Northern Maine businesses feel Canadian crunch

FORT KENT — The number of Canadians on Main Street in any Maine town along the U.S.-Canadian border is at an all-time low, and some local merchants believe the Canadian shopper should be put on the endangered-species list.

The devalued Canadian dollar is making it hard for Canadians to come to Maine to shop or to visit as tourists. On the other hand, the devalued dollar makes it a “bon marche,” or a good deal, for Americans to shop and vacation in Canada.

Ellery Labbe, who is retired but still helps out at the family business, Nadeau’s Furniture in Fort Kent, said Canadians used to account for 40 to 50 percent of sales. He was at the store Thursday and said the absence of Canadians was deafening.

“It’s unreal,” said Labbe. “We see very few Canadians. You could say we don’t see Canadians on Main Street anymore. This exchange rate is ridiculous. It’s closing businesses on Main Street.”

The value of the Canadian dollar and the number of Canadians walking on Main Street in Fort Kent have a direct relationship. This week, while the value of the Canadian dollar is at its lowest in Canada’s 140-year history, Canadians have nearly vanished from Fort Kent.

For the past several weeks, the St. John Valley Times, a weekly paper based in Madawaska, has been carrying a majority of Canadian sales inserts with the Wednesday paper. This week, the paper had five inserts; four of them were for a Canadian pharmacy and Canadian stores selling groceries and furniture.

On Monday, the Canadian dollar hit its lowest exchange rate ever at 66.51 cents against the American dollar. The decline continued during the week, and by Wednesday night, the dollar was trading at 66.39 cents to the U.S. dollar.

In Edmundston, New Brunswick, across the border from Madawaska, it was costing Canadians $1.536 to purchase one U.S. dollar Thursday morning at the local branch of the Royal Bank of Canada. Americans needing Canadian money were getting $1.488 Canadian for each of their American dollars.

Labbe, like many other businessmen, is frustrated.

“Politicians in Augusta and Washington don’t seem to care,” he said. “I don’t know if Americans shopping in Canada are paying Maine sales taxes on the products they buy in Canada.

“It’s frustrating for merchants. We have people who buy vegetables, furniture and tools in Canada, and they come and sell it here from the church yard, and there’s nothing we can do.

“It’s not funny any more. Aroostook County will close up if this exchange rate keeps going,” he predicted.

Labbe is not alone.

Tim Lausier operates Bob’s Service Center in Madawaska, where business also has been hurt by the exchange rate.

“When Canadians stop coming, we lose,” Lausier said. “Our traffic is down. We are trying to ride out the storm, but we have been hurting for several years now.”

Gas, milk and other smaller commodities are Lausier’s stock in trade. “When traffic is low, the turnout is low,” he said. “Gas is a big part of our business. We can’t bring up the pump price because the competition is not bringing it up, and we take the loss at the present exchange rate.”

Paul Beaulieu operates Jackie’s Bar in Madawaska. “I don’t know where to turn any more,” he said. “Canadians don’t come across because the Canadian price of our beer and drinks is nearly equal to the cost of beer in Canada. They stay home.”

A bottle of beer which sells for $2 in American currency sells for $2.75 in Canadian money at Beaulieu’s establishment. He loses money on the exchange rate but feels he can’t charge more.

“We depend on Canadians for 60 percent of our business,” he said. “It’s not there any more. Our profit margin is getting smaller and smaller. We could be priced out of the market soon.

“Of course, it bothers us,” Beaulieu said of the exchange rate.

Michelle Dube, executive director of the Greater Madawaska Chamber of Commerce, said Madawaska is “losing a lot of business to Canada. People from here shop in Canada where the American dollar is worth so much more.

“We don’t have the tourists we used to have because Canadians are staying in Canada and Americans are going to Canada,” Dube said.

Gerry Robinson of the Greater Fort Kent Chamber of Commerce said, “Everyone’s concerned. This is really impacting our businesses. People are telling me they shop in Canada to make their dollar stretch.

“Our merchants are feeling the crunch. Sales have dropped. Some are holding on, but we wonder for how much longer. This has been going on for years.”

Robinson said he thought “Canadians are doing that [devaluing their dollar] on purpose. It’s good for tourism. It’s helping their economy by bringing the American money.”

Labbe pointed out he has been in business for 23 years.

“The last five years have been murder,” he said. “I’m glad we don’t have mortgage payments to make because we have had to cut the markup on all of our products.”