Sault Ste. Marie Duty Free owner laments near 40% drop in revenue, blames 'tariff war'

The owner of Sault Ste. Marie Duty Free is lamenting the "tariff war," which he said has had a devastating impact on business as Canadians cut back on travel to the U.S.

Ralph Caria says he's seen a near 40 per cent drop in sales since President Donald Trump took office and later implemented sweeping tariffs.

"The [duty-free] shops across Canada, they're down 40 to 80 per cent," Caria told CBC Sudbury. 

"There are some shops in remote areas like in B.C., they're down 80 per cent. Obviously the Ontario duty free, I'm in Ontario, we're closer to the 40 per cent."

Caria said he would usually employ between 20 and 25 people during the summer. Those seasonal workers were excited about the summer, he said, adding they have been dealt a blow as they would be without a job this year.

"It has an impact on staff… They worked so hard getting on the road to recovering after the border closure due to the pandemic and they were in a positive mindset," Caria said. 

"When they worked so hard and they thought we were on the way to recovering out of COVID and they were excited for this summer … it's disheartening for them … it's another punch in the gut."

'We cannot sell to the domestic market'

Caria said duty-free stores are in a unique position where they can't pivot. 

"We cannot sell to the domestic market…I can't open my side door and sell to someone on a local street. I can't sell to you unless you're travelling to the U.S.," he said.

"We have to sell to people that are entering the U.S. and that would be Canadians travelling and that would be Americans returning home. As you could well envision, that's devastating when the border is closed like in the pandemic or now because of the tariffs."

FDFA appeals to Ottawa for help

Last week the Frontier Duty Free Association (FDFA), which represents 32 stores across the country, pleaded with the federal government to offer financial assistance to struggling independently owned duty free stores amidst the ongoing political and economic trade war tension.

An open letter penned on behalf of the association was sent to Prime Minister Mark Carney and Finance Minister François-Philippe Champagne on Tuesday.

The letter outlines what's referred to as a disproportionate impact the stores, and their work forces, are facing from tariffs and continued cross-border travel disruptions.

Barbara Barrett, the executive director for FDFA, says "immediate action" is needed from Ottawa.

"When travel slows or stops, our stores — all independently owned, family run and often the main employer in their towns — are the first to feel it and often the hardest hit," she told reporters during a Tuesday morning news conference on Parliament Hill. 

"Our communities can't afford to lose these businesses. That's why today's letter is so urgent and why we're calling on the government to step in before the damage becomes permanent."

Association president Tania Lee says the FDFA is looking for things such as liquidity support for its hardest hit stores, and clarity on export rules.

"Our ask is modest, but the need is urgent," Lee said.