Local retailer Benson Mutalemwa credits community support for helping him to avoid a $15,000 loss this past spring.
Earlier this year, U.S. tariffs and a burgeoning “buy local” sentiment prompted many Canadian liquor boards and retailers to pull American products off the shelves. Mutalemwa, who sells non-alcoholic beverages at his store Knyota Drinks in Ottawa’s downtown, was in the media at the time saying that the boycott on U.S. products would translate to thousands of dollars in lost revenue as he was no longer able to sell his best-selling products.
However, he was not about to let that happen.
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“When the boycott started, we had quite a bit of American inventory. We were doing customer education around how the boycott impacts Canadian businesses, especially small businesses like mine … We were able to get that inventory to move. We got our working capital back and we’ve been able to re-invest in more Canadian products,” Mutalemwa told OBJ last week.
Customers put their sentiments aside and came in to buy the American products that he had stocked up on. “It kind of helped us drive traffic and demand for the inventory that we had, just because people wanted to help,” he said.
But since then, Mutalemwa said he’s been disappointed at the lack of ongoing local support as the boycott against U.S. products continues.
“People are still boycotting at the big chains and box stores. It would have been encouraging for smaller businesses like mine … if they did 30 to 40 per cent of their shopping at local stores. It’s not just about the product that you buy, it’s about the revenue staying with business owners, taxpayers and people who actually live in our community,” he said.
Last month, Quebec’s liquor board said it would destroy about $300,000 worth of U.S. alcohol, such as boxed wines, as the products neared their expiration dates. Mutalemwa said his own store would have had to do the same, as many non-alcoholic products have a shorter shelf life than their alcoholic counterparts.
“Some beverages are pasteurized. Some of them use ingredients that help them stay shelf-stable. Depending on what method was used, that will impact how long it can stay on the shelf … Most of the time, it’s good for 12 months at the point of manufacture, but we’re not getting them right when they’re made. That’s when it becomes more concerning,” he said.
It hasn’t been easy to replace the revenue he had come to expect from the sale of American products.
“We had to work really hard to change our product mix. It’s not that we had a lot of American products. Let’s say, if we were carrying 250 products, the American ones might have only (represented) 10 to 15, but they were among our best-selling brands,” Mutalemwa said.
“When that demand disappeared overnight, you’re left holding this inventory because you thought, ‘I’ve got to stock up, because we sell quite a lot’ … For every (American) spirit I lose, I may have to add five (non-American options),” he said.
On the upside, with continuing consumer interest in non-alcoholic beverages, Mutalemwa said it’s been easy to find Canadian non-alcoholic beers as well as European wine products.
“We do find that a lot of Canadian craft breweries have started making non-alcoholic beers so we have really upped our selection on that side … in terms of imitation of alcoholic products, beers are the furthest along. There are lots of occasions where people can consume beer, but not want to consume alcohol. In the summer, there are the golfers and the cottage-goers,” he said, adding that Ottawa boasts many options from local breweries including Dominion City and Bicycle Craft Brewery.
Not far down the street from Knyota, Ottawa restaurateur Stephen Beckta said all his American wines and spirits are “sitting in a cool, dark place.”
“We are still not selling our U.S. products. I hope that Canada and the U.S. can get back to a better relationship and we can start selling them again at some point,” Beckta said.
Despite removing American alcohol products from his menu, Beckta told OBJ that he has seen an increase in subscriptions for his curated wine business, Curated by Beckta.
“We did see a big uptick in our wine subscriptions and our curated wine case sales, especially around Canada Day. We sold a fantastic amount of Canadian-only wine boxes. I would say that, on average, our Canadian wine sales have increased by about 20 per cent compared to last year. People are very supportive of our homegrown wine industry,” Beckta said.
In March, Beckta told OBJ that he would have pulled his 60-plus American liquor options, regardless of the Ontario liquor board’s decision.
“Most people are very understanding and encouraging of the move. I’m sure (guests) are going to be fine drinking a lovely Canadian rye instead of the bourbon in their old-fashioned for the next little while until the tariff war is over,” he said at the time.
Now, Beckta said his purchasing of Canadian wines has increased by 20 per cent and by a larger margin for Canadian spirits.
“In order to keep our selection large and just from the sentiment, we just want to support our Canadian partners,” Beckta said.
