Presented by the VINTAGES TeamMay 25th, 2011

VINTAGES OVERVIEW

2010 -11 Year in ReviewTom Wilson

2011-12 Business Plan Overview & Key Initiatives

Kate Mallett-Thomas

New World Wines Category Plan Highlights Tamara Jakes

European Wines Category Plan HighlightsGreg Dunlop

VINTAGES AGENDA

VINTAGES AGENDA CONT.

Inventory Management Overview & Key Initiatives

Christine Botham

Events OverviewRose Holness

Licensee Program OverviewRobin Sirutis

From Pre-submission to SampleAllan Craik

Tom Wilson, Vice President, Vintages

VINTAGES YEAR IN REVIEW

VISION

Discover our Latest with Vintages

To provide our customers with the optimum assortment of fine wine and premium spirits with an intense quality focus at every price

point and at every customer touch point

MISSION

SALES & PURCHASING

EVENTSINVENTORY LICENSEESSYSTEM

IMPROVEMENTS(VINTAGES & MERCHANDISING)

MY DIRECT TEAM

Tom WilsonVice President, VINTAGES

Robin Sirutis Associate Manager, Licensee

Programs

Kate

Mallett ThomasDirector,

Sales & Purchasing

Rose HolnessAssociate Manager,

Events

Christine BothamInventory Manager

Shannon MuirAdministrative Coordinator

Amal GavrosSr. Business Analyst

$0M

$142M

$283M

$425M

05-06 06-07 07-08 08-09 09-10 10-11 11-12

$384M

$331M$326M$300M

$260M$219M

Vintages Net Sales - 6 Yr

Plan

8.6% 1.5%15.9% 18.7% 15.4% 15.3% 11.0%

% change to prior year

$425M

2010-11 Net Sales

$0M

$128M

$257M

$385M

$333M$349M$384M

$383.7M, 10.0% to Plan, 15.3% to Last Year

+$35MVARIANCE: 10.0% +$51M

VARIANCE: 15.3%

ACTUAL PLANLAST YEAR

P1 P2 P3 P4 P5 P6 P7 P8 P9 P10 P11 P12 P13

0%

15%

30%

Net Sales by Period & % Change

NET SALES TY VS. LY % CHG BY PERIOD

-15%

0%

15%

30%

P 1 P 4 P 7 P 10 P 13

15.3% over LY

This Year

Last Year

125M

250M

Front Line Essentials Internet Classics Futures Virtual

12.5%

10.2%

(5.6%) (4.5%) (34.9%) 5.5%

Total VINTAGES Sales: $383.7 M, up 15.3%

NET SALES BY PROGRAM 10-11

2009-10 2010-11

Total Vintages Products Released

0

3,500

7,000

2006 2007 2008 2009 2010 2011

6,2256,140

6,6836,927

5,6335,953

# of Products

TRANSACTION VALUE 2010-11

$40.00

$50.00

$60.00

P 1 P 4 P 7 P 10 P 13

$43.00

$48.05

$56.11

$47.54

0%

12.5%

25%

P1 P 2 P 3 P4 P 5 P 6 P7 P 8 P 9 P10 P 11 P 12 P13

4.4%

20.1%

12.3%

18.2%19%

23.2%

16.7%18.2%

13.6%14.9%

13.1%

17.1%

10.5%

Transaction % change by Period

NET SALES BY TOP COUNTRIES

3. Italy$68.3M

16.5% Growth19.4% Market

Share

1. USA$71.8M

27.0% Growth20.3 % Market Share

4. Australia$32.4M

5.3% Growth9.2% Market Share

6. Canada$21.2M

5.4% Growth6.0% Market Share

5. New Zealand$23.8M

31.0% Growth6.8% Market Share

2. France$68.8M

11.5% Growth19.5% Market

Share

Fiscal 2010-11

TOP SET PERFORMANCE

2010-11 % Chg Market Share

California Red $52.6M 26.7% 13.7%

Italy Red $50.7M 19.5% 13.2%

France Red $36.2M 17.0% 9.5%

Australia Red $28.8M 5.4% 7.5%

New Zealand White $20.3M 30.0% 5.3%

Argentina Red $17.7M 18.0% 4.6%

California White $16.3M 25.8% 4.3%

Spain Red $12.7M 15.5% 3.3%

2010-11 % Chg Market Share

California - Cab. Sauvignon $33.1M 31.3% 8.6%

New Zealand - Sauv. Blanc $17.0M 33.7% 4.4%

Australia - Shiraz $16.6M 8.3% 4.3%

California - Chardonnay $13.1M 33.4% 3.4%

Argentina - Malbec $12.3M 23.9% 3.2%

Italy - Pinot Grigio $11.9M 4.9% 3.1%

Italy - Tuscany Red $10.2M 20.0% 2.7%

TOP SUBSET PERFORMANCE

Net $ Sales % Chg. White Table $6.3M 14.5%Red Table $5.2M (0.8%)Other Table $1.0M 15.6%

