On a Monday morning, empty cardboard boxes for clothing are scattered around the parking lot of the sprawling Bellis Fair Mall, telltale signs of duty-dodging Canadians who flock to the bargain-packed shopping centre.
And in a Canadian-only touch, some of those evading duty by changing into their newly bought clothes are considerate enough to neatly fold up their boxes before they head for the nearby border.
Bellingham is a small city just an hour's drive from Vancouver, excluding what can be lengthy delays to clear the border, but the shopping experience is light years distant from Canada. There are more brands, greater variety — and best of all, far lower prices for many goods.
With the rise of the Canadian dollar toward parity with the U.S. greenback for the first time in three decades, more and more Canadians are headed to Bellingham, where staff in many of the stores say half their business comes from north of the border, and other U.S. border towns. Business is booming, too, for Canadian customs officials, where lineups can grow to several hours at peak weekend times.
Al Weber, hopping across the border from Surrey, B.C., rattles off the value of the Canadian dollar — to two decimal places — as he prepares to plunge into the shopping bliss of Bellis Fair, where virtually every store is advertising deep discounts and even regularly priced items are far below the cost of comparable Canadian goods.
Two hours later, Mr. Weber re-emerges with a pair of shorts and a shirt that cost him $30, but would have set him back as much as $100 (Canadian) in Surrey, he says. But the savings won't be spent in Canada. "Now, he's taking me out for lunch," his wife, Gale Weber, said with a grin.
That one purchase sums up the challenge for Canada's retail sector: A yawning discrepancy in prices threatens to draw consumers south of the border, now that the currency gap has dramatically narrowed.
For the Canadian economy, the surge in cross-border spending is stellar news. Every dollar spent outside of Canada siphons off inflationary pressures, which have already led to rising interest rates this year. And economists say the heightened competitive threat from U.S. businesses will spur Canadian retailers to greater investments in technology and other efficiency-boosting measures.
However, what is good for the Canadian economy is not necessarily good for any one firm. "It may lead to you going out of business," said Warren Jestin, chief economist with the Bank of Nova Scotia.
For Canadian businesses, the resurgence in cross-border shopping is a return to the painful time of the early 1990s, when recession, a rising dollar and the newly introduced GST pushed Canadians into the arms of U.S. competitors. But for Canadian shoppers, the newly invigorated dollar is an opportunity to rediscover the bustle of U.S. retail.
"We figured we'd come down and check out our buying power," said Roland Beaulieu, who, with his partner, Gloria Denis, was part of a steady stream of Canadians making their way into Bellis Fair.
The story is the same across the northern United States, including New York, where the parking lot of Buffalo's Walden Galleria is awash in Ontario licence plates, even on a weekday.
The two-level Walden Galleria is a typical big American mall, flanked by department stores, including Macy's, Sears and Best Buy. Nearby, there's a Borders bookstore and a Target. The mall is directly off the New York interstate highway, about a two-hour drive from Toronto.
Buoyed by the strong Canadian dollar, Debbie Gresko and her teenaged daughter, Brooke, made the trek to Buffalo this week to do some shopping. And shop they did: two pairs of jeans for $22 (U.S.); five T-shirts for $5.99 each; a picture frame for $12.99; a pair of shoes for $40; a shirt at Hollister for $40; and $155 worth of merchandise at Target.
