‘Shop local’ brings own challenges as tariffs loom Biz owners brace for change; interprovincial trade barriers continue to be targeted
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Hey there, time traveller!
This article was published 03/03/2025 (600 days ago), so information in it may no longer be current.
Over the past couple of months, Wolseley Kombucha drinks have flown off grocery store shelves.
Owner Michelle Leclair tracked the company’s best January on record and a roughly 50 per cent year-over-year sales increase.
Should the “shop local” movement continue, it’ll be a busy summer, Leclair said. There’ll be a need for new fermenters and other equipment.
“We’re definitely going to have to do some strategic planning.”–Business owner Michelle Leclair
New packaging might also be required.
Many of Wolseley Kombucha’s bottles come from the United States; it’s unclear how pricing could be affected by a trade war.
U.S. President Donald Trump stated Monday afternoon he’d implement sweeping 25 per cent tariffs on Canadian imports, and a 10 per cent levy on Canadian energy, beginning Tuesday.
“We’re definitely going to have to do some strategic planning,” Leclair said.
She joins business owners across Canada facing imminent operational changes. Upwards of $37 billion worth of goods were traded between Manitoba and the U.S. last year, per Canadian Chamber of Commerce data.
Prime Minister Justin Trudeau has previously threatened tariffs on American imports, which has left many businesses bracing for hits from both sides of the border.
Meantime, the removal of interprovincial trade barriers has become an increasingly public conversation. More announcements regarding barrier removal are likely coming, the president of the Manitoba Chambers of Commerce hinted.
“If tariffs do come in and (leave) a negative impact… any amount of extra sales in Canada will be a good thing,” said Chris Warwaruk, co-owner of Farmery Estate Brewery.
The beer supplier has presented to Ontario’s liquor control board several times. However, Farmery products compete against alcohol from around the world; all are considered “imports” in Ontario. Breaking into the most populated province’s market is an uphill battle, Warwaruk said.
He’s anticipating prices on Farmery’s U.S.-produced aluminum cans to skyrocket; he’s sought Canadian alternatives for more than a decade. Cans could come from Asia, but the difference in transport time is enormous, Warwaruk said.
“We’re going to be seeing a lot of adjusting,” predicted Tyler Slobogian, the Canadian Federation of Independent Business’s senior policy analyst for the Prairies and Northern Canada.
“It is going to be difficult, I think, for businesses to absorb the costs that come with these tariffs.”
Often, small businesses’ bottom lines are “not very high.” Tariffs could lead to steeper prices for customers, as well as layoffs and company closures, Slobogian said.
Two-fifths of the CFIB’s Manitoba members said they weren’t prepared for new tariffs.
Roughly 80 per cent of Manitoba’s food and beverage manufacturers have less than 10 staff, said Michael Mikulak, executive director of Food & Beverage Manitoba. One of the association’s biggest worries is the survival of small companies.
“Consumers will not eat the cost difference if, all of a sudden, you need to raise your prices 25 to 50 per cent,” Mikulak said. “The affordability crisis is still hitting people very hard.”
Manufacturing accounts for roughly 10 per cent of Manitoba’s GDP. Food & Beverage Manitoba represents around 300 members.
Larger manufacturers have been eyeing moving production and jobs to the U.S., Mikulak noted. A recent Canadian Manufacturers & Exporters survey found nearly half its members nationally would shift some production to the U.S. to avoid tariffs.
Food & Beverage Manitoba is recommending the federal government place tariffs on American end products and not ingredients. That way, local entrepreneurs aren’t paying extra to make their goods. It’s hard to find new suppliers and customers on a dime, Mikulak stressed.
He’s recently had meetings with Red River Co-op and the province’s school nutrition program about sourcing more Manitoba-made items.
“A lot of retailers are looking (at), ‘Well, how can we fill that (shop local) demand?’” Mikulak said. “They’re looking to see if they can replace American products with some Canadian ones.”
“As much as we are trying to avoid the tariffs, we need to focus on things that we can control.”–Chuck Davidson
It’s important to find new export markets, Mikulak said. He and Slobogian also emphasized the importance of breaking down interprovincial trade barriers.
Varying provincial regulations on liquor sales, trucking and professional credentials — among other things — have made conducting business on a national scale more difficult. Nova Scotia introduced legislation last week to remove its interprovincial trade barriers.
More announcements are likely to come, said Chuck Davidson, president of the Manitoba Chambers of Commerce.
“We’re starting to really recognize that as much as we are trying to avoid the tariffs, we need to focus on things that we can control,” he said.
Interprovincial trade barriers are a common topic in Manitoba’s U.S. Trade Council, said Davidson, who’s a member. More support for buying local and local procurement are also repeatedly mentioned.
“It’ll be important that government continues to have these conversations to understand, from a business standpoint, what are the hurdles (businesses are) going to be dealing with?” he continued, adding government programs may be necessary.
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Perhaps the biggest interprovincial trade barrier is the distance between jurisdictions, noted Barry Prentice, a University of Manitoba supply chain management professor. The drive to Minneapolis is shorter than Toronto, he said.
Ben Carr, MP for Winnipeg South Centre, visited Washington last week to speak with American lawmakers. Education was often needed to highlight the “substantial reliance” U.S. and Canadian companies share.
The challenge is delivering the message to the president and his executive branch, Carr said.
He repeated the same message while on Capitol Hill: “Do not underestimate the resolve of the Canadian people, and do not underestimate the extent to which we will be willing to withstand hardship in defence of who we are.”
Republican senators and house representatives Carr spoke to did not agree with Trump’s comment about making Canada the 51st state.
Trump previously declared 25 per cent tariffs would hit Canadian imports on Feb. 4. After he paused the plan for a month, shipments travelling south of the border increased, according to the Manitoba Trucking Association.
“There are a lot of people that want to ensure… freight is moving in advance of a potential tariff,” said Aaron Dolyniuk, the association’s executive director.
A freight slowdown will likely come this week, Dolyniuk said.
Twenty-five per cent tariffs on steel and aluminum are set to begin March 12. The U.S. administration previously said levies could be stackable.
gabrielle.piche@winnipegfreepress.com
Gabrielle Piché reports on business for the Free Press. She interned at the Free Press and worked for its sister outlet, Canstar Community News, before entering the business beat in 2021. Read more about Gabrielle.
Every piece of reporting Gabrielle produces is reviewed by an editing team before it is posted online or published in print — part of the Free Press‘s tradition, since 1872, of producing reliable independent journalism. Read more about Free Press’s history and mandate, and learn how our newsroom operates.
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