SUBTOTAL $12.6M 7.7%Icewine $6.0M 7.0%

ONTARIO TOTAL $18.6M 7.5%

ONTARIO VQA WINES

Price Band Q1 Q2-Q4 Trend Change

$0.00 - $9.99 $150K $1.1M (7.2%)$10.00 - $14.99 $13.4M $49.0M (26.5%)

$15.00 - $19.99 $28.2M $119.9M 6.7%

$20.00 - $24.99 $8.6M $38.5M 22.4%

$25.00 - $29.99 $2.9M $13.0M 15.9%

$30.00 - $49.99 $5.0M $31.3M 41.9%$50.00 - $99.99 $3.8M $18.9M 14.0%$100.00 and above $3.3M $15.6M (47.9%)

TOTAL $65.5M $287.2M 6.0%

WINE SALES Q1 VS. Q2-Q4

2010-11 Highlights

• Return of premium and ultra-premium sales/customers

• Category teams quick response to changes in buyer behaviour

• Continued expectations of value at every price point

2010-11 Highlights

• Strength and impact of our Front Line Retail business

• Release publication - continuous enhancements

• Continued Buying Opportunities

• Strong Canadian dollar

• Excess inventory/offers

2010-11 Highlights

• Enhanced Inventory Management and Flow

• Positive impact of new/renovated stores

• 19 new stores/32 major renovations

• Events program & impact on customer engagement

2010-11 Highlights

• Growth of Ontario wines

• Implementing “Notice to Purchase”

• One-on-One Product Call

Vinexpo 2011

• Tom Wilson representing VINTAGES

• For possible appointments, send email to me with business rationale and proposed agenda

Kate Mallett-Thomas, Director, Vintages

2010-11 BUSINESS PLAN

OVERVIEW & KEY INITIATIVES

Sourced and purchased 6,178+ fine wines & premium spirits in 10-11• Vintages Retail Releases and Essentials• Direct Sales Programs: • Classics Collections, Futures, VSO and Virtual

SALES & PURCHASING TEAM

Kate Mallett-Thomas

Director, Sales & Purchasing

Tamara Jakes Category Manager, New World Wines

Greg DunlopCategory Manager, European Wines &

Spirits

Susan WheelerAssociate Manager,

VINTAGES Programs

Allan CraikVINTAGES Reception

Laurie Harvey Associate Manager,

VINTAGES Direct Programs

Responsible for researching and producing content for:Publications (28/year),Websites, Virtual offers (~50/year), VMail and supporting programs & events.

PUBLICATIONS TEAM

Susan WheelerAssociate Manager, VINTAGES Programs

Leo WigglesworthPublications Coordinator

David ChurchillWriters

Topic TopicTeige ReidWriter

Douglas WebsterWriter

DIRECT SALES TEAM

Laurie HarveyAssociate Manager,

Direct Programs

Jim BrownDepot/Program Analyst

Cale SampsonDirect Sales Processing Clerk

Responsible for coordination of direct programs with Call Centre, trouble-shooting customer complaints, spearheading key project initiatives related to direct programs such as Direct Delivery of online purchases

Achieve Financial Objectives

1.Net Sales of $425M, 11.0%

2.Gross Margin of $209M, 11.4%

3.Increase inventory turns to 3.32 from 3.27 LY (Warehouse & Retail)

FINANCIAL OBJECTIVES 11-12

NET SALES PLAN BY PROGRAM

2010-11 2011-12 % Chg.

Front Line $235.5M $262.2M 11.3%

Essentials $136.4M $148.9M 9.2%

Classics $12.9M $14.3M 11.4%

Bordeaux Futures $9.2M $11.7M 21.1%

Virtual Offers $1.9M $2.5M 27.1%

VSO $2.2M $2.4M 11.4%

GRAND TOTAL $383.7M $425.2M 11.0%

NON-FINANCIAL OBJECTIVES

1. Program Enhancements• Release Program• Essentials• Direct Programs

2. Update on Key Projects• Merchandising Initiative• Open Call Day• Environment Direction

Front Line Release Program: • Take the existing customers up in price value

chain• Systematically increase investment in price

bands above $20• Increase net per litre and average

transaction spend• Keep the new VINTAGES customer with more

approachable price points ($15-$20)• Continue to deliver exceptional price/quality• More balanced assortment across all price

points

PROGRAM ENHANCEMENTS

Front Line Release Program: • Transition high volume program products to

be received into Durham Warehouse facility• Food & Drink, Wines of the Month,

Collaboratives to be case compliant • Benefit of auto replenishment of stock

until depletion improving sales potential

PROGRAM ENHANCEMENTS

Essentials:• Implementation of new sales targets

including a multi-metric scorecard tracking:• Promotional spend• Licensee sales• Store Distribution• Implementation by Q2

