CHARLOTTETOWN, P.E.I. — COVID-19 has had a devastating effect on revenue for Atlantic Canadian businesses, but it has also raised another problem for businesses that were shut down as a result of the pandemic – too much inventory.
"Folks are getting a six-week tourist season that probably needed three or four months to clear this inventory," said Grant Taylor-Paynter, a project co-ordinator with Cows Inc. in Charlottetown.
Besides the backlog of inventory, Cows has taken a financial hit as a result of COVID-19.
"We went from probably one of our banner years to all of the sudden the door being closed," said Taylor-Paynter, referring to the mid-March week when many businesses shut down due to the coronavirus pandemic.
For Cows, when retail outlets closed, ice creams sales went to zero, and company projects were put on hold, he said. Butter sales increased early on because of the increase in more people working from home and baking. Cheese sales also continued, so the company had two or three people still working in shipping. About 30-40 people, including storefront staff, work at the Cows Creamery in Charlottetown at 12 Milky Way.
The company's revenue has been down about 40 per cent in Canada and 60 per cent lower on P.E.I. compared to last year, he said.
But like many businesses, online sales have increased.
In terms of dealing with excess inventory, Cows is planning to host an outdoor inventory sale Sept. 17-20 at its Milky Way property.
Cows has about $50,000 worth of merchandise it is looking to sell off, such as T-shirts.
The company is currently reaching out to other businesses to see if they'd be interested in setting up in a tent on the property and participating in the event. Ideally, Taylor-Paynter said the company would like three to four large vendors, and some smaller ones, to participate.
Taylor-Paynter hopes there will still be some tourism "bubble" traffic on P.E.I. in September that might be interested in making purchases and bring in some revenue.
"And also for us, to get started to bring inventory levels in line," he added.
The first Cows ice cream retail outlet opened in Cavendish in 1983. Since then, the business has expanded to about a dozen locations in Canada and two franchises in China.
Cows currently has about 250 people working at its retail outlets across Canada, which is half of what staffing would be during a normal year. With the ongoing uncertainty around COVID-19 and the possibility of another wave in the fall and winter, Taylor-Paynter said the company's plan is to move ahead, "but cautiously." He said the concern is how business will unfold from October to May.
"Currently, in the winter, our big business is in Whistler and in Banff. If things stay open there, that's good for us. If they don't, then it's a big change for us as well. All (extracurricular) spending certainly has been reined in," he said.
