Canada Post strike spells trouble for small businesses headed into holiday season

A Canada Post strike that has stopped mail delivery across the country has the small business community scrambling as their busiest selling season gets underway.
Since 55,000 workers at the Crown corporation responsible for ferrying mail went on strike Friday over fair wages and safer working conditions, businesses have been frantically searching for alternative ways to get orders to customers in a timely and affordable manner.
The country’s smallest companies say the longer the strike goes on, the more damage it will cause.
“It is a scramble and a little devastating,” said Jessica Duffield, owner of Wishes & Whatchamacallits, a small business selling pop-culture inspired products.
“Do you pause your shop and lose all of your momentum or do you try and make it work?”
When the strike began, Wishes & Whatchamacallits had about 40 orders to process.
Most of the prints and stickers the Saint John, N.B.-based company sells would usually be sent through Canada Post because it is the most affordable shipping option.
Larger, heavier items such as crewneck sweaters or more customized work like commissions, however, would typically be shipped out via tracked packages for $8 through Canada Post. Sending the same products through other couriers would cost Duffield more than $20 each.
“This week I had to really scramble to figure out … am I going to be absorbing all these extra costs?” Duffield said.
“I can’t contact customers and cancel orders. That would devastate me over the holidays.”
Because many of the alternatives to Canada Post are more costly or won’t track her packages until they reach Halifax, Duffield is contemplating driving 45 minutes across the U.S. border to Maine to drop some of the orders in a mailbox.
”(For) the rest, I probably will have to eat some of that expense by using a courier,” she said.
Many of the small businesses Dan Kelly, president of the Canadian Federation of Independent Business, has spoken with in recent days have told him Canada Post alternatives are two to three times more expensive than they are with the Crown corporation.
Even those that can afford to opt for other services often find capacity issues.
“It’s not like these private sector delivery companies had just massive amounts of surplus capacity, so that is very much a challenge,” said Kelly, whose organization represents more than 97,000 small businesses in Canada.
While many companies swallow the added cost of shipping goods to customers, some of them are also facing another problem: cheques and invoices stuck in the halted mail system.
“There’s still a huge number of businesses paying other businesses, suppliers or their business customers with a paper invoice in the mail,” he said.
“It takes days, sometimes weeks, for that to be sorted out.”
Most small businesses don’t have that much time to spare.
With Black Friday on Nov. 29 and holiday shopping getting underway, they are desperate for solutions that won’t upend their busiest season, when Kelly estimates some small businesses see up to 40 per cent of their annual sales.
OplusN, a Toronto-based purveyor of handmade leather goods, makes about 70 per cent of its sales during this time of year.
“The strike has caused major delays, affecting our ability to fulfil orders on time and impacting customer satisfaction,” said owner Omid Habibi in an email.
To cope, Habibi added a local pickup option, which gives customers a discount if they retrieve their order from the business directly. The company is also making use of a program where e-commerce behemoth Amazon will fulfil some of OplusN’s orders.
“While the fees are high and leave us with minimal profit, it ensures timely deliveries during this critical time,” Habibi said.
Harley Finkelstein, president of Shopify Inc., the e-commerce software giant favoured by small businesses, said a strike two weeks before Black Friday “devastates” small businesses.
“As the leading Canadian carrier, this has massive consequences — small businesses will unfairly bear the brunt,” he said on X, formerly known as Twitter.
Many of these businesses are also worn out. They emerged from COVID-19 only to grapple with labour shortages and inflation and in recent months faced a whipsaw of labour disputes at the Montreal and Vancouver ports that have ratcheted up the cost of doing business and their nerves.
“It’s no surprise to anyone that small firms have been put through the ringer over the last couple of years,” Kelly said.
This report by The Canadian Press was first published Nov. 18, 2024.