Metrics to be negotiated jointly with agent/supplier annually and maintained

PROGRAM ENHANCEMENTS

Essentials:• Continue to focus on growth opportunities

• Ongoing refreshing of portfolio

• Launch program for new Essentials• Participate in LCBO FSIs• Continue VINTAGES on Vacation/

Holiday promotional programming

PROGRAM ENHANCEMENTS

Direct Programs:

• Classics Program: Rationalize & Review• Deep dive on customer research• Determine best method to offer new

collection of products• Continue to streamline purchasing

method for customers• Facilitate improved post-program access

to residual stock

PROGRAM ENHANCEMENTS

Direct Programs: • Virtual Program: more rigorous, structured

annual plan• Target iconic brands/producers• Better manage the timelines of offers to

mitigate overlaps• Solicit offers from the Trade to fill gaps• Improve delivery timelines of orders to

customers

PROGRAM ENHANCEMENTS

VSO and Vintages.com:• Continue to seed new products including

residual Classics, Virtuals & ISDs into VSO and VSO Bin End• Provide dual access to on-line shopping

and stores orders simultaneously• Continue to pursue Direct Delivery

shipping option for customers purchasing online

PROGRAM ENHANCEMENTS

Retail Merchandising Strategy: Test Initiative• Best flow of product by country

• That works in multiple VINTAGES Corner layouts

• Drives traffic into VINTAGES

• Allows for discovery• Timing for test - Q3

PROJECT UPDATES

Retail Merchandising Strategy: Test Initiative

• Ensuring key programs have a consistent location • Program Wines• New Release Section• Essentials• Unique product categories:

Spirits, Specialty, Rosés

PROJECT UPDATES

Retail Merchandising Strategy: Test Initiative • Will be partnering with Marketing &

Inventory• Improved signage• Satisfies Central Allocation Program

needs

PROJECT UPDATES

Environment:• Continue to source organic, biodynamic and

sustainably produced products.• Added organic symbol to the product

index of Release for customers• Ensure all new Essentials are within a

reasonable weight relative to the 360 – 420gr target

• Continue to target Essentials with heavy weight bottles priced under $20 to move to lighter weight over time

PROJECT UPDATES

Trade Relations:• Continue to meet with Drinks Ontario/

WCO and various Trade groups to plan programs, execute tastings, address issues and concerns and announce changes in VINTAGES

• Will be executing the One-on-One Open Call #2 September 13th 2011. Announcement to follow in early June

PROJECT UPDATES

NEW WORLD WINES

2011-12 Category Plan Highlights Presented by Tamara Jakes, Category Manager

NEW WORLD WINES TEAM

Tamara JakesCategory Manager, New World Wines

Paul FarrellProduct Manager,

New World Wines

Greg MacDonaldActing Product Advisor

Specialty Portfolio

Liam DohertyCategory Administrator

Alanna BaileyProduct Manager, Canadian Wines

Holly GarnerCategory Clerk

NEW WORLD NET SALES

*excludes all Spirits, Kosher & Accessories

2010--11 2011-12 FForecast

TY % Chg Yr Total % Chg

Front Line $119.0M 15.5% $132.1M 11.0%

Essentials $80.6M 20.7% $88.2M 9.4%

Futures & Directs $1.2M (20.0%) $669K (43.2%)

SUBTOTAL $200.8M 17.3% $220.9M 10.0%

1. Essentials Portfolio Rejuvenation

• Year over year sales increases, static SKU count

• Products are expected to be supported with appropriate promotional initiatives to ensure growth (VINTAGES & Supplier)

NEW WORLD INITIATIVES

2. Collaborative SKU Strategy

• Right mix & right number of SKUs

• Plan multiple releases to maximize sales opportunities (seasonality, etc.)

3. Front Line Releases • Flexibility to test new product & varietals

with smaller volumes - increase focus on fresh assortment

NEW WORLD INITIATIVES

4. Virtual Offers• Low risk opportunity to bring higher priced

& niche products to our customers

5. Events• Continue to align category thematics

(multi & single supplier)

6. Collaboration with LCBO Wines• Category in Section, FSIs, 4th shelf on end

aisles, etc.

