Canada Post strike costs businesses over $765M: report

The Canada Post strike has impacted small- and medium-sized businesses to the tune of over $765 million, according to a new report.

About 55,000 employees represented by the Canadian Union of Postal Workers walked off the job on Nov. 15. At issue are wages — the union called for a cumulative wage hike of 24 per cent over four years, while Canada Post has offered an 11.5 per cent increase — job security, benefits and contract work for parcel delivery on weekends.

As the strike nears its third week, small- and medium-sized businesses are losing money.

The Canadian Federation of Independent Business, a non-profit organization, estimates the cost to these businesses is at least $765 million or $76.6 million each business day. It could cost the sector over $1 billion by Wednesday.

“It’s not Grinch who is about to steal Christmas,” said Corinne Pohlmann, executive vice-president of advocacy at the Canadian Federation of Independent Business. “It’s Ottawa sitting idly on the sidelines while small businesses are losing crucial revenue and sales due to circumstances outside of their control.”

Canadian businesses of all sizes also depend on Canada Post to varying degrees, ASI, a non-profit that helps promotional product suppliers and distributors, said in a release last month.

Tierney Culmer, owner of Culmer Pen Company in Mississauga, told ASI its direct-to-consumer orders that are normally delivered by Canada Post will need to be picked up by UPS instead as long as the strike continues.

“We’ll have no choice but to absorb the cost difference,” Culmer said.

The strike has negatively impacted three-quarters of small businesses, the Canadian Federation of Independent Business said.

Among those, 41 per cent reported cost impacts totalling $2,000 in lost orders, more expensive delivery alternatives, late payments and the inability to promote their business at a crucial time of year. Overall, 69 per cent of small business owners want the government to introduce back-to-work legislation.

The federal government has been under pressure to intervene in the strike but has said that’s not in the cards.

Here’s how the strike is impacting some small businesses across the country:

• A bookkeeping service business in Alberta has funds stuck at the post office as the shop’s receivables are all sent via mail from insurance companies.
• For a consulting firm in Ontario, there is no shipping alternative without giving big discounts for clients, forcing the company to pay for all the extra shipping costs.
• A seed supplier in Prince Edward Island, that has been dependent on Canada Post for 86 years, has over 270,000 catalogues that cannot be mailed via a bulk service. Rather than looking forward to increased revenue, it’s now facing substantial storage fees for the large volume of printed materials and says orders for Christmas will be low.

The Canadian Federation of Independent Business is urging Ottawa to immediately intervene and impose binding arbitration or introduce back-to-work legislation to salvage some of the critical holiday shopping season.

“Small firms have already missed the most important sales weekend of the year, with Black Friday, Small Business Saturday and Cyber Monday. If the strike isn’t settled this week, Canada Post will not be a player for the entire holiday season given the backlog it will have to sort through before taking on new business,” Pohlmann added.

Lead photo: Yan Krukau