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As rail shutdown looms, business groups warn of dire consequences unless feds step in

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MONTREAL – Hours away from an unprecedented potential shutdown at the country’s two biggest railways, business groups ratcheted up their pleas for Ottawa to step in and prevent a work stoppage that would upend supply chains — while the prime minister stressed a deal at the table is the best outcome.

A phased wind-down at Canadian National Railway Co. and Canadian Pacific Kansas City Ltd. was already near completion Wednesday evening as negotiators struggled to find common ground in contract talks with the Teamsters Canada Rail Conference, with wages and scheduling as key sticking points.

The parties remained in talks into the evening, after CPKC and union representatives sat down separately with Labour Minister Steven MacKinnon in Calgary earlier in the day.

Unless agreements are reached, rail service at both companies is poised to hit the brakes at 12:01 a.m. EDT on Thursday.

Industry groups earlier in the day had urged the government to intervene.

“The federal government must show leadership and act before our trains — and with them, our economy — grind to a halt,” read a joint statement from the Canadian Chamber of Commerce, Business Council of Canada, Canadian Federation of Independent Business and Canadian Manufacturers and Exporters.

“It affects everybody,” said Dennis Darby, CEO of the latter, in a phone interview. “Rail is that primary connection to the ports.

“You can’t roll the dice and say, well, let’s hope they’re going to come up with a plan.”

Under the Canada Labour Code, the federal labour minister can refer the dispute to the Canada Industrial Relations Board for binding arbitration and prohibit a strike or lockout in the interim, the business groups said.

Alternatively, they suggested the government recall Parliament and pass back-to-work legislation — a step taken by a previous Conservative government during a rail strike in 2012, and a move it threatened to make in 2015.

Prime Minister Justin Trudeau urged the parties on Wednesday to hammer out a deal themselves rather than rely on federal intervention.

“My message has been straightforward. It is in the best interest of both sides to continue doing the hard work at the table to find a negotiated resolution,” he told reporters in Ottawa.

“Millions of Canadians, workers, of farmers, of businesses right across the country are counting on both sides to do the work to get a resolution.”

A stoppage by 9,300 engineers, conductors and yard workers at CN and CPKC would mark the first-ever simultaneous shutdown at the country’s main railroad operators.

Their trains haul a combined $1 billion worth of freight per day, ranging from cars and clothes to salt and cement, according to the Railway Association of Canada.

“The knock-on effects would be a multiple of that,” said Ulrich Paschen, a business instructor at Kwantlen Polytechnic University, noting that the goods hauled are used in turn to make other products, from flour to furniture.

“It would start trickling down to consumers pretty quickly.”

Industries hit hardest would include agriculture, mining, energy, retail, automaking and construction.

Some workers are already feeling the impact.

Conifex Timber said 250 employees will be affected as it cuts the operating schedule at its sawmill in Mackenzie, B.C., to one shift per day from two, starting on Monday.

Chief operating officer Andrew McLellan said the move, which will last “for the foreseeable future,” stems from the shutdown on new rail shipments coupled with poor market conditions.

“There’s not a whole bunch of trucks around that are available to move the volume that we require,” said Ken Shields, the company’s chairman and CEO, in a phone interview.

“And the trucking rates are much more expensive, so it’s a money-losing proposition to substitute truck deliveries for rail deliveries.”

Both railways have issued lockout notices for a minute past midnight on Thursday, while the union has served a strike notice to CPKC that would kick in at the same time.

Canadian Pacific barred virtually all new shipments on Tuesday morning, and CN did the same Wednesday to avoid leaving any goods stranded on the tracks.

Ports fear containers will pile up on the docks as cargo goes unmoved, causing congestion down the line and prompting some carriers to reroute to U.S. terminals.

Victor Pang, chief financial officer at the Vancouver Fraser Port Authority, pointed to the 13-day strike by 7,400 B.C. dockworkers last summer as a cautionary tale. Manufacturers said the job action blocked the flow of $500 million worth of goods each day.