NEW WORLD INITIATIVES

CATEGORY SHARE 2010-11

Other30.6%$61.4M

Ontario9.2%

$18.6M

California34.7%$69.6M

Argentina9.6%

$19.2M

Australia16.0%$32.1M

2010--11 2011-12 FForecast

Net Sales % Chg Net Sales % Chg

Total Red Table $5.2M (0.8%) $5.4M 4.8%

Total White Table $6.3M 14.5% $7.1M 13.3%

Total Other $1.0M 15.6% $1.2M 12.5%

TOTAL TABLE WINE $12.5M 7.7% $13.7M 9.7%

Total Icewine $6.0M 7.0% $6.3M 4.9%

TOTAL ONTARIO $18.6M 7.5% $20.1M* 8.2%

ONTARIO NET SALES

*Forecast currently under review

• Review, rationalize and refresh Essentials

• Ontario Flagship program – offer over $20 wines to targeted stores

• Rapid Release program to re-offer top performing skus to customers

• LCBO Wines/VINTAGES cross merchandizing opportunities

ONTARIO HIGHLIGHTS

• Events and Virtual Offers

• Taste Ontario: Toronto in September & Ottawa in February

• Ontario Wine Awards Virtual offer planned for Summer 2011

ONTARIO HIGHLIGHTS

ONTARIO HIGHLIGHTS

• Icewine tactical promotions - capitalize on key holidays and events to help drive sales • e.g. Chinese New Year, Valentines,

Pride

• Niagara on the Lake Icewine Festival

• Period 7 Stand Alone Mini Feature• Focus on:

• Riesling, Chardonnay & Pinot Noir as well as Sparkling and Icewine

• 22 products• 19% increased investment

• Ontario Wines included in majority of shared features:

• Easter, Rosé,Canada Day, Sparklers, Cool Climate Chardonnays, Thanksgiving, Dessert Wines and Our Finest

ONTARIO HIGHLIGHTS

CALIFORNIA NET SALES

2010--11 2011-12 FForecastNet Sales % Chg Net Sales % Chg

Total Red Table $52.0M 26.7% $57.2M 10%

Total White Table $16.4M 25.1% $18.1M 11%

TOTAL CALIFORNIA $68.4 M 26.3% $75.3M 10.2%

1. Product/Assortment • Addition of California red to Essentials

(Cakebread Cabernet $99.95) • Focus on assortment/premium price point in

Front Line Releases• Educate Customers about regions outside

Napa and Sonoma

CALIFORNIA HIGHLIGHTS

CALIFORNIA HIGHLIGHTS

2. Program Highlights• Sales in 2010-11 superceeded France & Italy

for #1 positon in VINTAGES sales• Four California focused features in the fiscal

calendar (One per Quarter)• Focus on Cabernet Sauvignon, Zinfandel &

Chardonnay

CALIFORNIA HIGHLIGHTS

2. Program Highlights• Showcase regions of California in lifestyle &

educational release features • Increased investment in Classics Catalogues• Augment portfolio with premium Virtual

offers, Library offers, Iconic and premium brands

AUSTRALIA NET SALES

2010-11 2011-12 FoorecastNet Sales % Chg Net Sales %Chg

Total Red Table $28.9M 5.3% $31.7M 10%

Total White Table $3.2M 7.2% $3.6M 12%

TOTAL AUSTRALIA $32.1M 5.5% $35.3M 10.0%

AUSTRALIA HIGHLIGHTS

1. Product/Assortment • Addition of Australian Essential

(Ringbolt, $19.95)• Key will be keeping pricing strategic and

competitive• Searching for new brands & new stories to

tell• 3rd party accolades combined with

competitive prices

AUSTRALIA HIGHLIGHTS

2. Program Highlights

• Features on: Australia’s First Families of Wine (Apr 30), Shiraz vs Syrah (Oct 1) and Australia: the Whole Story (Jan 21)

