The low Canadian dollar continues to hurt business who source their product from the U.S.
Montreal-based Dollarama may soon raise is current $3 price maximum to $4. Currently, all items in-store are $3 or less.
CEO Larry Rossy says “The probability is in the third and fourth quarter of next year, we’ll have to move our price points up. In general, we like to maintain our prices as long as we can, but this is really an exceptional time where the Canadian dollar has gone so poorly against the U.S. dollar and everything is bought in U.S. dollars. So to absorb 25 to 35 per cent (in currency swing) is almost impossible.”
Companies such as Dollarama will purchases most items from China for .25 to .35 cents and sell them for $1 to $1.25. However, due to the dollar, China is steadily increasing their prices which is decreasing profit margins.
The change is expected by late 2016.
