Tobacco Killed The Corner Stores

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Owner, Jay Schultz made a hard decision to close the 40 year old store on May 23, 2015

40 years ago, Eastside Confectionery catered to the growing number of families moving into the “new east end. Back then, the store with it’s iconic Orange Crush sign was a popular stopover for milk, bread and maybe an ice cream for the kids, it was a gathering spot for area children as were many locally owned and family run stores that served every neighbourhood in town.

One of the main revenues for these stores were cigarettes. 40 years ago the stigma surrounding cigarettes wasn’t that what it is today. In Ontario, stores can’t even display smokes out in the open. The crack down on smokers coupled with high hydro rates and higher minimum wage is making keeping the doors open for the small convenience store retailers an almost impossible task.

Jay Schultz, owner of Eastside Confectionery informed staff and patrons that the store will be closing May 23. The Schultz family has operated the store for over forty years starting with his uncle, then with his parents. “I used to live here, it was a house with just a little portion for the store”   Schultz says that was the way most of the little corner stores operated in the day.  The main revenue for the stores were cigarette sales.

“I’m not a smoker and don’t condone it and if there was a way I could not sell them, I would have, but the reality is cigarette sales were the driving force for convenience stores”

Schultz says he and other owners have seen those sales fall off by 90 percent in recent years as more “smoke shacks” popped up on near by First Nation reserves.  “I have to pay 50 percent tax on a carton, then add HST to them, it’s hard to compete with “contraband” smokes that sell for just over 4 bucks a pack on the reserves and I have to charge about $12 a pack.”

Schultz says the native stores now control the majority of all cigarettes sold and cries foul on the federal and provincial governments for creating an unfair playing field.

“Anyone who is selling tax free tobacco is hurting our business and that’s a problem because no one seems to want to do anything about it” Schultz said.”The politicians don’t want to do anything because of who it is (first nation) , I don’t think they see it as illegal because they are selling cigarettes on their land and they are tax free but we have to sell them taxed”

Schultz also points out that promotion of cigarettes with give-a-ways is allowed on first nation lands but not allowed elsewhere giving them the market advantage.

“Our other sales are good including lottery sales but it’s not enough to keep the store open” Schultz said the margins are not great with lottery and other products sold.

To offset the loss of tobacco sales Schultz was hoping that the provincial government would open up beer sales and allow corner stores the opportunity to sell beer however the Liberal government led by Kathleen Wynne recently announced that beer sales would be allowed in the large grocery chains only, leaving the small convenience stores out in the cold.

“There’s been about 20 stores locally that have had to close up” Schultz told saultonline.com.

The news of the closure spread quickly in the east end neighbourhoods,  comments of support on the store’s facebook page show the neighbourhood will miss the store once it closes.

“I’m so sorry to hear this Jay. Many memories from when I was a kid going there for my candy, chips and chocolate bars to working for your mom and dad many years ago.”

“A historic part of our community – you will be missed – let us know what you do next so we can still support our local businesses ( speaking as another local business owner”

“Wow…so many memories. ..worked there for like 15 years…thanks to John and Gloria. ..I put myself through school debt free….got married and bought our first home on that job…so sad….the CRUSH store is an east end monument!” 

Schultz said he hasn’t been able to pull a wage out of the business since the tobacco sales have fallen off and he had to cut staff in recent years, the store employed anywhere from 4 to 8 people in the summertime now the last two remaining staff will be unemployed come May 23.

“A store like this pumps a lot of money into the community through taxes and wages and whatnot and multiply that by the number of stores that have closed  and it’s because the government is not painting an accurate picture of what’s really going on but the government is losing out on about $1.6 billion in taxes, that’s a lot of healthcare money”

As for the future, Schultz said he is going to do what he used to do, graphic design and operate it from the same location.

“I’ll take some time off first and then start it up”

Meanwhile Schultz knows a lot of people are “bummed out” because for a lot of people it was their “childhood store”

“One of the last few “corner stores” we have sad to see them go! First place i ventured to when i moved to the east end 39 years ago!! It was my store and children’s store as long as we lived in the area!!! Thank you for that experience, a short walk from home to get treats with out mom and dad!!! Yes my allowance went there as well!! Good luck in the future!!”

“We held out as long as we could” Schultz said.

 

 

 

 

14 COMMENTS

  1. there’s nothing anyone can really do to help you… There’s so many other stores, gas stations & restraunts all around you that were never there before & they are stealing business. Yes, it’s true. Face it, It’s 2015 sooner than later the bigger company’s like macs etc are going to take over because majority of people don’t look for little convienient stores anymore, they look for the closest location. I agree it’s supper sad, but unfortunately that’s just the way it is.

  2. hes not fully blaming the reserves for everything. He’s just simply stating that out there you can get the same product for cheap and it’s hurting sales. A lot of people don’t realize but tobacco sales a huge portion of the monthly income they make. He also stated that OTHER things were driving prices up. I can see it from both sides of the fence. The taxation on tobacco is outrageous and then on reserves its. “Tax free” and what not, but as a whole it should be regulated on both sides. ( soley my opinion) and I’m not here to bash anything. Just thought there are other ways to put this articles in different perceptions. It’s too bad that it’s closing. It was and still is nice to see little neighbourhood corner stores

  3. It’s pretty sad when you have to blame us as first nations for your loss in sales and the closing of your store….can’t be that there are 2 macs right up the street from you a husky and many gas stations where people go to buy their treats and cigarettes now also holy cow for their ice cream. I read a lot of pointing fingers and blaming native people in this article and nothing about these factors. Sorry for your loss but its a pretty low blow to the first nations people in your community to speak about them this way especially when they are a huge percentage in the sault ste marie population.

  4. I must have bought thousands of hockey cards and stickers from Eastside… Crush in glass bottles… Even rented a couple of classic Star Trek videos there with Mark even though we we something like 12.

  5. Aren’t there 3 Macs around the same area as the store? Sorry to hear about the closing of this business, but Macs were around, taking business, offering more merchandise (besides cigarettes) and located in areas that drew higher foot traffic and is pretty visible, before the increase of First Nation businesses. There are a lot more factors (including increases of minimum wage) then just playing the race card and blaming the local reserves. And some of those “Smoke Stands” and operating businesses also create revenue for SSM’s economies and offer employment to non-natives as well. Just some perspective.

    • Did you not read the whole article? He did say increasing minimum wage is a factor as well.

  6. Again the liberal government screws us again..anyone who votes for those criminals should go to jail too..
    .my teenagers still ride/walk there for treats. Too bad. Good luck my friend

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