• Augment portfolio with premium Virtual Offers

ARGENTINA NET SALES

2009--10 2010-11 FForecastNet Sales % Chg Net Sales %. Chg

Total Red Table $17.8M 18.1% $21.9M 23%

Total White Table $1.4M 79.1% $2.0M 40%

TOTAL ARGENTINA $19.2M 21.1% $23.9M 24.4%

ARGENTINA HIGHLIGHTS

1. Product/Assortment

• Sales in Argentina have surpassed Chile for VINTAGES

• Showcase Malbec, Cabernet Sauvignon, Bonarda and Torrontes

• Explore premium regions: Salta, San Juan

ARGENTINA HIGHLIGHTS

2. Program Highlights• Release thematics in Summer (June 25) and

Fall (Oct 15) with focus on premium and more premium offerings from Argentina

• Look for our “Buyer’s Find” feature this fiscal

EUROPEAN WINES

2011-12 Category Plan Highlights Presented by Greg Dunlop, Category Manager

CATEGORY TEAM

Greg DunlopCategory Manager, European Wines,Spirits & Kosher

Igor Ryjenkov, MWProduct Manager,European Wines

David Beauroy Product Advisor,

European Wines/Sake

Lisa Chapman Category Administrator

TopicMarie CaponeProduct Manager,Spain, Portugal,Spirits & Kosher

Julian Sark Category Clerk

Lucy SkeardCategory Clerk

EUROPEAN NET SALES

22010-11 2011-12 FForecast

TY % Chg vs.

Plan Yr Total % Chg

Front Line $115.7M 17.9% 9.5% $130.1M 12.4%

Essentials $56.5M 6.8% 8.9% $60.7M 7.4%

Futures & Directs $10.1M (2.1%) (9.4%) $13.5M 33.5%

SUBTOTAL $182.3M 13.0% 8.0% $204.3M 12.0%

*includes all Spirits & Kosher

OPPORTUNITIES

• Continue to premiumize many of our succesful subsets

• Iconic brands that continue to do well still exceed our supply in many cases. Looking to increase our allocation in key brands

• Collaborative and Essential review • New Discoveries in all Categories• Initiatives – inventory catalogue for holiday

period

Other43.9%

$80.0 M

CATEGORY SHARE 2010-11

Bordeaux10.8%

$19.6M

Burgundy5.4%

$9.8M

Veneto9.2%

$16.7M

Tuscany12.4%

$22.6M

Spain - Red7.1%

$12.9M

Rhone7.4%

$13.6 M

Champagne3.9%

$7.1M

20100-11 2011-12 Foorecast

TY %Chg Yr Total %ChgBordeaux Red $18.3M 2.0% $22.6M 24%

Bordeaux White $1.4M 37.0% $895K (34%)

TOTAL BORDEAUX $19.6 3.9% $23.5M 19.6%

BORDEAUX NET SALES

BORDEAUX HIGHLIGHTS

1. Product/Assortment • 2008 vintage will be a positive influence on

sales• Focus on value wines from ’05, ’06, ’08

($20 - $50)• Moderate investment in older vintage - ’95, ’96,

2000, ’03• Tactics are becoming increasingly more

challenging with increased global demand

BORDEAUX HIGHLIGHTS

2. Program Highlights• Release thematics: Sept 17th - 2008 vintage• Virtual offers of Iconic Chateaux to reduce

risk and increase assortment• UDGC tasting of 2009’s in January 2012

BORDEAUX FUTURES

• Best price, ensuring access to the product• Size of the campaign is dependant on the

quality of the vintage

What are Bordeaux Futures?

B. FUTURES NET SALES - 5 YRS

$0M

$6M

$11M

$17M

$12.0M

$6.3M

$2.7M

$6.2M

$16.9M

2005

20062007

2008

2009

BURGUNDY NET SALES

20100-11 2011-12 FForecast

TY %Chg Yr Total %Chg

Burgundy Red $4.3M (6.2%) $5.2M 19%

Burgundy White $5.5M 2.9% $6.0M 10%

TOTAL BURGUNDY $9.8M (1.3%) $11.2M 14.3%

BURGUNDY HIGHLIGHTS

1. Product/Assortment • A varied assortment from the key brokers as

well as the small growers• Reds & whites will primarily be 2008-2009

vintages• Smaller lots of 2002, 2003, 2005, 2008 for

Classics

BURGUNDY HIGHLIGHTS

2. Program Highlights• Burgundy 2009 vintage - April 2011• Many Faces of Sparkling (Crémant)

July 2011• Pinot Face-Off - Sept 2011• More assortment in Nov-Dec releases• Virtual offers of Iconic wines• BIVB delegation tour every second year

(2013)

VENETO NET SALES (RED)

