Trump’s Trade War Could Make My Company Stronger

I started Aliya’s Foods in 1999 with my wife, Anis. We make ready-to-eat Indian meals under a brand called Chef Bombay, which we started selling in the U.S. in the early 2000s. We saw a gap at the time in the American market; Indian options were limited and just didn’t taste authentic. But we knew we had a great product, and this was also just around the time that interest in global flavours and healthy convenience foods was really taking off. The U.S. soon became our main market, and we started selling in big supermarket chain stores like Kroger and H-E-B down there, though we’ve never left our home in Edmonton. In 2021 we moved from a 42,000 square-foot facility to a 100,000 square-foot one, where we now produce around 80,000 meals per day. About 85 per cent of all our products go to the U.S.

When Trump first announced tariffs, I thought, You must be kidding. It wasn’t just that the U.S. was our main market; we also sourced a ton of ingredients from the U.S.: chicken, peas, carrots, potatoes, onions and more. Everything we make was vulnerable. We did some scenario planning and figured out that the tariffs could end up costing us up to $75,000 each month. Our management team—me, Anis, my daughter Khadija and my nephew Hafiz—quickly made two key decisions. First, we weren’t going to pass any price increases to our customers. And second, we weren’t going to lay off any of our 325 employees. Our staff helped us build this business, and we’re not going to give up on our people. Some of them have been with us since we started. 

So that meant we had to cut costs dramatically. Our purchasing team, led by Anis, immediately began hunting for non-U.S. raw ingredients to meet our specifications without compromising quality. We already knew from experience, however, that switching suppliers would be hard, especially on short notice. There was a global tomato shortage last year, which forced us to find new suppliers for those—but tomatoes vary enormously in moisture, flavour and sugar content depending on where they’re grown. We spent more than 100 hours evaluating different possibilities before making a decision, and that was for just one ingredient. Doing it for everything in our supply chain, and urgently, was daunting.

We reached out to every contact we had, just about overnight, to find Canadian or international suppliers who could match our quality and specifications. We received three to four samples of each item from different locations, and our R&D team began adjusting recipes to account for the variations in the ingredients, to ensure a consistent product. 

As of now we’ve already made some switches, like for chicken, which is our biggest input cost. Most of it used to come from the U.S., but now we’ve got three suppliers in Canada—which altogether cost us a little bit more than we used to pay. 

Some things have been harder to replace, and they really show how entangled the Canadian and American supply chains are. For example, Canada grows lots of potatoes, but it’s hard to find a supplier that processes them to our specifications, in terms of how the skin and eyes are removed, and how they’re diced and blanched. So, we’re still getting them from the U.S., for now. The lidding film on our trays is another tricky one to replace. We need ours to be both oven- and microwave-safe, but the supplier we found in Canada only makes microwaveable film. They’re starting R&D on oven-safe and microwaveable film, so hopefully we can switch soon. 

Our CFO has crunched the numbers, and we’ve found a way to balance our books for the next year, to make sure we’re ready for what comes next. We only paid tariffs on a couple of trucks’ worth of products before Trump paused tariffs in March, and we’re still in the six-month relief period the Canadian government has granted for goods imported for food packaging. But we’re not sure what will happen next. I’m hoping we’ll find even more savings as we establish better relationships with our new suppliers, and as we put in bigger orders. The weaker Canadian dollar, while unfortunate, is also benefitting us, since most of our sales are in the U.S. 

We’ve definitely been feeling a lot of anxiety throughout the tariff situation; lots of long meetings and sleepless nights. We haven’t been sure what’s going to happen next, and what could change, so all we can do is concentrate on being prepared for anything. If things get worse, we feel confident that at least we’ve done everything we can to diversify our supply chain, to shield us from future tariffs or trade-war escalation. 

Overall, I do think we’re pretty well-positioned. Now that we’re using more Canadian suppliers, we’re paying lower delivery costs and reducing our environmental footprint. This has also been an opportunity for my daughter and nephew, our business’s next generation, to flex their leadership skills. They come up with solutions and then we sit down and talk about what they’ve come up with. There’s a real sense that we’ve been through plenty before, and we’ll figure this out too.