The Liquor Control Board of Ontario (LCBO) is set to report its first annual profit drop in a decade, with projections indicating that the agency will contribute less than $2 billion to the provincial government in 2025. This decline has sparked discussions about the factors contributing to the decrease, including the expansion of alcohol sales to convenience and grocery stores. However, experts suggest that the situation is more complicated, involving regulatory changes, a decline in alcohol consumption, and management issues.

Despite holding a monopoly on liquor retail in Ontario, the LCBO has seen its annual dividend to the province decline over the years. Critics point to CEO George Soleas and board chair Carmine Nigro as responsible for the agency's struggles. They argue that instead of addressing the issues, the leadership has allowed the organization to manage its decline.

Supporters of the LCBO and Soleas attribute the drop in profits to government policies, particularly the wholesale pricing changes initiated during the COVID-19 pandemic. These changes have allowed bars and restaurants to purchase alcohol at discounted rates, which has now been extended to retailers. While this may have contributed to the decline, the overall drop in the LCBO's dividend—from $2.46 billion in the fiscal year 2022-23 to an estimated $1.85 billion this year—raises questions about management effectiveness.

The LCBO's per capita return to the province is notably lower than that of its counterparts in Quebec, Alberta, and British Columbia. In 2024, the LCBO's dividend was $159 per capita, compared to $161 in Quebec, $164 in Alberta, and $202 in British Columbia. This disparity is concerning, especially given that other provinces have lower prices for similar products, including Ontario-made whiskey.

For example, a bottle of Wisers Deluxe Canadian whiskey costs $32.95 at the LCBO, while it is priced at $31.25 in Quebec, $28.99 in Alberta, and $27.99 in British Columbia. Despite having a near monopoly, the LCBO's higher prices do not translate into better returns for the provincial government.

Calls for a significant overhaul of the LCBO's management have intensified, with some suggesting that Soleas should have been replaced long ago if held to private sector standards. Rumors about his potential exit have circulated for months, but no official changes have been made. Instead, the LCBO appears to be following government directives to adjust its pricing system, which may lead to higher costs for consumers rather than addressing the underlying management issues.

As the LCBO navigates these challenges, the need for a comprehensive review of its leadership and operational strategies has become increasingly urgent.