2010-11 2011-12 FForecastTY %Chg Yr Total %Chg

Veneto Amarone $6.7M 31.9% $7.5M 12%

Veneto Ripasso $7.6M 5.1% $8.4M 9%

Veneto Other $2.3M 28.8% $2.9M 26%

TOTAL VENETO $16.7M 17.7% $18.8M 12.3%

VENETO HIGHLIGHTS

1. Product/Assortment • Primary focus on Amarone and Ripasso• Larger assortment of Premium-priced

Amarones• Negotiate larger allocations from Iconic

suppliers where warranted• Target new customers with Essentials & Front

Line Ripassos and Valpolicellas

VENETO HIGHLIGHTS

2. Program Highlights• Release thematic in June 2011• Large representation in our November &

December releases• Amarone a key category in our Classics

Catalogue• Veneto to be representted in Le Donne del

Vino event in October 2011

TUSCANY NET SALES

2010-11 2011-12 FoorecastTY %Chg Yr Total %Chg

Other $10.3M 21.0% $11.8M 15%

Chianti $8.5M 25.1% $9.7M 14%

Brunello $3.8M 48.1% $4.2M 11%

TOTAL TUSCANY $22.6M 26.4% $25.6M 13.6%

TUSCANY HIGHLIGHTS

1. Product/Assortment • Super Tuscan in high demand (Sassicaia,

Ornellaia) • Focus on Iconic names in Chianti & Brunello• Look for Discovery brands in Western Tuscany

(Bolgheri, Maremma)• Take advantage of the strong 2007 vintage

where possible with a greater focus on 2008

TUSCANY HIGHLIGHTS

2. Program Highlights• Release Thematics October 15, 2011• Large representation in our November &

December releases • Solid investment in Classics Catalogue• Tenuta di Biserno - April 2011• Brunello Tasting & Dinner - June 2011• Tuscany to be represented in

Le Donne del Vino event - October 2011

SPAIN NET SALES (RED)

20100-11 2011-12 FForecastTY %Chg Yr Total %Chg

Rioja $4.9M 41.6% $5.4M 11%

Penedes $1.3M (21.6%) $1.3M 1%

Navarra $1.1M 4.7% $1.1M 4%

Ribera Duero $1.3M 42.0% $1.4M 8%

Priorat $306K 39.7% $349K 14%

Other $4.0M 6.2% $4.5M 11%

TOTAL SPAIN -RED $12.9M 16.4% $14.0 M 8.9%

SPAIN HIGHLIGHTS

1. Product/Assortment • Continue to offer Iconic wines from Rioja,

Ribera del Duero • Great interest in value wines from Penedes,

Navarra• Looking for established and New Discovery

listings

SPAIN HIGHLIGHTS

2. Program Highlights• Release thematic March 2012• Virtual offers of Iconic wines Vega Sicilia

RHONE NET SALES (RED)

2010--11 2011-12 FoorecastTY %Chg Yr Total %Chg

North $789K 20.0% $910K 15%

South $8.3M 18.9% $9.1M 10%

Chnf du Pape $4.5M 55.9% $5.3M 17%

TOTAL RHONE $13.6M 29.2% $15.3M 12.7%

RHONE HIGHLIGHTS

1. Product/Assortment • Continue to focus on Southern Rhone, focus on

CDR Villages, Chateauneuf du Pape• Purchase primarily 2010 vintage• 2009 vintage will be of strong brands and

proven performers • Small amounts of Northern Rhone for

assortment

RHONE HIGHLIGHTS

2. Program Highlights• Release thematic in May 2011, October 2011• Delegation from Rhone – early 2012• Interested in reviewing offers for events with

Iconic Rhone producers Tasting/Dinner

CHAMPAGNE NET SALES

2010--11 2011-12 F Forecast

TY %Chg Yr Total %Chg

TOTAL CHAMPAGNE $7.1M 8.7% $7.6M 5.7%

CHAMPAGNE & SPARKLING HIGHLIGHTS

1. Product/Assortment • Focus on Iconic names and Grand Marques• Volume opportunities on value brands $50-

$75• Increase assortment of vintage champagne• Significant investment in Crémant,

Prosecco, Cava

CHAMPAGNE & SPARKLING HIGHLIGHTS

2. Program Highlights• August 2011 Premium Brands for TIFF • July 2011 Many Faces of Sparkling • December 2011 Holiday Premium

Sparkling• Champagne event in November 2011

INVENTORY MANAGEMENT

2010-11 Overview and Key InitiativesPresented by Christine Botham, Inventory Manager

INVENTORY TEAM

Christine BothamInventory Manager

Gord FronerStore Allocations

Nancy PybusProduct Flow Specialist

European

Vahini SelvarajahPurchasing Clerk

Essentials - European

Paula Arruda Product Flow Specialist

New World

Jeryca DillasPurchasing Clerk

Essentials - New World

M

M

M

M

Warehouse Retail TotalActual/Forecast Plan Last Year

16.2%

1.5%21.0%

20.3%

(7.5%)

