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Business group says lockdown loopholes hurt small retailers, benefit big box stores


As parts of the country step up restrictions to combat rising COVID-19 cases, some observers say a retail phenomenon is emerging: Lockdown loopholes. 

During the first wave of shut downs, only select retailers deemed essential were permitted to remain open for business. 

This time around, however, efforts to expand the definition of an essential product or retailer have helped keep more stores open.

Yet some business advocates say the retailers that have benefited most tend to be bigger stores with more products from which to be deemed essential.

Dan Kelly, president of the Canadian Federation of Independent Business, said the outcome is that some stores can remain open while similar retailers are forced to close.

"It's creating an unfair playing field," he said Monday. "The trend we see is larger retailers and big box stores are remaining open, while smaller independent stores are closed."

Kelly said while a local bookstore is shuttered, for example, shoppers can still buy books at Walmart and Costco.

"The independent flower shop is fully closed but you can buy fresh flowers at the grocery store," he added.

In the case of Manitoba, which shut down large parts of its economy last week, the answer can be found in the government's public health order.

It lays out the essential goods and services that can continue to operate, including businesses that provide "food or household consumer goods necessary for the safety, sanitation or operation of residences and businesses, such as personal hygiene items, cleaning supplies, baby and child care products, hardware and household appliances."

In other words, if a retailer sells goods that fall into one of those categories, it can continue to operate, whereas if it sells only books or flowers, for example, it would have to close. 

But Diane Brisebois, Retail Council of Canada president and CEO, said the suggestion that lockdowns only hurt small retailers is a "false narrative."

She said the tighter restrictions and lockdowns tend to hurt certain categories of retail – regardless of size. 

"It's a misconception," Brisebois said. "Those who are not considered essential include small, medium and large businesses."

She said an apparel chain may have 30 stores in a province,  for example, but because it's not essential it will remain closed. 

Brisebois said the bigger issue right now is the widespread confusion among both retailers and consumers about what the rules are. 

She said the lack of clear, harmonized rules — even within the same province, in some cases — is leaving shoppers unsure about what's open or closed. 

In addition, Brisebois said many retailers have invested heavily in creating safe and healthy environments for workers and customers.

"They're frustrated because they've made those investments, they've enforced mask-wearing and hand sanitizing, and now they're being forced to close," she said. 

Brisebois said even some businesses that remain open but are operating at a reduced capacity are losing money and facing mounting bills. 

Meanwhile, Kelly said the mood among business owners has changed as the second wave worsens.

In the spring, he said businesses were tolerant of widespread lockdowns because it was a new disease and very little was known about what to do to prevent the spread. 

But Kelly said businesses have now made investments to operate safely, and there is little evidence to suggest that retail has been a major contributor to the spread of COVID-19. 

Brisebois agreed.

"The irony is that all the numbers show the cases that are reported in retail are lower than the cases reported in the general population," she said. "In general, retailers are operating very safe environments."

This report by The Canadian Press was first published Nov. 16, 2020.

Brett Bundale, The Canadian Press

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