Duty-free shops struggle to make ends meet as Canadians steer clear of U.S. 

If business doesn’t pick up soon at his duty-shop, Éric Lapointe says he’s going to have to lay people off. 

“I’ve had three customers today so far,” the store owner told As It Happens host Nil KÓ§ksal on Friday afternoon. “It’s a fraction of what we normally have at this time of the year.”

Lapointe says business is down 60 per cent over the same time period last year at the Boutique Hors Taxes de la Beauce near Quebec’s border with Maine. 

He’s not alone. Duty-free shops across the country, still recovering from pandemic travel restrictions, are reporting massive drops in business in recent months as Canadians increasingly avoid travelling to the U.S.  

Licensed by the the Canada Border Services Agency at 52 land border and international airports in Canada, duty-free stores sell products, including tax-free booze, to cross-border travellers, and are legally unable to pivot to deliveries or online sales. 

“If we have nobody that travels in the U.S., we have no customers,” Lapointe said.

Sales at duty-free stores have fallen between 40 and 50 per cent across the country since late January, with some remote crossings reporting declines of up to 80 per cent, according to the Frontier Duty Free Association, which represents 32 such stores.

“It just dropped off the cliff,” Barbara Barrett, the association’s executive director, said. “It’s very grim.”

The number of return trips among Canadians travelling to the U.S. in March plummeted compared to the previous year, according to Statistics Canada. Air travel dropped by 13.5 per cent while land travel fell 32 per cent.

The drop coincides a pivot to domestic tourism as U.S. President Donald Trump launches a trade war with Canada and other countries, and makes repeated threats to Canada’s sovereignty. 

Several Canadians also told CBC they’ve cancelled trips because they fear heightened scrutiny by U.S. border guards, something the Canadian government has warned travellers about. 

Canadian Jasmine Mooney was recently locked in a U.S. detention facility for 11 days over difficulties with her U.S. visa renewal application, and has since described being kept in harrowing conditions. Two German tourists and a backpacker from Wales have also been detained in recent months. 

What’s more, the dip in cross-border land travel goes both ways. Car visits by U.S. residents dropped 11 per cent last month compared to a year earlier, the second straight month of year-over-year declines.

“It’s like the Americans are shy to come to Canada,” said Philippe Bachand, who runs a duty-free store south of Montreal, pointing to the boos that American sports teams have received in Canada. “It’s not welcoming.”

As duty-free stores get caught in the crosshairs of a trade war and geopolitical tensions beyond their control, the Frontier Duty Free Association is calling on the federal government to offer support in the form of grants or loans to ride out the disruption.

Many of these stores, the association says, are still recovering from pandemic losses. 

“I just woke up from my COVID hangover, and I’m having a tariff nightmare,” John Slipp said while driving to the duty-free outlet in Woodstock, N.B., that his father founded in 1985.

Duty-free shop owner breaks down in tears over struggle to keep business going during trade war

Cameron Bissonnette is afraid he will be forced to close his duty-free shop in Osoyoos, B.C., which has been in his family since the ’80s, and which he had intended to pass onto his children. 

During a recent interview with CBC News, he broke down in tears while discussing the future of his family business, which he says has already dropped from 15 employees to just three. 

“It’s getting to a point where you have to have a real moment of reckoning,” he said.

Osoyoos Mayor Sue McKortoff told CBC that if the shop closes, it will impact the community as well. 

“The duty-free is one of the best businesses in town,” she said. “They’ve been very supportive of the town. They’ve hired people in the town.”

Lapointe, meanwhile, says that if sales don’t pick up over the usually bustling Easter long weekend, he’ll have no choice but to let workers go.

He says he doesn’t want to lose his business, which is dear to his heart.

“I started to work here in 1990 as a student, then I became the assistant manager, then the manager for 20 years and I bought the store three years ago,” he said.

“So for me, that store is my home.”

With files from The Canadian Press and CBC B.C. Interview with Eric Lapointe produced by Leïla Ahouman.