Although everyone understands that supporting Canadian-made products may cost a bit more, if these brands quietly raise prices after seeing an increase in demand, it inevitably feels heart-wrenching - where exactly does this support for domestic goods go?
Source: Global News
According to CBC reports, in recent weeks, the investigative consumer program Marketplace has received dozens of letters from consumers asking whether they are paying higher prices when purchasing "Canadian-made" products.
On Reddit, a user posted a thread questioning: "I want to conduct an investigation to see if 'buying Canadian products' is just another flashy marketing strategy." Many others have reported that the prices of these Canadian brands seem to be increasing every week.
To address this, CBC Marketplace conducted a price analysis on thousands of products labeled as "Canadian" at a Loblaws supermarket in downtown Toronto since the beginning of the year.
The results showed that 90% of the product prices remained unchanged, about 2% of the products saw a decrease in price, but since the official call to purchase Canadian brands, hundreds of products experienced regular price increases, including some of the most representative Canadian brands such as Tim Hortons, St Hubert, Swiss Chalet, and Chapman’s.
Source: CBC
Is the rise in prices due to a surge in demand for domestic products, or is it caused by factors such as costs, processing levels, or U.S. tariffs?
However, Colin Mang, an assistant professor of economics at McMaster University, pointed out that recently there has been a clear increase in Canadians' tendency to buy domestic products.
According to a survey conducted by Nielsen on behalf of Dalhousie University involving 9,788 Canadians, approximately 60% of respondents were willing to pay more for Canadian goods than for American ones. This undoubtedly provides retailers with opportunities to raise prices.
January saw a sharp increase in searches for "Canadian-made" products. Source: CBC
As one of the most representative retailers in Canada, Loblaw owns several common grocery brands, including Loblaws, No Frills, Real Canadian Superstore, Shoppers, and many popular T&T stores among Chinese customers.
In its statement on February 2, the company displayed maple leaf logos both online and offline to inform consumers whether a product was made in Canada.
Source: CBC
During the period from February 3 to February 10, Marketplace found that multiple Tim Hortons products at Loblaws gradually increased in price. For example, the price of a hot chocolate mix (hot chocolate mix) rose from 15.99 CAD to 17.99 CAD, and surprisingly, the same product also experienced two price hikes on Sobeys' delivery platform, Voilà.
In addition, two different-sized French vanilla cappuccino mixes at Loblaws increased by 0.50 CAD and 1 CAD respectively; on March 31, the caramel toffee coffee pods (caramel toffee coffee pods) on Voilà also increased from 12.99 CAD to 13.49 CAD.
Michael von Massow, a professor of food economics at the University of Guelph, said that the timing of these price hikes was "not good." He pointed out that the rise in coffee prices was mainly due to the devaluation of the Canadian dollar and the impact of climate change on coffee production, leading to issues with yields.
However, Mang believes that supermarkets are raising prices because of increased consumer demand - in fact, during the period when prices were raised in February, the price of cocoa beans (used to make hot chocolate powder) was actually declining; although transportation costs had a slight increase, overall wage levels remained unchanged.
Colin Mang, Source: McMaster University
Michael Oliveira, the public relations director of Tim Hortons, told Marketplace in a phone interview that the pricing of products in stores was determined by retailers, not manufacturers.
However, Oliveira did not explain how Tim Hortons determines recommended retail prices or whether these prices have changed. He only emphasized that the raw material costs of coffee and cocoa were at or near historical highs.
Manasvi Thakur, a spokesperson for Sobeys, called the claim that prices are rising due to increased demand for Canadian goods "completely incorrect," pointing out that price fluctuations exist in the cocoa and coffee industries. Thakur added that when suppliers propose cost increases, the company adjusts prices only after going through a full validation process.
In addition to hot chocolate powder and coffee capsules, the following products also increased in price from 7.99 CAD to 8.99 CAD:
- St Hubert chicken pie
- St Hubert Quebec meat pie
- Swiss Chalet chicken pie
Source: St Hubert
Stuart Smyth, a professor in the Department of Agricultural and Resource Economics at the University of Saskatchewan, suggested that this might be more attributable to the growth in Canadian demand, as tariffs do not affect these products.
Von Massow also stated that these products do not require large amounts of imported ingredients and are not subject to high tariffs, though the specific reasons for the price increases are still unclear.
In response, Josée Vaillancourt, a spokesperson for St Hubert and Swiss Chalet, replied in an email that the company had not raised the prices of these products and would not disclose pricing details, calling it "a long-term, comprehensive effort that they take seriously."
Prices in stores are determined by retailers, and most retailers have policies prohibiting suppliers and retailers from discussing retail prices.
The prices of three Chapman’s products also increased: sugar-free vanilla ice cream, vanilla ice cream sandwiches, and double-layer Dutch ice cream. Their prices increased from 7.99 CAD to 8.49 CAD on March 25.
Source: Chapman's
Pascal Thériault, an agronomy and economist at McGill University, explained that ingredient prices such as sugar fluctuate continuously, while Mang noted that other dairy product prices were also rising, which could potentially affect the costs of Chapman’s products.
Von Massow believed that as the weather warms up, the increased demand for ice cream might also lead to higher prices.
When Supporting Domestic Goods, Look at Ingredients
In terms of supporting domestic goods, Thériault reminded consumers that they can try to buy minimally processed ingredients and foods to save money and avoid price fluctuations.
Mang thought that although people are willing to spend more money on these Canadian products, it does not mean they want to see prices rise.
The definition of many "Canadian" labels is also unclear. Jennifer Clapp, a professor at the University of Waterloo, stated that brands meeting the criteria voluntarily label their products as "Made in Canada" (Made in Canada) or "Product of Canada" (Product of Canada). To be classified as "Made in Canada," a product must undergo its final substantial processing in Canada, such as cookies made from both domestic and imported ingredients.
Source: Global News
In addition to the above two labels, brands have many ways to keep information ambiguous. If a product is not made in Canada, companies can still present relevant information in various ways.
Some practices include labeling a product as "Imported for..." (imported for) and attaching the name and address of a Canadian company, making the product appear like pure Canadian manufacturing, or simultaneously marking the name, address of the Canadian company, and the country of origin on the product packaging.
It can be said that buying domestic goods involves so many tricks...
Source: CBC, The Globe and Mail
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