Navigating political shifts in North America: Trudeau’s resignation, tariffs, and the impact on Canadian franchising

In 2025, North America’s political landscape is experiencing profound changes that are reshaping the economic and business environment.

Navigating political shifts in North America: Trudeau’s resignation, tariffs, and the impact on Canadian franchising

With Justin Trudeau stepping down as Canada’s Prime Minister and recent tariff announcements impacting trade, Canadian franchising is entering a new era of challenges and opportunities. These shifts are influencing the dynamics of commodities, supply chains, and business operations, requiring franchisors to adapt to an evolving marketplace. It is also impacting the decisions of Franchise buyers and businesses who were considering a franchise model.

Economic policies, tariffs, and taxation

The imposition of new tariffs is creating significant ripple effects across industries in Canada, particularly for franchises reliant on imported goods and commodities. With tariffs driving up costs for materials and products, Canadian franchise owners face increased operational expenses and the challenge of maintaining competitive pricing if their supply chain is reliant on goods produced outside of Canada. Franchises in sectors like food service, retail, and manufacturing are especially vulnerable, as those who rely on cross-border supply chains are directly impacted by trade restrictions.

Trudeau’s resignation adds another layer of uncertainty. As Canada is in transition to new leadership, economic policies remain in flux. While interim measures aim to stabilize the economy, questions linger regarding long-term strategies for addressing tariffs and fostering growth. 

Meanwhile, the United States under President Trump’s renewed administration is adopting a protectionist stance, emphasizing domestic production and introducing trade barriers. Canadian franchises operating across the border or sourcing U.S. goods must navigate these changes carefully, balancing cost management with maintaining supply chain reliability. Franchisors with strong domestic sourcing strategies may find themselves better positioned to weather the impact of these tariffs.

Tariffs are significantly affecting commodity prices, with staples like agricultural products, energy, and raw materials seeing increased costs. Canadian franchises dependent on these commodities face the dual challenge of managing rising expenses while maintaining affordability for consumers. Restaurants, for example, may need to reconsider menu pricing and sourcing strategies to account for higher food costs.

Consumer expectations are also evolving in response to political and economic shifts. Canadian customers are increasingly prioritizing locally sourced products and sustainable practices, creating opportunities for franchises that align with these values. Franchisors who emphasize “Made in Canada” initiatives or highlight environmentally friendly practices can strengthen their appeal to socially conscious consumers while mitigating the risks associated with tariff-impacted imports.

Adapting to political and economic shifts

To thrive amid these changes, Canadian franchisors and franchisees must adopt proactive strategies. Key steps include:

  • Diversifying supply chains: Reducing reliance on imports by sourcing materials and products locally can help franchises mitigate the impact of tariffs and strengthen their resilience.
  • Monitoring policy developments: Staying informed about government decisions on trade, taxation, and labor laws will enable franchises to anticipate changes and adjust operations accordingly.
  • Investing in workforce stability: Prioritizing employee satisfaction through competitive wages and benefits can help franchises build strong teams and maintain operational continuity during uncertain times.
  • Embracing sustainability: Aligning with consumer preferences for eco-friendly and locally sourced goods can enhance brand reputation and customer loyalty.

Looking ahead

The resignation of Justin Trudeau and the introduction of new tariffs mark a pivotal moment for Canadian franchising. While these changes present challenges, they also offer opportunities for franchises to innovate and adapt. By remaining agile and responsive to political and economic shifts, franchisors and franchisees can position themselves for success in a rapidly changing market.

ABOUT THE AUTHOR
Angelee Brown
Angelee Brown
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