“The kind of disruption that we had back in July, it took us multiple months to clear out,” Pang said.

The number of vessel arrivals at the Port of Vancouver — the country’s biggest — has already fallen 22 per cent over the past four weeks as shippers sought to steer clear of potential disruptions, according to supply chain platform Everstream Analytics.

Quebec deputy premier Geneviève Guilbault pegged responsibility for a possible rail halt on the prime minister, calling on Trudeau to “have the courage to take action” if no deal was reached by Thursday. Deputy Prime Minister Chrystia Freeland pointed to the railways and union, saying that “they need to take their responsibilities seriously.”

More than 32,000 rail commuters across the country will also have to find new routes to the office if a work stoppage occurs at CPKC.

Transit authorities have said select commuter lines that run on Canadian Pacific tracks in Toronto, Montreal and Vancouver will be suspended should dispatchers walk off the job.

The commuter lines affected by the potential work stoppage are TransLink’s West Coast Express in the Vancouver area, Metrolinx’s Milton line and the Lakeshore line’s Hamilton GO station in the Greater Toronto Area, and Exo’s Candiac, Saint-Jérôme and Vaudreuil/Hudson lines in the Montreal area.

Riders on Via Rail’s 480-kilometre Sudbury-White River line, which runs three times a week in northern Ontario, would also be out of luck.

Retailers are worried about the ripple effects as well.

“Product is not being loaded onto various forms of transportation because of the expectation that it could just get backlogged and stuck,” said Michelle Wasylyshen, a spokeswoman at the Retail Council of Canada.

“We’re looking at holiday shopping products, Halloween products, even food items.”

This report by The Canadian Press was first published Aug. 21, 2024.

Companies in this story: (TSX:CNR, TSX:CP)

— With files from Tara Deschamps in Toronto, Nojoud Al Mallees in Outaouais, Que., and Aaron Sousa in Edmonton

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Looking for the next mystery bestseller? This crime bookstore can solve the case

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WINNIPEG – Some 250 coloured tacks pepper a large-scale world map among bookshelves at Whodunit Mystery Bookstore.

Estonia, Finland, Japan and even Fenwick, Ont., have pins representing places outside Winnipeg where someone has ordered a page-turner from the independent bookstore that specializes in mystery and crime fiction novels.

For 30 years, the store has been offering fans of Agatha Christie’s Hercule Poirot or Arthur Conan Doyle’s Sherlock Holmes a place to get lost in whodunits both old and new.

Jack and Wendy Bumsted bought the shop in the Crescentwood neighbourhood in 2007 from another pair of mystery lovers.

The married couple had been longtime customers of the store. Wendy Bumsted grew up reading Perry Mason novels while her husband was a historian with vast knowledge of the crime fiction genre.

At the time, Jack Bumsted was retiring from teaching at the University of Manitoba when he was looking for his next venture.

“The bookstore came up and we bought it, I think, within a week,” Wendy Bumsted said in an interview.

“It never didn’t seem like a good idea.”

In the years since the Bumsteds took ownership, the family has witnessed the decline in mail-order books, the introduction of online retailers, a relocation to a new space next to the original, a pandemic and the death of beloved co-owner Jack Bumsted in 2020.

But with all the changes that come with owning a small business, customers continue to trust their next mystery fix will come from one of the shelves at Whodunit.

Many still request to be called about books from specific authors, or want to be notified if a new book follows their favourite format. Some arrive at the shop like clockwork each week hoping to get suggestions from Wendy Bumsted or her son on the next big hit.

“She has really excellent instincts on what we should be getting and what we should be promoting,” Micheal Bumsted said of his mother.

Wendy Bumsted suggested the store stock “Thursday Murder Club,” the debut novel from British television host Richard Osman, before it became a bestseller. They ordered more copies than other bookstores in Canada knowing it had the potential to be a hit, said Michael Bumsted.

