Saskatchewan Premier Scott Moe announced yesterday that the Saskatchewan Liquor and Gaming Authority will raise the cost of U.S. liquor sold by the provincial distributor by 50 per cent for retailers on Sept. 8, matching U.S. tariffs on Canadian liquor.
Some say liquor stores, bars, and restaurants buying American booze at the raised rate will not be the only ones claiming the extra cost.
“It’s still to be determined whether it’s going to be reflected once the remaining stock sells out that we’re able to buy,” says Alex Wasylenko, manager of the Sutherland Beer and Wine Store.
“The weeks that follow, that’s gonna be the time to tell what’s gonna happen with the prices on the shelves.”
Wasylenko has been urging people to buy Canadian since the trade war began and said that won’t change in the weeks to come.
“We have to adapt with it because there’s more and more consumers that are changing their choice of products they’d like to buy and they’re showing a greater interest in where their products are coming from,” said Wasylenko.
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Businesses are still open to stocking shelves with U.S. liquor and Wasylenko says he thinks most will continue to.
“If people are set on coming home with a certain product, we will have that for them, but when it comes to the prices it’s still to be determined if that entire 50 per cent is going to be passed along to the customer or how it’s going to be broken up,” said Wasylenko.
He says customers who choose to buy Canadian will likely be influenced by increased costs on top of the rising cost of living.
“Canadians are thinking with their wallet in all their shopping decisions and we’ve seen lots of people that have been changing their regular options based on prices alone,” says Wasylenko.
Economist Jason Childs says U.S. producers may take on some of the costs as customers and businesses become fed up with the markup.
“Some producers have lowered their prices in order to try and maintain that market and to maintain the customer base,” said Childs.
“Once people switch and find a substitute that they like, then you’ve got to get them to switch back again once all the nonsense is over with.”
Childs says a change in customers’ choice of spending will have an impact on business.
“We’ve seen that alcohol sales per capita in Saskatoon and Canada as a whole have started to come down and notably so, right? And so we’ve got this shift that’s happening around alcohol. And I think … what we’re seeing with the U.S. right now might exacerbate that problem,” said Childs.
Some Saskatchewan retailers are also worried customers will simply walk away. Hospitality Saskatchewan president Jim Bence says he has noticed spending patterns are down.
“Some of this we can pass on to the consumer. Some of it we can’t. So we’ll see operators eating the costs,” says Bence.
“We understand as operators that we’ll have to trim our expenses wherever we can, try not to pass on too much of the increases to the consumer and find that balance, so that consumers still feel comfortable with going out, but then not putting them in a position where they might never go out again.”
Bence said no matter how the industry is impacted, he thinks Saskatchewan businesses will be in a better position than they are now.
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