Sunday, September 27, 2009

Finally, here's a labour cause that every right thinking, patriotic Canadian should be able to get behind. Beer, of course, real beer that is as opposed to the dilute urine sold south of the border, is definitely one of the things that define this country. Retired Molson workers in Newfoundland are protesting a claw back of one of their retirement benefits on the part of the company. The clawback involves the company saying that it will no longer supply its retirees with the traditional 6 twelve packs of beer per month. See the end of this post for further Molly comments on this matter. For now all that I can say is that any Canadian who doesn't recognize this for the atrocity that it is should be hung by a lamp post at dawn for the crime of treason. The story from the CBC...
N.L beer protest still brewing
CBC News
Retired brewery workers gathered outside a Molson plant in St. John's for the second time this year to protest the company’s plans to cut back the amount of beer pensioners receive every month.

Right now, retired workers get six dozen beer per month from the company but Molson plans to reduce that to one dozen beer per month, as of Jan. 1, 2010.

The company says it will drop the allocation altogether in five years.

This is the second time retirees have protested the change. They also protested last June when Molson retirees across the country received a letter from their former employer outlining the planned changes.

The letter says the changes are necessary because of "competitive pressure and the current economy" which have forced the company to "monitor costs and look for innovative ways to control and reduce them."

At the time, the pensioners union representative spoke out against the new policy.

"There's been no consultation with the members, and they've taken beer from them, which is a taxable benefit," said Greg Pretty of the FFAW/CAW, which represents approximately 45 Molson retirees in St. John's.

"The people who brought this company to where it is today … are now being discriminated against based on their age," he said.

There are about 50 retired Molson workers in the province.

A Molson representative told CBC that supplying 2,400 retirees across the country with free beer was costing the company over $1 million a year.
The whole idea that Molson's is "suffering" under the present "economic conditions" is, of course, absurd. If there is one business that is recession proof it is booze. Check it out yourself if you don't believe me. Glance up to the photo that accompanies this article. Note the sign about the Montréal Canadiens. Molson is "suffering" so much that they were only able to clinch a deal to repurchase the Habs earlier this year for a paltry $500,000,000. That's half a billion dollars. I wish I could suffer so badly.

But there's another indication of the degree of Molson's suffering beneath the surface of what the above article says. Here comes your math test kiddies. Let's assume the round numbers supplied in the above of 2,400 Molson pensioners and about 1 million in expenses to be about right. If this is true then the cost to Molson's of the 12 pack that they supply to the retirees is about $5.78. the cost of a Molson's 12 pack to the general public varies across Canadian provinces, from a high of up to $24.95 in some outlets in Alberta (where privatization was supposed to work its magic via competition and reduce prices) to a low of $19.25 here in Manitoba. As I wish to be kind and generous to the poor suffering, ill fed managers of the Molson Corporation I will take the price here in Manitoba, the lowest in the country, for the following calculations. Here in Manitoba the Manitoba Liquor Control Commission (MLCC) applies the following markups to domestic beer: $0.122 per liter and 75%. With good old high school algebra this works out to a buying price of $10.71 paid to Molson's. Before you get too frothy and libertarian about the evil government monopoly consider that 75% is less than the 85% profit margin that Molson's makes from selling its beer at the lowest price in Canada. Also note that in places such as Alberta where the sacred god of competition rules that prices are higher and that the profit margin is also higher.
Now there are a great many businesses who would think they had died and gone to heaven if their profit margin was 85%, let alone if they were able to swing a half billion dollar corporate acquisition. So think of the guys in Newfoundland the next time you choose what beer to buy.


Mr. Beer N. Hockey said...

This is the sort of crap we deserve for allowing bloody accountants to run the world.

Anonymous said...

Just a minor note wrt to the "watered piss beer south of the border." I've lived in the BC lower mainland, Pittsburgh, and California Bay Area and I have to say the selection of quality beer brewed by craft and micro breweries south of the border blows BC beer clean out of the water.

All the big macro breweries make light tasteless beers and having tasted them on both sides of the border I cannot honestly tell the difference.

What I can say is the small scale brewery scene in the parts of the States I've been is orders of magnitude more vibrant than anything I've seen in Canada.