The fate of an Ottawa ice cream shop that saw its fledgling wholesale business abruptly shut down last week reignites debate over the province’s dairy rules and whether they unfairly freeze small businesses .
Owner Marlene Haley was working at Merry Dairy last week when an officer from the Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA) passed by and informed her that she should stop wholesaling immediately or face fines of $1,000 per day.
In less than 24 hours, hundreds of pints distributed at locations across the city were collected and returned, leaving customers’ shelves empty just before a long weekend.
“It just seems absurd,” Haley said. “It kind of punishes the small producer.”
Ontario’s Milk Act allows ice cream manufacturers to sell their products directly to consumers, but prohibits them from wholesale to other businesses unless they hold a dairy plant licence. It’s part of a system called supply management that was put in place to protect Canadian farmers, but some critics say it has stifled innovation and lined the pockets of the privileged few.
Dairy farmer Peter Ruiter bristles at this description.
“I’m terribly upset,” said the owner of Blackrapids Farm in Nepean, Ont.
“A lot of people get caught up in these regulations. People want safe food and these are the regulations we follow.”
The Merry Dairy is not the first local store to break the rules.
Pascale’s All Natural Ice Cream has been making small batch ice cream in Ottawa for over a decade and found itself in an equally sticky situation. He has since focused on vegan options.
When Merry Dairy took to Twitter with a thread explaining what had happened to its wholesale deals, Pascale tweeted in sympathy: “Same story, 3 years later!!! Things have to change.”
In a statement to CBC, an OMAFRA spokesperson said the requirement to have a license under the Milk Act is intended to ensure that companies that distribute dairy products meet “high standards of food” from the province.
The ministry is in contact with Merry Dairy and has offered support for it to become a licensed dairy plant, which would allow the store to resume wholesale operations, the statement added.
Haley said she’s looking at what it would take to become a licensed factory, but suspects the century-old building the store calls home won’t offer enough space to meet the requirements.
The Toronto store spent $250,000
Kaya Ogruce, owner of Toronto-based Death in Venice Gelato, faced a similar situation a few years ago.
As his business was taking off, he discovered that he had to be a licensed factory to wholesale. But unlike many small producers, Ogruce decided to take the plunge.
It was a “mountain” of work, he said, adding that despite devising his own plans and doing much of the work himself, building a factory cost around 250 000 dollars.
Now he undergoes inspections about four times a year and keeps meticulous records of his ice cream orders.
Canada’s dairy regime could not be more punitive for small business in terms of the interests it serves and how it protects those interests. Tonight was us. Who knows who is next and why.
“As a business owner who had a hard time getting that permit, technically I should be on the side of getting the permits,” he said, explaining that it would mean his investment was worth it. sadness.
“But as I was getting this license I really noticed that…the dairy commission, basically I think, is run by the big players and no one wants to give away any of their business [to] stores like us.
Ruiter, the dairy farmer, disagrees with that description, saying he also has to wrestle with layers of bureaucratic rules and pointing out that it was the province, not the dairy commission, that shut down the trade wholesale from Merry Dairy.
“As a dairy farmer, we want artisans making products because it’s another sale for us,” he added.
Wholesale trade increased during COVID-19
Merry Dairy had two wholesale customers before the COVID-19 pandemic began, but as the lockdown spread and other stores started looking for local produce to carry, that number jumped to 15, according to Haley.
While other areas such as liquor rules have changed to help businesses stay flexible and afloat, dairy rules have remained the same.
For Merry Dairy, the addition of wholesale has allowed the store to stay open and employ staff year-round, Haley said, estimating he dispensed 300 to 400 pints each week.
But the dairy rules appear designed for large producers and should be updated with exceptions to allow small local shops, she said.
While Haley understands why a large company shipping pallets of ice cream every day would need strict rules to track their product in the event of a recall, that’s no problem for the Ottawa store, which knows each of its customers personally. clients.
“We have nutrition labels that are about to come out,” she said. “We trace all our batches, we know where they go and what we have sold to each of our customers each week.”
Now those stores will likely find someone else to supply their ice cream, likely a large producer, Haley added.
“I don’t think we’re a threat,” Haley said. “I think there is room for small businesses in the market and for sharing the milk and ice cream market.”
Professor says dairies rule squash contractors
Professor Sylvain Charlebois, director of Dalhousie University’s agri-food analysis laboratory, said he believes supply management has merit, but the dairy industry in particular has left little room for innovation. ‘innovation.
He used the example of eggs, which are also under supply management, but pointed out that backyard chickens are allowed in some places, allowing households to harvest their own.
The dairy industry doesn’t want any competition, and even a case like Merry Dairy could “open a Pandora’s box”, according to the professor, adding that he thinks the dairy industry and government are too closely intertwined.
“Right now, companies like Merry Dairy are being victimized by abuse sanctioned by the Ontario government and the federal government as well.”
Mayor Jim Watson shared news of Merry Dairy’s closure on Twitter, calling on Premier Doug Ford to help the small business and find a compromise that would allow it to continue wholesale.