A Canadian brewery, Tinhouse Brewing Company, located in Port Coquitlam, Canada, is strategically pivoting towards local sourcing and sales as a direct response to the implementation of tariffs, echoing concerns and adaptations seen across various sectors amidst evolving global trade policies. Phil Smith, the co-owner and head brewer at Tinhouse Brewing, shared insights into these shifts, just two months into the new tariff regime.
Smith notes a discernible trend: “There’s a shift towards buying Canadian, buying local, supporting local businesses.” This observation, while positive for domestic sales, is juxtaposed against the broader challenges posed by international trade disputes. The brewery has witnessed an uptick in local patronage, with “an increase in business” and “new faces” frequenting their establishment, suggesting a segment of consumers are deliberately choosing local products.
However, the impact of tariffs extends beyond consumer behavior, directly affecting the brewery’s supply chain. Aluminum, a critical component for beverage cans, presents a significant challenge. While Canada is a major global producer of raw aluminum, the infrastructure for rolling and can manufacturing is not as developed domestically. Historically, Tinhouse Brewing sourced aluminum cans from the United States. Now, with tariffs in effect, Smith indicates a necessary shift to alternative markets, stating, “in this case, we’ll just shift to the Chinese market. That’s the other source for cans.” This pivot highlights the ripple effects of tariffs, forcing businesses to re-evaluate established supply chains and potentially seek alternatives in different global markets, impacting trade dynamics and potentially currency exchange considerations, including the dollar euro relationship in international trade.
The tariffs are anticipated to impact their customer base as well. Tinhouse Brewing has historically welcomed American customers, drawn to their Canadian brews. Smith anticipates a decline in this segment, saying, “I suspect we’ll lose a substantial amount of that business.” The crucial question is whether the increase in local business will offset this loss. Smith remains cautiously optimistic but acknowledges the uncertain economic landscape, stating, “I suspect in the end, all of this is going to be a net loss for everybody: Small business, big business, the consumer. Yeah, it’s the unfortunate part of a trade war.” This sentiment reflects a wider concern within the business community regarding the potentially detrimental effects of trade conflicts on various stakeholders. The fluctuating dollar euro exchange rates, often sensitive to trade policy changes, add another layer of complexity to international business operations.
Despite sourcing 80 percent of their beer ingredients locally, specialty brews like their German lager necessitate importing materials from Germany. This reliance on international imports, even for specific products, underscores the interconnectedness of global trade and how tariffs can create friction. For businesses navigating these changes, real-time financial news and analysis, such as that provided by Yahoo Finance and similar platforms, becomes crucial for understanding market fluctuations and making informed decisions.
Tinhouse Brewing, having navigated the challenges of opening just before the COVID-19 pandemic, demonstrates resilience. While Smith does not foresee closure due to tariffs, concerns about the bottom line are evident. The situation encapsulates the broader economic implications of tariffs, beyond immediate price increases, touching upon supply chain adjustments, market access, and shifts in consumer behavior. The evolving trade landscape necessitates businesses to be agile, adaptable, and informed, closely monitoring economic indicators and global financial news to navigate these turbulent times effectively.
