Ontario's New Lockdown Rules Allow Amazon, Costco, Walmart To Rule The Retail Roost: CFIB

One of the country’s most prominent business groups is criticizing Ontario’s new lockdown rules, which it says will allow big-box stores like Costco and Walmart, as well as e-commerce giant Amazon, to “rule the retail roost” while jeopardizing the existence of small shops.

But the province says big retail chains are in a better position to handle commerce during a pandemic.

Among Ontario’s new restrictions , meant to tamp down escalating COVID-19 infections, is a mandatory 8 p.m. closing time for all retailers, with the exception of “stores that primarily sell food, pharmacies, gas stations, convenience stores, and restaurants for takeout or delivery.”

The new rules mean that any store which sells a full complement of groceries such as Walmart and Costco will be allowed to stay open past 8 p.m. for curbside pickup and delivery, while Amazon will be able to make deliveries past that time. Smaller retailers will be forced to stop, the CFIB said.

“How this will help stop the spread of COVID-19 is anyone’s guess,” CFIB president Dan Kelly said in a statement.

Watch: 6 tips to shop local and support small businesses. Story continues below.

Premier Doug Ford’s office defended the decision, arguing the point is to limit the number of stores Ontarians visit when they leave home for essential purposes.

“With strict safety measures and capacity limits, big box stores provide the public with one-stop shop options. Additionally, in many regions of the province, Ontarians don’t have easy access to online shopping and rely on the convenience and relative affordability of big box retailers,” the premier’s office said in a statement to HuffPost Canada.

“More abilities have been given to Walmart, Costco and Amazon to basically continue to reign the retail roost while small businesses are once again rusting in the dust,” Julie Kwiecinski, CFIB’s director of provincial affairs for Ontario, told HuffPost Canada. 

Kwiecinski said her organization had floated many alternative proposals that would have allowed smaller retailers to stay open, including strict customer limits in stores and even health screenings of customers. 

The CFIB says it also floated the idea of cordoning off non-essential sections of big-box retailers, as Manitoba has done, or simply stopping sales of non-essential items at the cashier. Kwiecinski says the province rejected both ideas.

Blocking off non-essential items has been tried in some jurisdictions, but the practice often came under ridicule on social media, with shoppers questioning why they should be able to buy some items in a store and not others, on account of a pandemic.

Big retailers boom amid pandemic

Many consumer advocates have grown worried about the dominance of big-box retailers during the pandemic, which have seen sales soar during lockdowns, with other retailers and restaurants shut down. 

Amazon’s share price has soared 65 per cent over the past year, making its CEO and co-founder Jeff Bezos, the first person ever officially to reach US$200 billion in wealth . 

But it’s been a different story for small and independent businesses. In a report issued Wednesday, economists at TD Bank warned Canada can expect to see a wave of business closures ahead, with many businesses particularly small and medium sized ones “in a life or death situation.”

Many businesses will have a harder time surviving the second wave of pandemic lockdowns, as they were already in bad shape to begin with, and of those businesses that survive, many will be struggling with large debt burdens that will limit their growth, economists Beata Caranci and Ksenia Bushmeneva wrote.

The CFIB estimates that 150,000 business in Canada will shut down as a result of the pandemic lockdowns, with 90,000 of those in Ontario.

“Only time will show the true rate of business survivorship and scarring, which will only become evident when temporary financial supports recede along with the pandemic,” the TD economists wrote.

“Significant business exits during the pandemic will leave a void that will need to be filled by new businesses once the crisis is over. Elevated personal saving and lower commercial rents should help new businesses to start on a solid footing.”

Other business groups took a more welcoming tone to Ontario’s new rules. The Ontario Chamber of Commerce (OCC), which is more focused on large businesses, said the best thing for business is to get the virus under control.

“Government efforts need to be focused squarely on improved tracking and tracing, rapid testing, speeding up the current vaccination roll-out and getting support to those who need it most so we can get the province re-opened and back on the path of economic recovery,” OCC president and CEO Rocco Rossi said in a statement .