TSX:LIQ.DB.B - Post by User
Post by
hollyberrieson Mar 19, 2014 6:31pm
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Post# 22343529
Partnership probability High
Partnership probability HighI think that it is more likely for eligible grocery franchises to partner with a successful liquor provider such as LIQ than to develop that expertise in house, especially as the model does not apply across Canada. This approach allows grocery franchises to take advantage of established supply chain economies of LIQ and reduce learning curve risk. LIQ would compete well in BC based on their existing market presence and I gather that is what management has in mind. The business structure similarities of a large scale market participant like LIQ would make negotiating with a large grocery chain easier I suspect. If they were to sublet in an existing store with gated entry to exclude minors, it would be possible to take advantage of an existing customer base, while avoiding the problems of long store lineups that would otherwise deter customers, so worth the trouble for LIQ to engage in these negotiations. I see upside the way the BC changes are structured.