Charge us more, LCBO asked French supplier

by Patrick Cain

Ever since the Ontario Auditor-General reported on the LCBO’s formula-based purchasing practices, criticizing a system that can result in one of the world’s largest alcohol buyers asking its suppliers to charge it more (the LCBO sets a target retail price for an item, which involves a fixed markup from the wholesale price; if the quoted price is too low, buyers can and do get the wholesale price raised to conform to the formula).

This seemed like an opportunity to test a theory I’ve had for a while that there are a number of public institutions in Ontario that have an underexploited, wide-open potential for data journalism, and that the LCBO is one of them.

I ended up filing two FOI requests with the LCBO. The first was aimed at trying to find out how much money had been left on the table in total through these wholesale price hikes. The response to this request didn’t yield any useful numbers, but did contain a list of purchases where the LCBO had asked for wholesale prices to be raised.

I switched strategies and asked for records of one transaction to see how it actually worked. The story is here.Basically, it explains how the LCBO asked for a price hike on a shipment of 180 cases of calvados intended for the Christmas market, rejecting a bid of $27,481 and asking to pay $31,351 instead to make the formula come out right. The documents are embedded in DocumentCloud at the bottom of the story.

Here’s how it looked on TV.

The story was in some ways ideal for AM radio (see September 19).

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About Leslie Young

A budding data and database geek, I try to turn numbers into stories. I've been with Global News since the spring of 2011. Find me on Twitter @leslieyoung
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