Anyone for Swede?

16 May, 2008

Drinks retailing in Sweden is controlled by the state monopoly. Graham Holter wonders if the UK has anything to learn

If drinks retailers are causing government and society such a problem, there's a solution staring legislators in the face: nationalise them. Ban all private sales of alcohol and make the state responsible for sourcing and selling all beers, wines and spirits. Opening hours could be curtailed, prices fixed, promotions banned. Sounds extreme? That's how it works in Sweden.

Since 1955, the Systembolaget has been in control of Swedish drinks sales. It operates around 400 stores around the country, though in areas where populations are too low to justify a shop, agents will deal with orders. It's not as bad as it sounds: there are a respectable 1,400 wines on the approved list, specified by a committee of experts whose job it is to work out how many Argentine Malbecs should be available or whether Swedes have a right to access Coteaux du Layon. Anything not immediately to hand generally arrives in a couple of days.

Getting on the central list is a question of having a product which meets a perceived need. The Systembolaget is constantly refreshing its range

and if the tender goes out for, say, a Chilean Pinot Noir, one of 485 approved suppliers is likely to represent a producer who has one available. Before the wine is accepted, it will be put through its paces by a panel of experts.

No promotional activity or multipacks are allowed in Systembolaget shops, and merchandising must not be seen to give certain products a competitive advantage (for example, shops must either chill all of their lager, or none of it - impulse sales are not on the agenda).

Sales staff tend to be knowledgeable and well-trained, and with many stores not yet converted to self-service, staff ­recommendation plays a big role in determining consumer purchases. Indeed, a Wine Intelligence survey found that 57% of regular wine drinkers said they bought wines on the advice of a sales assistant - the figure is just 28% in the UK, where 59% of consumers surveyed said they would be swayed by a promotional deal.

Liberals happy

A n untainted system? Not necessarily - in 2005, 77 Systembolaget managers were accused of taking bribes from suppliers, with 33 subsequently being convicted

at one of the biggest trials ever seen in Sweden.

State control of alcohol may seem slightly at odds with Sweden's liberal, tolerant image, but the Systembolaget is widely liked by Swedes - even if they are not averse to making savings by importing drinks, legally or illegally. Tax is calculated according to alcoholic strength, meaning that wine is not particularly expensive by UK standards but spirits are certainly beyond our comfort zone.

Darren Packman, an English beer ­consultant who lives and works in Sweden, says the Systembolaget has had to adapt to retain public support.

"When I first came here in 2000 it was a very Soviet experience - you chose your product from behind a glass screen, got a paper ticket and maybe waited 45 minutes," he says. "There was no weekend opening, which was very inconvenient if you worked. But now stores are more customer-friendly with longer opening hours and wide self-service aisles.

Bigger range

"In principle I'm against monopolies but in Sweden, because of the culture and the geography, it works and the vast majority of drinkers are very satisfied with the range that's available. I get incredibly frustrated about some of the beers I can't get access to but the range is still bigger than it would be if there was a conventional retail model."

Packman says the system does not prevent binge drinking, and with prices in the on-trade extremely high, it ­encourages the Swedes' natural tendency to "pre-load" at home before a night out.

"The monopoly is based on the principle that there should be no private profit motive in the sale of alcohol," the official explanation goes. "Without any private profit motive, there is no reason to try to persuade customers to buy as much as possible, and no reason to sell to people

under 20 years old. This idea has proved highly effective in practice. Alcohol consumption in Sweden, which in the early 1800s was among the highest in Europe, is today among the lowest.

"The scale of alcohol-related problems is much less than in comparable countries without an alcohol retailing monopoly. But since Sweden joined the EU, the monopoly can no longer be taken for granted. It will only survive if it is supported by a majority of the Swedish population. So we have to do everything we can to ensure the continuing and growing satisfaction of customers," it continues.

Healthy attitude

Systembolaget says its mandate

is to help "limit the medical and social damage caused by alcohol and thereby improve public health". It does this by keeping

alcohol consumption levels

low through limited availability

and opening hours.

The official line adds: "Our goal is to establish a healthy drinking culture whereby everyone can enjoy Systembolaget's drinks without harming either themselves or other people. Systembolaget shall use its expertise to inform customers both about the effects of the various drinks on people's health and about their taste characteristics. Systembolaget shall inspire people to take an interest in what they drink and to adopt a healthy attitude towards alcohol."

Packman adds: "The monopoly is a historical solution to what was a real problem in every part of the country - the Swedes were killing themselves drinking. They feel comfortable with it and they understand it. There is always talk about doing away with it, and whenever the question is asked, the answer is always the same - 'in five years'."

Other monopoly drinks retailers

Iceland: Vínbúð is the state monopoly off-licence with 46 shops. On-trade rivals are penalised with high taxes.

Finland: Alko sells all wines, spirits and beers over 4.7% abv. Window displays are banned; products over 22% abv are sold, but not promoted in any way (including in price lists).

Norway: Vinmonopolet is the only retailer allowed to sell products stronger than 4.7% abv.

Ontario: The Liquor Control Board has a virtual monopoly though some producers are allowed to sell alcohol from their own shops.

Quebec: Société des Alcools du Québec is a monopoly retailer and wholesaler. Embroiled in a revenue-raising price-fixing scandal in 2006.


The Liquor Control Board sells all alcohol to the on-trade, and hands out off-licences using a quota system of one per 3,000 inhabitants.

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