21.5%

YEAR END INVENTORY 10-11

Period to Date: 63.07M, 1.5 to Plan, 21.0 to Last Year

0X

3X

6X

9X

Retail Turns Warehouse Turns Total Turns

3.05X

5.17X

7.42X

3.28X

5.39X

8.35X

2010-11 2009-10

INVENTORY TURNS

Ongoing Initiatives

Improve VINTAGES Release Product Flow

Key Metrics Developed & Tracked

• Purchase Orders Placed On Time

• On Time Shipment

• On Time Delivery

Ongoing Initiatives

Vintage Release Product Flow - Compliance• Non Compliance (UPC, Label, Packaging,

etc.) delays the product

• Almost all products that miss the release date either ship late or require corrective work

• Products that miss the intended release date compromise sell through success

Ongoing Initiatives

Improve VINTAGES Release Product Flow• Pre Release Requests

• These requests should be sent to VintagesInventory@lcbo.com

• Front Line should be received 4 - 6 weeks prior to the release

• Classics should be received 2 weeks prior to customer order deadline

Ongoing Initiatives

High Volume Products• Programs: Wine of the Month; Food &

Drink; Collaboratives; etc.• Improved replenishment to fast moving

stores and improved order turnaround time• Packaging compliance to be taken into

consideration when selecting future program wines

Ongoing Initiatives

Central Allocation System• Head Office driven allocation of Retail

Releases and residual inventory of other appropriate programs

• Objective: “Right Product, Right Store, Right Quantity”

Ongoing Initiatives

Central Allocation System• Benefits:

• Optimize Sell Through• Retail Focus on Selling• Improved Replenishment

Ongoing Initiatives

Central Allocation System• Status:

• Best Practices Investigated• Requirements Developed

• Next Steps:• Trade Focus Group• Development• Pilot Implementation - Q4 - 2011-12• Full Implementation - Q1 - 2012-13

New Initiatives

Virtual & Event Offers Lifecycle Improvement• Objective: Reduce the time between Events

and commercialization of goods• Major challenges:

• Internal Manual Processes• Shipping delays• Product or Required Quantity

Unavailable• Incorrect Product/Vintage Received

New Initiatives

Aged Inventory Management• Reduction of Aged Warehouse inventory • Tools for the Retail team to manage aged

inventory are being rolled out• Benefits:

• Improved Inventory Position• Improved Turns• More shelf space for new product

EVENTS

2010-11 OverviewPresented by Rose Holness, Associate Manager

Responsible for producing Vintages Events 30+ annually

EVENTS TEAM

Rose HolnessAssociate Manager,

VINTAGES Events

VacantEvents Assistant

Felix Silva Events Assistant

Tricia LahdeEvents Assistant

1. Mission

2. Year in Review

3. 2011 Calendar

4. Partnership

EVENTS AGENDA

MISSION

BuildConnectEducateEngagePromoteSell

EVENTS - BEST IN CLASS

Type of Events include:

• Tasting and dinners with Iconic suppliers

• Large Tastings with multi-suppliers

• Structured Tastings followed by a Walk Around Tasting

• Classics and Educational tastings -Wine 101

34 Events completed

Sales generated from Events:• Net Sales of Products: $1.4M• 22% of customers place orders• Average customer spend: $1,046

#1 Selling Event - Vega Sicilia:• Total sales: $196,140• Average customer spend: $3,487• Sell Through: 70%

EVENTS - YEAR IN REVIEW

Attendees: 75Virtual & Event Sales: $22K

Attendees: 45Virtual & Event Sales: $35K

2011-12 SO FAR

Attendees: 75Event Sales: $43K

2011-12 SO FAR

Attendees: 181Event Sales: $2K

Attendees: 156

Attendees: Tor: 350 Ott: 282Event Sales: $73K

2011-12 UPCOMING EVENTS

Period 3 • VINTAGES/LCBO Trade Symposium -

May 25• Brunello Virtuosos - June 6• Pierre Trimbach - June 8

Period 5• International Cool Climate

Chardonnay Challenge - July 24Period 7

• Taste Ontario - Sept. 19• Montes - Week of Sept. 27• Women in Wine (Italy) - Oct. 3

2011-12 UPCOMING EVENTS

Period 8• Fete du Bordeaux - Oct. 24• Two Hands - Oct. 25

Period 9• “Family Wineries of the Okanagan" group

(Burrowing Owl, Mission Hill & Quails Gate) - Nov. 14

• Margrit Mondavi - Nov. 15Period 11, 12 &13

• Union des Grand Crus de Bordeaux - Jan. 27

• Work-in-progress

Step 3: Events Team

Step 2: Finalize Products

HOW CAN YOU PARTNER WITH US?

