June 5, 2007 in Business

Businesses ‘loonie’ not to welcome Canadians

Bert Caldwell The Spokesman-Review
 

‘Canadian accepted at par’ used to mean music at Inland Northwest cash registers. Not many remember the tune.

Area retailers and restaurant and hotel operators coveted Canadian dollars when they traded nearly straight up with their American cousins. In the mid-1970s, Canadian was worth more than American, and even as that balance shifted into the early 1980s, most businesses were willing to accept Canadian at par or nearly so as long as visitors from Alberta and British Columbia spent freely.

Parking lots full of provincial license plates were so attractive a prospect that the Post Falls outlet mall, for one, was built in part with a northern windfall in mind.

Cash registers at Harvey’s men’s stores had the exchange rate posted at the registers so employees could make the correct change, recalls Patrick Jones, whose family owned the since-closed chain. Signs welcomed Canadian shoppers.

“That was just a standard part of doing retail,” says Jones, director of the Institute for Public Policy and Economic Analysis at Eastern Washington University.

Harvey’s, particularly the Coeur d’Alene location, did a sizable business with Canadians, he says.

But traffic gradually tailed off with the continued erosion of the Canadian dollar. Even the introduction in 1987 of the $1 coin, the beloved “loonie,” did not turn the tide. Although there was a slight rebound in the early 1990s, by February 2001 the Canadian dollar fell to less than 62 cents American, an all-time low.

Tourists headed north enjoyed fantastic bargains thanks to the wounded loonie, but the falloff in southbound traffic was so pronounced for so long “accepted at par” might as well have meant a gimme 10-foot putt.

The music was gone.

Jones and Harry Sladich, president of the Spokane Regional Convention and Visitors Bureau, say most Inland Northwest businesses seem unaware of the opportunities the resurgent loonie has created.

Some even seem to look upon Canadian money as an inconvenience, says Sladich, who received a complaint from a shopper who tried to tender the currency at a local store.

The clerk’s response? “We don’t take that.”

Clerks barely able to make change for U.S. dollars are helpless if handed a loonie or two, Sladich says.

Yet when he goes north to promote Spokane, he finds cash registers at major establishments pre-programmed to make the conversion. Small businesses have the exchange rate posted for easy reference.

“It’s frustrating we take them for granted,” Sladich says.

Thanks to soaring prices for energy and metals, two of Canada’s major exports, many Canadians enjoy unprecedented wealth, he says. Bulging pocketbooks often led to U.S. shopping junkets, but many of the goods Canadians used to travel south to buy can now be had at home.

Even if they are inclined to head to Spokane or Coeur d’Alene, aggravating border security measures keep many home.

Businesses must do more to make Canadians feel comfortable in Spokane, Sladich says.

He says the CVB is working with a few businesses to prepare a campaign that would make Canadian visitors feel welcome, and raise the area’s profile in Alberta and British Columbia, something the International Trade Alliance and Greater Spokane Incorporated have also tried to do among potential investors and trading partners.

The timing and the approach are still uncertain, Sladich says, but one key might be simply convincing more area banks to accept merchant deposits that contain Canadian currency. Or just having hospitality and retail workers wearing “Welcome Canadians” buttons.

The area may already be making some progress.

Jones drives to and from work on Division, and makes a habit of tracking the number of Canadian license plates. “I definitely see more,” he says.

Jones, who anticipated a stronger loonie, nevertheless was surprised by predictions that parity against the U.S. dollar may be just months away.

Maybe it’s time to cue up the music.

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