Page 17 - TFWA World Exhibition and Conference 2025

INSIDER

Canada’s land border stores face real danger of closing from drop in
traffic

The tariffs are having a devastating
impact on Canadian duty free, as fewer
Canadians are traveling south in response
to U.S. President Donald Trump’s trade war
with Canada. One Canadian land border
store has already shut its doors because of
the lower traffic and sales, and many others
fear they will follow, FDFA Executive
Director Barbara Barrett tells TMI.
“It was truly pandemic level traffic
over the summer. John Slipp’s Woodstock
Duty Free in New Brunswick closed in
August. The more remote the store, the
more difficult it is for them. John’s store
is in the east, and some in the west are in
the same situation, worried about having to Woodstock Duty Free was forced to close this August after more than 40 years
close,” says Barrett. in business, because of lower traffic at the U.S./Canada border.
“We did a survey before the summer,
and a third of our members said that if they liquidity, which will be helpful in the short is just temporary, and traffic and sales will
didn’t have a good summer that they may term for our stores.” return.
be looking at closing.” In the longer term, the FDFA is “It’s really hard to have optimism at
Sales are down across the country advocating for small regulatory changes this time. But what we’re sure of, because
anywhere from 50-60%, says Barrett. that Barrett says would “allow us to have a we’ve been through a crisis before, is that
“In the more remote areas, sales can more level playing field with the U.S.” this is a moment in time and then business
be down from as much as 80%. Ontario The FDFA says that there is still a and traffic will come back.
and some of the more central stores are misunderstanding of how land border “These are viable businesses that have
doing better, down by 30-50%. Those are duty free works throughout government been part of the Canadian tourism fabric
still big numbers, no matter how you look departments. for over 40 years. These are family-run
at it,” she says. “There’s an erosion of the businesses that are very integral parts of
The cross-border traffic numbers are understanding that we are an export small communities across Canada. We
as bad as the sales. Road trips to the U.S. industry. As a result, some domestic can’t lose them.
decreased for a seventh straight month in policies and domestic taxes have been “Our land border between Canada and
July as Canadians continued their American applied that should not be put on us. We’re the U.S. is very special. We’ve enjoyed that
boycott. Canadian-resident return trips by asking for a directive from the Minister of flow of traffic back and forth for decades,
automobile from the U.S. fell 36.9% in July Finance to all departments to clarify that and border communities on both sides
versus a year ago, according to Statistics we are, in fact, export.” really are dependent upon that flow. So it
Canada data. The FDFA is also asking for the will come back.
“Statistics Canada has been reporting removal of an excise tax on tobacco sold in “We just have to get through this
a steady decline every month. Canadians duty free. moment in time, and we need some support
have been quite vocal saying they’re not “This is an excise tax that our getting through it. And then we will thrive
traveling to the U.S. and won’t be for some American counterparts don’t have. We’re again.”
time.” asking the government to level the playing
Barrett and the FDFA are strongly field and align that excise tax on tobacco Scaled down 2025 FDFA Convention
advocating for help from the Canadian products for us.” Due to the ongoing challenges facing
Federal Government to make sure that the duty free industry in Canada, the
more land border stores don’t have to close. Tariff threats halt post-pandemic FDFA made the decision to scale down its
“We are in constant dialog with recovery traditional convention into a more focused
both the Prime Minister’s Office and the Before the tariff threats, Canada’s land and intimate format.
Minister of Finance’s office. So they’re border duty free stores were on the road to “We had to take a measured approach.
well aware of our situation. The Prime recovery from Covid-19’s impact on travel, We had to see the status of the stores,
Minister just announced a $5 billion fund says Barrett. where our suppliers were, and the best way
for small- and medium-sized businesses “Most stores were starting to approach to move forward. We are holding an event.
most affected by tariffs, and we are 2019 levels of traffic and sales. As soon as We’re not calling it a convention. It will be
working with finance to ensure that we the tariff threats and rhetoric came, traffic smaller and more focused, and we plan on
qualify for some portion of those loans. and sales fell off a cliff,” she says. coming back in full force again after we get
It looks like we will qualify for some But Barrett is sure that the latest crisis through this moment in time,” says Barrett.

17 October 2025