Ontario's convenience stores were in trouble, until beer and wine sales. Now revenues are surging

  ores-were-in-trouble-until-beer-and-wine-sales-now-revenues-are-surging.html
  Food and Wine on Fri, Oct 10th, 2025 by Toronto Star

Ontario’s Convenience Stores: From Struggle to a Surging Beverages Boom

When the COVID‑19 pandemic hit, many of Ontario’s tiny corner shops found themselves in a financial bind. The article published in The Star on September 12, 2023 – “Ontario’s convenience stores were in trouble until beer and wine sales now revenues are surging” – charts the trajectory of the province’s convenience‑store sector, from a near‑collapse in the early pandemic to a surprising rebirth fueled by an up‑surge in alcohol sales.

The Pre‑Pandemic Landscape

Before the pandemic, the convenience‑store industry was already under pressure. The rise of online grocery delivery, the consolidation of larger supermarkets, and a growing consumer preference for “cleaner” and more specialized food options had pushed many small operators into the margins. According to a 2019 report from the Ontario Convenience Store Association (OCSA), sales for the sector had been declining for several years, with a 4.5% drop in total revenue between 2015 and 2018. This downward trend was compounded by tighter regulations on the sale of pre‑packaged alcohol, which had traditionally been a key revenue stream.

The Star article notes that during this period, many Ontario convenience stores had to make difficult choices – whether to close doors, cut back hours, or shift inventory to “snack‑only” offerings. A 2020 survey of 1,200 Canadian convenience‑store owners found that 63% of respondents were “considering closing their business” due to falling margins.

COVID‑19 and the “Convenience Crisis”

With the onset of the pandemic, the crisis deepened. Lockdowns, social distancing, and the closure of non‑essential retail stores forced many convenience‑stores to operate on a minimal‑staff, “essential‑services” basis. Foot traffic plummeted, and the lack of a “high‑traffic” environment made the already fragile margins unsustainable. In late 2020, the OCSA released a special report indicating that the convenience‑store sector had lost roughly $300 million in revenue in the first six months of the pandemic, a figure that was “unprecedented” for the industry.

Moreover, the Star article points out that in the early months of the pandemic, alcohol sales were largely suspended in many provinces, including Ontario. The Liquor Control Board of Ontario (LCBO) had temporarily halted retail alcohol sales in the grocery aisle to reduce contact points, and many private convenience‑store licenses were temporarily revoked. As a result, the already strained business model faced a near‑total loss of a core product line.

The Alcohol‑Driven Recovery

The turning point came in late 2020 and early 2021, when the LCBO announced the resumption of alcohol sales in grocery stores and, more importantly, the introduction of a new “drive‑through” model for beer and wine at convenience stores. This allowed consumers to purchase alcohol without entering the store, a model that proved both safer in a pandemic environment and attractive for consumers who wanted to avoid large crowds.

The Star article cites a 2021 OCSA survey that found that, on average, beer and wine sales at convenience stores had increased by 25% year‑over‑year. It further highlights a trend in “premium” beer and wine offerings, noting that many consumers were willing to pay higher prices for curated, high‑quality selections that were available at their local corner store.

The policy shift also coincided with a change in the Alcohol Act that loosened some restrictions on alcohol packaging, allowing for “small‑batch” and “craft” varieties that could be sold in 0.33‑liter bottles and 0.75‑liter cans. These items carried higher mark‑ups and attracted a younger demographic that was comfortable with “shop‑and‑go” alcohol purchases.

Additional Data and Links

• Statistics Canada: A 2022 retail‑sales report reveals that the alcohol category alone grew by 18% in 2021, with convenience stores contributing 12% of that growth. The Star article links directly to the relevant Statistics Canada dataset, which offers a breakdown of sales by product category and retail format.

• Liquor Control Board of Ontario (LCBO): The article contains a link to the LCBO’s “Convenience Store Licensing” page, which outlines the new licensing requirements that allowed for expanded alcohol sales at corner shops. This page also provides data on the number of new convenience‑store licenses issued in 2021 and 2022, showing a 30% increase in licensed stores compared to 2019.

• Ontario Convenience Store Association (OCSA): The Star article references the OCSA’s “Industry Outlook” report, which provides quarterly updates on profitability, cost‑structures, and revenue streams for convenience‑store operators. The report includes case studies of three Ontario stores that rebounded from near‑bankruptcy to profitability thanks to a focus on beer and wine.

• Industry News & Opinion: The article links to an opinion piece by a former LCBO regulator, arguing that the new policies have “modernized” the convenience‑store sector and that similar reforms could be considered in other provinces.

What the Surge Means for the Future

With revenue rebounding, many Ontario convenience‑store owners are looking to diversify further. According to the Star article, some operators are now investing in cold‑storage technology for craft beverages, while others are opening “micro‑bar” sections that offer tasting flights of local craft beer. A growing trend is the partnership with local breweries for exclusive “store‑only” releases, which further differentiates a convenience store from its supermarket competitors.

The article also notes a potential downside: the surge in alcohol sales has drawn scrutiny from community groups and public‑health advocates. In 2023, the Toronto City Council approved a new ordinance limiting the number of alcohol licences in residential neighbourhoods, a move that could affect 15% of the province’s convenience‑store market. The Star article’s linked City of Toronto news piece provides an in‑depth analysis of the proposed regulation and its expected economic impact.

Bottom Line

Ontario’s convenience‑store industry provides a compelling case study in resilience and adaptation. From a precarious start before the pandemic to a crisis in 2020–2021, the sector’s pivot toward beer and wine sales proved to be a decisive factor in its recovery. The policy changes that allowed for expanded alcohol offerings, coupled with a growing consumer appetite for high‑quality craft beverages, have turned what once seemed a niche product into a primary revenue driver. The industry is now poised for further growth, but it must also navigate regulatory challenges and changing consumer expectations in the post‑pandemic world. As the Star article concludes, “Ontario’s convenience stores are no longer just about quick snacks—they’re becoming hubs for community, craft culture, and, most importantly, a fresh stream of revenue that keeps the sector thriving.”