Montreal aims to curb distribution of printed flyers

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Time is running out for the home-delivered paper flyer.

New rules come into effect in Montreal next month that prohibit the delivery of marketing circulars to homes unless the resident expressly asks to receive them, overturning a system in place for decades. The move follows a similar ban already in effect north of Montreal in Mirabel. And it looks set to spread.

Political leaders and activists are hailing the changes as a long-overdue check against unsolicited paper advertising and a triumph of climate consciousness. Some small-business owners and coupon clippers say it’s clumsy policy that will hurt the most vulnerable at a time they can least afford it.

The company with most at stake is Transcontinental Inc., Canada’s biggest printer. It has opposed the idea of restricting flyer distribution for years and appears determined to do whatever it can to try to save a lucrative income stream under threat.

After launching a legal challenge in Mirabel that’s now under appeal, Montreal-based Transcontinental struck agreements with Canada Post to deliver the flyers in certain areas, the Crown corporation not being subject to municipal regulation. It’s also trying to reinvent the advertising product itself in a way it says will largely solve the waste-management problem.

For the better part of 40 years, Transcontinental has dispatched waves of carriers, often new immigrants and students working their first jobs, to deliver a plastic bag, each stuffed with flyers, coupons and sometimes a free local newspaper, to some 3.3 million households in the province. Known as Publisac in French, it is literally that – an ad bag. And depending on who you talk to, it’s either an ecological nightmare or God’s gift to the thrifty and disadvantaged.

“Before, we used to go to church every Sunday. Well, now I have to receive my Publisac every Tuesday. That’s my religion,” says a woman named Chantal St-Aubin, one of hundreds of people who voiced support for the business in a document submitted by Transcontinental to Montreal’s standing committee on water, the environment, sustainable development and parks.

Montreal Mayor Valérie Plante’s administration has put the ban in place for homes unless the owners or tenants signal they want the flyers, which they would do with a special sticker affixed to their mailboxes or doors. The move reverses the current system, where flyers are delivered to every household except those who opt out. Advertising wrapped in plastic will also be prohibited.

City leaders say 800,000 circulars end up in municipal recycling centres each week, a sum that puts significant pressure on its already-strained sorting centres. They say it no longer makes sense to recycle flyers that many people never even glance at. The situation is made more problematic by the fact that the paper is often never separated from the plastic when people discard them, making the package almost impossible to recycle.

“We’re on the right side of history” with these regulations, said Marie-Andrée Mauger, the point person on environmental issues for Montreal’s executive committee. She said the city is aware its actions will shake up established habits and business models but that municipal leaders have to act boldly to help minimize garbage and reduce the ecological footprint of stakeholders on its territory.

Governments the world over are struggling with waste management and pressure is growing on corporations to take more responsibility to reduce packaging at source. But that dynamic, at least in Quebec’s experience with Publisac, is butting against other things, such as entrenched consumption habits and the lack of internet literacy. All of which means the paper flyer is on the decline in the digital world. But it’s not done yet.

Like many other companies, Transcontinental faces increasing environmental scrutiny. And as it shifts to make packaging a more important part of overall sales, it is trying to protect its traditional printing business while not alienating stakeholders and appearing out of touch. The company declined to make an executive available to comment for this story and did not answer e-mailed questions.

In a call with analysts last September, chief executive Peter Brues said: “We remain committed to the flyer,” adding it’s the most efficient marketing tool for retail customers. He said the company is looking at “all kinds of alternatives” for Publisac printing and distribution in light of changing municipal regulations.

Three months earlier, Mr. Brues, who became CEO in late 2021, offered a wider strategic insight into how he was thinking about the print business generally: “When I started working with the team, I really felt that we should be the last people standing from a newspaper and flyer perspective in Canada.”

The stakes for the printer are significant. Analysts at National Bank estimate Transcontinental’s flyer business Canada-wide generates in the range of $520-million of revenue, with earnings before interest, taxes, depreciation and amortization of about $110-million. Quebec makes up $100-million of that top line, with Montreal accounting for roughly a quarter of the total. For context, the company tallied revenue of about $3-billion in fiscal 2022 and operating earnings of $450-million.

