A nationwide shutdown of Canada Post is set to have major implications for the biggest shopping weekend of the year, experts warn.
Workers at the national postal service remain on strike for a second week, with the Crown corporation reporting that “limited” progress was made on talks over the weekend.
The union representing striking postal workers is seeking improved wages to catch up with years of inflation and job security, while Canada Post is looking to implement a new model that could roll out seven-day-a-week delivery to bolster its struggling business.
The postal service said Monday that it has missed out on delivering some 10 million parcels in the first 11 days of the strike.
With Canada Post ground to a halt heading into the busy Black Friday-Cyber Monday weekend, businesses and experts are warning consumers may end up paying more or missing holiday gift-giving deadlines as a result of the strike.
Retail analyst Bruce Winder says that the impacts on Canadian shoppers will vary depending on where they’re spending their money this weekend.
For those shopping on the pages of mega-marketplaces like Amazon or on the websites of other major retailers, the impact from the Canada Post strike is likely to be minimal, he explains.
That’s because it’s predominantly small businesses who lean on the national postal service for affordable shipping, whereas the bigger players have their own logistics networks and standing contracts with couriers to fall back on.
Winder says that for small business owners who want to get their products out to customers to take advantage of the busy holiday shopping season, they’ll likely have to turn to the more expensive couriers — and much of those costs could be borne by the consumers themselves.
“The (price) increase is significant from Canada Post to the couriers. And most small businesses can’t afford to eat that,” Winder says.
Get weekly money news
Get expert insights, Q&A on markets, housing, inflation, and personal finance information delivered to you every Saturday.
Dan Kelly, president of the Canadian Federation of Independent Business (CFIB), notes that some small businesses are likely to take a loss this season just to get goods out the door and avoid inventory pileups in the new year.
But even if small business owners do bite the bullet and pay more for the costlier couriers, Kelly warns there are some areas of the country that those providers don’t reach. Some rural and remote communities are solely serviced by Canada Post, with those consumers likely out of luck until the strike is resolved.
“If we don’t have the strike resolved this week, most merchants are not going to be able to use Canada Post as a reliable delivery service,” Kelly says.
Even if the strike does get resolved ahead of Black Friday, both Kelly and Winder warn it won’t necessarily be smooth sailing for deliveries over the holiday.
It will likely take multiple weeks for Canada Post to clear the backlog of unsent items from its warehouses and catch up with the flood of demand once workers are back off the picket lines.
“It’s going to take a few weeks before Canada Post can get rid of the existing backlog that it’s sitting on, let alone start to deliver new goods,” Kelly says.
Even if there’s a deal achieved relatively soon, Winder warns that many packages are likely to be delivered via Canada Post after Christmas — “unless there’s a miracle.”
Alternatives amid the Canada Post strike
Even with Canada Post currently out of commission, there are some workarounds that could see gift-givers and deal-seekers come out on top for the Black Friday-Cyber Monday weekend, Winder says.
Already, cash-strapped consumers are turning to alternatives like Chinese discount retailer Temu, he notes, or opting for second-hand routes like Facebook Marketplace to find gifts or new clothes.
To reduce the burden on gift-givers, he recommends doing a Secret Santa-style exchange with family to cut down on the sheer number of gifts or to make presents from scratch.
“There’s all kinds of things happening where people are just trying to find a way to save money,” Winder says.
And just because Black Friday is traditionally a major holiday shopping event, that doesn’t mean eager shoppers shouldn’t wait a few more weeks.
The Liberal government has proposed a GST/HST “holiday” starting Dec. 14. During this two-month period, a wide number of common gifts including clothing, toys, video game consoles and more will see federal sales taxes waived.
Winder says that if those items on a shopper’s list are not heavily discounted around Black Friday, he could see consumers holding off to take advantage of the tax exemptions a few weeks later.
“If there’s not a lot of savings, if it’s sort of an item that’s regularly priced, certainly they’re going to look at the category more seriously once the GST holiday comes into effect,” he says.
— with files from Global News’s Sean Previl
© 2024 Global News, a division of Corus Entertainment Inc.