The store houses more than 18,000 new and used novels. That’s not including the boxes of books that sit in Wendy Bumsted’s tiny office, or the packages that take up space on some of the only available seating there, waiting to be added to the inventory.

Just as the genre has evolved, so has the Bumsteds’ willingness to welcome other subjects on their shelves — despite some pushback from loyal customers and initially the Bumsted patriarch.

For years, Jack Bumsted refused to sell anything outside the crime fiction genre, including his own published books. Instead, he would send potential buyers to another store, but would offer to sign the books if they came back with them.

Wendy Bumsted said that eventually changed in his later years.

Now, about 15 per cent of the store’s stock is of other genres, such as romance or children’s books.

The COVID-19 pandemic forced them to look at expanding their selection, as some customers turned to buying books through the store’s website, which is set up to allow purchasers to get anything from the publishers the Bumsteds have contracts with.

In 2019, the store sold fewer than 100 books online. That number jumped to more than 3,000 in 2020, as retailers had to deal with pandemic lockdowns.

After years of running a successful mail-order business, the store was able to quickly adapt when it had to temporarily shut its doors, said Michael Bumsted.

“We were not a store…that had to figure out how to get books to people when they weren’t here.”

He added being a community bookstore with a niche has helped the family stay in business when other retailers have struggled. Part of that has included building lasting relationships.

“Some people have put it in their wills that their books will come to us,” said Wendy Bumsted.

Some of those collections have included tips on traveling through Asia in the early 2000s or the history of Australian cricket.

Micheal Bumsted said they’ve had to learn to be patient with selling some of these more obscure titles, but eventually the time comes for them to find a new home.

“One of the great things about physical books is that they can be there for you when you are ready for them.”

This report by The Canadian Press was first published on Sept. 15, 2024.



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Labour Minister praises Air Canada, pilots union for avoiding disruptive strike

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MONTREAL – Canada’s labour minister is praising both Air Canada and the union representing about 5,200 of its pilots for averting a work stoppage that would have disrupted travel for hundreds of thousands of passengers.

Steven MacKinnon’s comments came in a statement shared to social media shortly after Canada’s largest air carrier announced it had reached a tentative labour deal with the Air Line Pilots Association.

MacKinnon thanked both sides and federal mediators, saying the airline and its pilots approached negotiations with “seriousness and a resolve to get a deal.”

The tentative agreement averts a strike or lockout that could have begun as early as Wednesday for Air Canada and Air Canada Rouge, with flight cancellations expected before then.

The airline now says flights will continue as normal while union members vote on the tentative four-year contract.

Air Canada had called on the federal government to intervene in the dispute, but Prime Minister Justin Trudeau said Friday that would only happen if it became clear no negotiated agreement was possible.

This report from The Canadian Press was first published Sept. 15, 2024.

Companies in this story: (TSX:AC)

The Canadian Press. All rights reserved.



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As plant-based milk becomes more popular, brands look for new ways to compete

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When it comes to plant-based alternatives, Canadians have never had so many options — and nowhere is that choice more abundantly clear than in the milk section of the dairy aisle.

To meet growing demand, companies are investing in new products and technology to keep up with consumer tastes and differentiate themselves from all the other players on the shelf.

“The product mix has just expanded so fast,” said Liza Amlani, co-founder of the Retail Strategy Group.

She said younger generations in particular are driving growth in the plant-based market as they are consuming less dairy and meat.

Commercial sales of dairy milk have been weakening for years, according to research firm Mintel, likely in part because of the rise of plant-based alternatives — even though many Canadians still drink dairy.

The No. 1 reason people opt for plant-based milk is because they see it as healthier than dairy, said Joel Gregoire, Mintel’s associate director for food and drink.

“Plant-based milk, the one thing about it — it’s not new. It’s been around for quite some time. It’s pretty established,” said Gregoire.

Because of that, it serves as an “entry point” for many consumers interested in plant-based alternatives to animal products, he said.

