A Strong Dollar, Favorable Exchange, and Lower Costs Drive Canadians to Montana

“The Canadians are coming,” University of Lethbridge Economist Donna Townley said, and they’re already here. A strong Canadian dollar, favorable Canadian exchange rate, and lower costs in Montana are among the factors driving Canadian shoppers south.

Townley spoke to the Kalispell Chamber of Commerce at the Red Lion Hotel in Kalispell, and walking into the hotel the parking lot has several vehicles proving her right as license plates from Alberta, Alberta, Alberta, and British Columbia are parked outside. Townley took the point home during her presentation showing slides of cars parked at major shopping and dining hubs just north of Kalispell.

“Now, everybody know what parking lot that is? Yep- Costco, now, check this out; Saskatchewan, BC, Alberta,” Townley said, “we don’t just shop at Costco, we go across the street to Sportsman,” and to Target, Walmart, eating at Famous Dave’s and HuHot in the shopping district between Whitefish and Kalispell.

“I’ve got six reasons why we come to this valley,” Townley said, “The number one reason is you have something we want, and don’t have. Majestic Montana, you’ve got the trees, the mountains, the lakes.” Townley said retail prices, as well as a lack of sales tax are two of the draws bringing Canadian visitors south from metropolitan areas like Calgary or Lethbridge. The other reasons Townley sites include the time to travel with government holidays and paid vacations, high household incomes, and a strong Canadian dollar.

Townley says the Canadian dollar is a commodities based dollar and it goes up when the price of commodities goes up. For example, oil, Canada’s biggest export. She says as oil prices go up, so does the Canadian dollar.

“To buy the same amount of oil, it takes more Canadian dollars,” Townley said, “when they buy more Canadian dollars, that causes the Canadian dollar to go up in value. So, when commodity prices rise, the Canadian dollar rises, and with the strong market in the commodities that we’re seeing, and that holding steady, the Canadian dollar has a tremendous amount of strength.”

Townley says a few changes are happening at the border to make it more attractive for Canadians to cross. She says about a year and a half ago the value of goods Canadians can bring back home with them, tax free, went up from $250 to $400.

She said the “Beyond the Border” agreement recently signed by President Obama and Canadian Prime Minister Stephen Harper will also help with the flow of visitors across the border by increasing efficiency, with improvements to the Nexus card and cross-border sharing of information. Townley has personal experience with this back and forth across the border because her family has a house in the Flathead Valley, and she says they’re in the area many weekends and much of the summer.

Townley says if businesses want to attract and encourage Canadians to come to their store she recommends polite service, making it easy for Canadians by accepting Canadian currency or debit cards, and it also doesn’t hurt to have a Canadian flag in the stores front window.

 

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