Events submission form

NISS

PARTNERSHIP

Step 1: Category Managers

Details, Details, Details

Format

Date

Venue

Ticket Price

…. & lots more

TEAM WORK

CATEGORYMARKETING

LOGISTICS

CONTACT CENTE

DOCUMENT SERVICES

RETAILQUALITY ASSURANCE

CHARITY

CATERERS

CUSTOMERS

VENUES

TRADE(AGENTS/SUPPLIERS)

VINTAGES TEAM

LICENSEE PROGRAM

2010-11 OverviewPresented by Robin Sirutis, Associate Manager

LICENSEE TEAM

LICENSEE PROGRAM

The Licensee Program provides the following services for the VINTAGES Licensee Customer:

1.Pre-order from our biweekly VINTAGES releases!

• Tastings of upcoming VINTAGES releases at LCBO Summerhill & LCBO Rideau & King Edward locations

• Approximately 40 products from the two releases per month are showcased for the licensee customer to taste

2. Licensee Tasting OpportunitiesLICENSEE PROGRAM

• Wine List Development

• Wine & Food Matching

3. Product Consultation & Advice

LICENSEE PROGRAM

4. Source of Information & Staff Training

LICENSEE PROGRAM

5.Foster Solid Relationships & Partnerships with our Licensee Customers

LICENSEE PROGRAM

We position ourselves as educators but the primary role of our program is to sell the VINTAGES Portfolio.

We are the sales force for VINTAGES products to Licensees

MISSION

November 2010 Record Breaking Sales!

Pre-release licensee orders were

$226,000

Our role is to look for novel business opportunities &

programs to meet the Licensees’ needs & increase sales

STRATEGIC FOCUS

“”

1. go Local

NEW INITIATIVES

2. Icewine Cocktail Promotion

NEW INITIATIVES

We want to work with you to sell the VINTAGES Portfolio to Licensee customers!

Contact myself or Charles to discuss ways to sell VINTAGES products together

robin.sirutis@lcbo.com

charles.lauzon@lcbo.com

CONTACT US!

FROM PRE-SUBMISSION

TO SAMPLE

Making the Process SmootherPresented by Allan Craik, VINTAGES

Key sections of the LCBO Trade Resources Online website:

• What’s New

• Letters to the Trade

• How to Introduce New Products to VINTAGES

• Grow Your Business with VINTAGES

• New Item Submission System (NISS)

LCBO TRADE RESOURCES ONLINE

LCBO TRADE RESOURCES ONLINE

PRODUCT NEEDS

Product Calls and Product Needs Letters:• Primary source for Product calls is the New

Item Submission System• Product Needs Letters are posted on the

LCBO Trade Resources Online website

PRE-SUBMISSION

Creating a complete Pre-submission:

• Save your work as you go along

• Fill in all the mandatory fields

• Enter accurate information

• Don’t miss an opportunity

• Meet the Pre-submission deadline

PRE-SUBMISSION

PRE-SUBMISSION

PRE-SUBMISSION

SAMPLES

Importing samples for tasting:

• Information can be found on the LCBO Trade Resources Online website: Documents\Standards & Regulations\Importing Product into Ontario for Commercial Purposes

VINTAGE CHANGES

• Send an email to the appropriate Product Manager and copy Allan Craik. Your email should include the following items:• The NISS Submission ID number (and the

LCBO number if it is known)• The product name• The current status of the submission• The tasting for which it is scheduled• The reason for the change request• The information you entered in the Score

and Other/Press Coverage fields • A compelling case for the substitute vintage

SUBMISSION CHECKLIST

SUBMISSION CHECKLIST

SUBMISSION CHECKLIST

SUBMISSION CHECKLIST

• Re-print the application before bringing it in so it will have the updated information

• Check the vintage of the sample and make sure the alcohol content on the hard copy of the application is exactly what is stated on the bottle - correct it by hand if you need to

• Quote on Supplier’s Letterhead

SUBMISSION CHECKLIST

SUBMISSION CHECKLIST

SUBMISSION CHECKLIST

• 3rd party reviews

• Wait for the Pre-submission to be accepted before bringing it in

• Submit the sample and paperwork together

• The samples and complete paperwork must be received by the sample due date

SUBMISSION CHECKLIST

SAMPLE CHECKLIST

The secondary mandatory fields must be filled in prior to submitting the sampleReprint the application before bringing it in so it will have the updated informationMake sure the alcohol content on the hard copy of the application is exactly what is stated on the bottle. Correct by hand if necessaryVintage of samples submitted must match the vintage accepted by the buyersInclude a signed quote on supplier letterhead using the VINTAGES quote template found on trade websiteInclude proof of 3rd party reviewsThe samples and complete paperwork must be received by the sample deadlineOut of country samples cannot be sent directly from suppliers. They must be submitted through the agent