“More municipalities may follow Mirabel and Montreal but the whole operation isn’t likely to be abandoned in short order and not without efforts to continue printing the flyer and exploring alternative distribution strategies,” National Bank analyst Adam Shine said in a research note.

That’s exactly what’s playing out now. Transcontinental is trying to re-engineer the circular itself, saying this week it would roll out a new paper leaflet folded in four that combines flyers from various retailers into a single product with no bag. In sum: A much lighter Publisac, without the sac. The result will cut down paper volumes by nearly 60 per cent, the company said.

Ms. Mauger said in an interview that talks are under way between city representatives and federal officials on getting Canada Post to adhere to Montreal regulations. But this is an issue that stretches beyond the city’s boundaries. Other municipalities have expressed support for the city’s move and are working on their own regulations, including the 82 municipalities that make up the wider Communauté métropolitaine de Montréal.

Beyond Quebec, an effort is also afoot by a coalition of environmental groups led by Friends of the Earth that are pushing for new federal rules on single-use plastics to include those used in advertising distribution across Canada. The approach will be to take the Quebec experience and use it to leverage a federal ban, Friends chief executive Beatrice Olivastri explained.

She said that won’t include pushing for restrictions on the paper part of the advertising, for which “the writing’s on the wall” in any case with greater online adoption.

“There is a certain inevitability to all of this,” said Charles Montpetit, a retired writer in Montreal who is widely credited with spearheading what’s become a multiyear push for restrictions on Publisac in his hometown.

Mr. Montpetit began his campaign in 2017 when he asked Transcontinental to stop delivering the ad bag to his home. He says his requests were repeatedly ignored despite city regulations stating that residents have a right to opt out with a sticker on their doors. He then walked around his neighbourhood taking photos showing other instances where the flyers were delivered despite the sticker, and says he subsequently documented 30,000 such instances in all.

“As other cities follow in Montreal’s footsteps, more and more people will become aware of the need to regulate unnecessary waste,” Mr. Montpetit said.

Not everyone considers it waste. Week in and week out, seniors and other deal-seekers in the province count on Publisac for guidance on the latest specials and promotions at their nearby retailers. Hundreds of thousands of people use it as a paper blueprint to plot their weekly purchases.

“I love my flyers. I don’t go a day without looking at the specials,” says Annette Couto, a single mother with two jobs who lives in Montreal’s West Island area and uses both the paper and online version of Publisac. Just this week, she says she saved significant money on butter and flour to bake Portuguese sweet bread.

“If you’re filthy rich, you don’t care,” Ms. Couto said. “But it gives me satisfaction to know that I’m getting more, I’m maximizing all my savings by doing this.”

Manon Hénault has glimpsed into a future without Publisac as she knows it. And she doesn’t like what she sees. The owner of a small takeout food business in Mirabel, Que., Ms. Hénault used to advertise her home-cooked tartes au sucre, pea soup and other specials every two weeks in the flyer bags before the city’s new edict came into force more than a year ago. Now, because she does not want to pay more for the Canada Post Publisac delivery, she’s stopped using it, and the only advertising she does is online. She says business has dropped off.

“I’m seeing fewer of my former regular customers these days,” particularly older people, Ms. Hénault said. “We’re paying the price” for the city’s decisions.

Christian Desîlets, a professor of social advertising at Laval University in Quebec City, says advertising flyers in general are disappearing slowly, which is not necessarily a good thing. In places like Quebec, which has weak literacy rates, flyers have become the adopted shopping tool for many people because they feature simple text and numbers, often with photos, he says.

“I find it audacious to pull away this extremely important shopping planning tool, especially for more disadvantaged people, while supposing, without any solid evidence backed by proof, that the changeover from paper to internet will happen automatically, naturally, and without pain,” Mr. Desîlets said.

For Mr. Montpetit, however, the issue is as much about unwanted advertising as it is about any debate over the value of the product. Canada has anti-spam laws that outlaw online marketing without the receiver’s authorization. He says Publisac is the same thing, only worse because it is a physical product generating real-world waste. That shouldn’t be up to citizens or their governments to deal with, especially if they didn’t want it in the first place.

“It’s absurd to say that the solution here is that the entire population needs to solve a problem that one company could resolve at source,” Mr. Montpetit said. “We’re just asking that it be delivered only to people who want it.”