Canada Post Strike Would Hit SMB Ecommerce Shippers

Primarily smaller merchants doing business in Canada are scrambling to get product out the door and set up contingency plans as workers for Canada Post may be on strike as of July 8, according to various media reports.

Canada Post has issued a 72-hour lockout notice to the Canadian Union of Postal Workers (CUPW), meaning a work stoppage that was feared this past weekend may take place on Friday. The parties have been locked in contract negotiations since January, but have failed to come to an agreement.

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Jerry Hempstead, principal of Hempstead Consulting, said there is a different set of rules in Canada vs. the U.S. Postal Service when it comes to collective bargaining, “so it’s possible there will be a real work disruption.”

Hempstead added there is a robust set of alternatives to Canada Post because the vast majority of Canadian citizens live in a select set of metropolitan areas.

One main service option may be Purolator, although there is a question to whether workers for the Canada Post-owned carrier would have to honor a work stoppage. UPS and FedEx also have substantial networks in Canada, as does DHL through a contractor.

UPS said its 900 Access Point locations in Canada are an alternative for shippers and Canadian consumers.

“UPS Access Point locations are situated in convenient places with evening and weekend hours to fit the busy Canadian lifestyle,” said Christoph Atz, president, UPS Canada in a statement. “We are ready for additional volume, and the UPS Access Point Network is robust and prepared to serve Canadians.”

A spokesman for Canada Post said Purolator’s service in Canada should not be disrupted in the event of a work stoppage.

“Because the Canadian business is so concentrated in certain locals there are a myriad of messenger and courier firms that one can drop ship into,” Hempstead said. “So there are sufficient resources to keep shippers doing business there satisfied.”

The effect would mostly be felt by small-to-medium-sized ecommerce shippers, Hempstead said. “But there are lots of great options, especially regionally, to continue operations in Canada,” he added.

Tim Geiken, a principal in supply chain consultancy Platinum Circle Partners, agreed that Purolator remains a question mark. “They don’t have the capacity to pick up the slack, but if their operations are somehow affected or targeted it would be a bigger impact on U.S.-based shippers,” Geiken said.

He added that any postal hybrid operator using Canada Post, the country’s so-called “crown corporation,” for last-mile delivery is going to be directly affected as well by any work stoppage.

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