Waterloo Brewing Investment Highlights
6 Advantaged Regulatory Framework for Craft Beer Sales in Ontario
The regulatory environment in Ontario provides a competitive advantage to Waterloo due to the
favourable treatment of craft brewers and de facto government backing of accounts receivable
Introduction of the Grocery Channel has
Provided Greater Access to Waterloo's
Products
In 2015, Ontario legalized beer sales in
grocery stores, greatly expanding the
number of retail outlets selling Waterloo's
products
The grocery channel is expected to grow
from ~200 stores in 2017 to -450 by
December 2018; has the potential to
become Waterloo's largest channel
Perfect Price Transparency Reduces Price
Competition and Promotes Competition
Based on Quality and Value
Ontario beer market offers brewers perfect
price transparency, with pricing across all
brewers published each Monday morning
The resulting price uniformity has elevated
quality as a key differentiator, which plays
to Waterloo's strengths
Grocery
Channel
Expansion
Accounts
Receivable
Price
Transparency
16
Government Regulation of Beer Distribution
Creates a Beneficial Accounts Receivable
Dynamic
The Liquor Control Board of Ontario
("LCBO") is an Ontario government
enterprise that regulates the alcohol market
in Ontario
Accounts receivable from the sale of beer
are paid to Waterloo in 10 days, benefiting
Waterloo's cash and working capital
position
Nearly 100% of Accounts Receivable are
collectible annually and bad debts are
almost eliminated
Protected
Shelf Space
Craft Brewers Are Guaranteed Shelf Space
In Ontario, craft brewers are guaranteed a
minimum of 20% of shelf space at The
Beer Store ("TBS")
In addition, craft brewers are entitled to
offer two products at TBS without a
stocking fee; Waterloo grandfathered into
craft brewer status
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