacle.
“We are all about innovation as a channel,” said Kothawala. “Think about a new chocolate bar or potato chip—we’re a hotbed for companies to test products. We would like the same opportunity with wine and other alcohol products.” She emphasized the need for greater collaboration with wineries to keep pace with market trends, such as the surging popularity of rosé.
However, Kothawala acknowledged the structural barriers posed by Ontario’s regulatory framework. “Unfortunately, there’s not a whole lot anyone in this room can do about that,” she said. “The current system is preventing some of that innovation.”
Kothawala also highlighted the challenge of limited market insights: “Beyond Nielsen reports, there is no real understanding of the alcohol category in convenience and grocery. Without that data, it’s difficult for our members to make informed decisions.”
At Costco, a focus on VQA wines has been a deliberate strategy. Gordon explained that, due to limited space, the retailer decided early on to list only VQA-certified products in its 41 Ontario stores to differentiate its offering from other grocers.
During the trade show, Costco met with more than 30 wineries in search of new and distinctive products to add to its assortment, aligning with its “treasure hunt” shopping experience that emphasizes exciting finds at competitive prices.
However, Gordon noted that bringing new wines to market under the LCBO model remains challenging. “It’s not easy,” she said, citing the time-consuming process required to list new wines. She encouraged wineries to explore ways to simplify distribution for both Costco and other retailers, pointing to seasonal product rotations as a significant opportunity.
“There’s great opportunity for all of us to test different items during different times of the year,” Gordon said.
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