Plant-based milk consumption is expected to continue growing in the coming years, according to Mintel research, with more options available than ever and more consumers opting for a diet that includes both dairy and non-dairy milk.

A 2023 report by Ernst & Young for Protein Industries Canada projected that the plant-based dairy market will reach US$51.3 billion in 2035, at a compound annual growth rate of 9.5 per cent.

Because of this growth opportunity, even well-established dairy or plant-based companies are stepping up their game.

It’s been more than three decades since Saint-Hyacinthe, Que.-based Natura first launched a line of soy beverages. Over the years, the company has rolled out new products to meet rising demand, and earlier this year launched a line of oat beverages that it says are the only ones with a stamp of approval from Celiac Canada.

Competition is tough, said owner and founder Nick Feldman — especially from large American brands, which have the money to ensure their products hit shelves across the country.

Natura has kept growing, though, with a focus on using organic ingredients and localized production from raw materials.

“We’re maybe not appealing to the mass market, but we’re appealing to the natural consumer, to the organic consumer,” Feldman said.

Amlani said brands are increasingly advertising the simplicity of their ingredient lists. She’s also noticing more companies offering different kinds of products, such as coffee creamers.

Companies are also looking to stand out through eye-catching packaging and marketing, added Amlani, and by competing on price.

Besides all the companies competing for shelf space, there are many different kinds of plant-based milk consumers can choose from, such as almond, soy, oat, rice, hazelnut, macadamia, pea, coconut and hemp.

However, one alternative in particular has enjoyed a recent, rapid ascendance in popularity.

“I would say oat is the big up-and-coming product,” said Feldman.

Mintel’s report found the share of Canadians who say they buy oat milk has quadrupled between 2019 and 2023 (though almond is still the most popular).

“There seems to be a very nice marriage of coffee and oat milk,” said Feldman. “The flavour combination is excellent, better than any other non-dairy alternative.”

The beverage’s surge in popularity in cafés is a big part of why it’s ascending so quickly, said Gregoire — its texture and ability to froth makes it a good alternative for lattes and cappuccinos.

It’s also a good example of companies making a strong “use case” for yet another new entrant in a competitive market, he said.

Amid the long-standing brands and new entrants, there’s another — perhaps unexpected — group of players that has been increasingly investing in plant-based milk alternatives: dairy companies.

For example, Danone has owned the Silk and So Delicious brands since an acquisition in 2014, and long-standing U.S. dairy company HP Hood LLC launched Planet Oat in 2018.

Lactalis Canada also recently converted its facility in Sudbury, Ont., to manufacture its new plant-based Enjoy! brand, with beverages made from oats, almonds and hazelnuts.

“As an organization, we obviously follow consumer trends, and have seen the amount of interest in plant-based products, particularly fluid beverages,” said Mark Taylor, president and CEO of Lactalis Canada, whose parent company Lactalis is the largest dairy products company in the world.

The facility was a milk processing plant for six decades, until Lactalis Canada began renovating it in 2022. It now manufactures not only the new brand, but also the company’s existing Sensational Soy brand, and is the company’s first dedicated plant-based facility.

“We’re predominantly a dairy company, and we’ll always predominantly be a dairy company, but we see these products as complementary,” said Taylor.

It makes sense that major dairy companies want to get in on plant-based milk, said Gregoire. The dairy business is large — a “cash cow,” if you will — but not really growing, while plant-based products are seeing a boom.

“If I’m looking for avenues of growth, I don’t want to be left behind,” he said.

Gregoire said there’s a potential for consumers to get confused with so many options, which is why it’s so important for brands to find a way to differentiate themselves, whether it’s with taste, health, or how well the drink froths for a latte.

Competition in a more crowded market is challenging, but Taylor believes it results in better products for consumers.

“It keeps you sharp, and it forces you to be really good at what you’re doing. It drives innovation,” he said.

This report by The Canadian Press was first published Sept. 15, 2024.



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