Here’s How Canadian Boutiques Are Protecting Themselves from Tariffs

As the threat of increased tariffs from the United States becomes more of a depressing reality, Canadians across the country are adjusting to a period of ongoing economic uncertainty. For owners of Canada-based boutiques that carry American designers, the situation presents its own set of unique challenges.

In response to the U.S.’s recently imposed tariffs on Canadian exports (25 per cent on goods and 10 per cent on energy), on March 4, the Canadian government enacted a 25 per cent tariff on $30 billion in products imported from the U.S., including most American apparel, footwear and cosmetics.

If you’re confused about why the Canadian government is enacting an additional tariff on American goods entering Canada — which will only increase prices for everyday Canadians — here’s what we know: These new measures are an attempt to deter Canadian businesses and consumers from purchasing American products, with the eventual goal of the American government lifting the tariff policy.

Christina McDowell, the Creative Director of Clementine’s, a luxury boutique in downtown Toronto, is among the hundreds of Canadian boutique owners who are pivoting their business strategies in response to these price increases. When the U.S. tariffs on Canada were first announced, McDowell immediately paused all new orders from the several American designers that she’s historically shopped from — some of which she’s carried since her store opened over 10 years ago.

“As soon as [Trump] started talking about imposing tariffs on an ally like us, I just thought, ‘This is bizarre,’” she says. “The idea of imposing unnecessary tariffs on your closest trading partner was enough for us to make the decision we did.”

Chantal Biro, owner of Ottawa-based womenswear boutique schad, is taking a similar approach. She’s begun to order less from the eight American designers she normally carries, but she’s hesitant to stop ordering from them entirely.

“Up until this nonsense from Trump, it was a good thing to buy American brands because the quality was there and people were paid good wages,” Biro explains. “It’s such a flip, and it’s so hard to get our minds around it.”

Biro also notes that she often works with Canadian distributors to import American brands, which has helped to reduce the amount of tariffs she’s had to pay in the past. However, she’s unsure if these new tariffs will disrupt her current arrangement. As for the American brands that she would typically buy directly from U.S. distributors? Those were the first she decided to do away with.

Winnipeg-based business advisor Jenifer Bartman is urging boutique owners to start taking a closer look at their financial records and spend more time discerning what customers actually want. “You really have to understand your margins,” Bartman says. “You need to know if this increase in costs is something you can bear or if it’s something you’ll have to pass on to customers either in full or in part.”

Shop Vincent, another Ottawa-based boutique run by two sisters, Amanda Papalia and Angie Cambareri, is taking a more reluctant approach to implementing any concrete changes to their business strategy just yet. Out of the 30 brands they currently carry, 15 are American, which accounts for a significant portion of their revenue.

In addition to the financial aspect, they’re also hesitant to cut ties with long-time American business partners, something they don’t feel is fair to do. Instead, they’re working with their American partners on an individual level to ensure price increases don’t get passed down to their customers.

“Some of our U.S. brands are family-run, and we’ve been carrying them for over 12 years. We talk all the time and we know their kids. It’s not just a brand — it’s a relationship,” says Cambareri. “You don’t want to break up with someone because someone else is telling you to, which is what this feels like.”

Both McDowell and Biro are in the same position with their long-time designers, many of whom will be impacted greatly by these tariffs. “They didn’t ask for this, so perhaps it’s on them to put pressure on their government to realize the impact on big and small businesses,” says McDowell.

Although it’s certainly a challenging time, these newly-imposed tariffs have prompted shop owners to shine an even brighter light on the versatility of their offerings — specifically on their Canadian brands. For Biro, highlighting local brands that consistently perform well in-store, like SMYTHE, is a top priority.

Across the board the sentiment is clear — it’s more important than ever to shop Canadian.

“We can’t give American up completely, but where we can find a Canadian or European substitute, we will,” says Biro.

Between a seemingly never-ending supply of trade war talk and political drama on both sides of the border, these boutique owners have been on high alert as they adjust to this new normal. But this challenging time is also a reminder of their resilience. “You have to really love what you do in a small business because we’re always inundated with a variety of issues. Whether it’s something as dramatic as COVID or now with tariffs, we’re always bobbing and weaving, and it’s just important to be able to pivot,” says McDowell. “This has certainly energized the Canadian spirit.”