Winnipeg businesses furious over $500K grant given to online delivery service at height of pandemic lockdown

Some Winnipeg small businesses say they are outraged that online delivery service Good Local received $500,000 in provincial funding at a time in the pandemic when they were struggling the most, and are questioning whether the money could have done more good if it was distributed more equally. 

But the head of the Manitoba Chambers of Commerce is defending the decision to give Good Local a grant to support shop-local efforts at the end of 2020, saying they had to act quickly to help keep businesses afloat. 

The funding was part of $1.5 million that came from the provincial government, which tasked Manitoba Chambers of Commerce with doling it out to help support and protect local businesses impacted by COVID-19 public health orders. 

When the funding was announced, the province said the funds would be used to help Good Local support more vendors, makers and farmers while improving their customer interface to increase sales. 

The online delivery service was co-founded by Obby Khan, who is now running for office for the Progressive Conservatives — the same government that provided him the cash through a chamber of commerce.

Good Local's share of the grant money was brought to light last week through a freedom-of-information request by the Manitoba Liberals. 

The circumstances don't sit well with Sherry Sobey, who recently closed her Exchange District store Generation Green after being in business for several years. 

She said she had been selling locally made products at her business for years, as have other shops in the city. 

"I'm not about competition here. The more places that are selling local business owners' products, the better. That's not the issue. It is just more the fairness of it all."

She penned a letter to the Manitoba Chambers of Commerce asking for answers, and is urging other small business owners to do the same. 

Sobey says she thinks it would have been more beneficial to give the funding directly to multiple store owners, rather than supporting an online platform that sells products from several vendors.

That was the same concern for Tara Davis, who owns Tara Davis Studio Boutique on McDermot Avenue, which sells goods from several Manitoba vendors. 

She and other women entrepreneurs took to Instagram earlier this week to speak out. 

"There are many small businesses in Winnipeg that have been supporting local for years. Most of them have e-commerce," she said in an interview with CBC News. 

"The infrastructure was already there. So had that money been distributed more fairly, all of these businesses would be thriving and able to continue supporting local in a greater way." 

Davis, along with Kim Bialkoski of Preserve, a Winnipeg store that sells locally made goods, and Jill Zdunich, owner of Shop Take Care, took part in a news conference Thursday to voice their concerns alongside Trudy Schroeder, who is running for the NDP against Khan in the Fort Whyte byelection.

Chuck Davidson, Manitoba Chambers of Commerce president, said the organization suggested Good Local to the province as an option to help businesses get their products to customers while their storefronts were closed down. 

This was in November 2020, when virtually all businesses were forced to close due to pandemic restrictions, Davidson said. 

In an interview Thursday, Khan said Good Local submitted a proposal to the Manitoba Chambers of Commerce outlining how the money would be used before they were given the funding. 

"This was not a gift; this was not a cheque to Obby Khan," he said. 

"All I want to do and all my staff want to do is support local, and it's really unfortunate that, you know, people have taken it this negative way."

Davidson said he understands where these small businesses are coming from, but said a typical grant program could have taken months to undertake, at which point some businesses would have been defunct. 

"We thought this was a better model, to help provide it to one company that could provide that service for businesses that, you know, $1,000 is not going to make a huge difference to them in terms of getting them that online presence," he said. 

"It wasn't about helping one business, it was about trying to help as many as we could that we knew were struggling significantly." 

Davidson said he was pleased with the results of that funding, which he says helps Good Local grow from 38 vendors and producing $40,000 in sales, to a total of 388 vendors and almost $850,000 in sales over a period of about two months. 

A spokesperson for the province said the government applauds the success of Good Local and the suggestion there was anything inappropriate in how these funds were dispersed is false.