TORONTO — Is it or isn’t it made in Canada?
Concerns over that weighty question have dogged parka maker Moose Knuckles in 2016, particularly after Canada’s Competition Bureau took action earlier this year against what it considered to be deceptive marketing practices by the outerwear company.
Now the brash brand has reached a deal with the bureau, agreeing to make it clear on its advertising and labeling that certain parkas it manufactures are made with Canadian and imported components.
“We make products around the world but this particular issue impacted the core of our line. That’s more than 50 percent of the total product we sell so this was a pretty major assault,” said Noah Stern, owner and chief executive officer of Moose Knuckles International.
Yet Stern ultimately called this “a good news story” for the Montreal-based company,” saying, “We are being even more transparent than ever.”
“When you start a product line in Canada it’s a good idea to go to the bureau and get their advice, which is what we did in 2011,” said Stern, adding that the company made three more visits to the watchdog organization over the following five years.
But in 2015 the bureau began to ask questions concerning the promotion of the company’s goods as Canadian-made.
“The key issue related to the bureau’s investigation was the labeling of certain parkas as ‘Made in Canada,’” said Josephine Palumbo, the deputy commissioner of Competition, Deceptive Marketing Practices Directorate.
As a result, in April the bureau filed an application with the Competition Tribunal alleging that Moose Knuckles’ “Made in Canada” parkas priced from $600 to above $1,000 were mostly made in Vietnam and elsewhere in Asia.
The bureau also expressed concerns that only finishing touches like zippers, snaps and trim were done in the company’s Winnipeg-based factories.
The bureau even sought a $4 million penalty and “restitution for consumers” who are willing to pay a premium for “Made in Canada” products.
Yet from Stern’s perspective Moose Knuckles did nothing wrong.
“In Canada there are guidelines the bureau would like people to follow but they are not law,” said Stern. “When all these questions first arose the bureau really had limited information in their hands and proceeded on that. But once we showed them the high level of our sewers’ skills and the manufacturing that was taking place year-round in Canada because of the product we make, we reached a settlement.”
Under this new agreement, which will secure the continued employment of hundreds of Canadians, Moose Knuckles must convey the make-up of its parkas to consumers.
“We had the phrase ‘Made in Canada from imported textiles’ on our content labels. But that qualifier wasn’t listed on our hand tags or web site. We will be clarifying this point as we move forward,” said Stern.
Moose Knuckles will also add an internal compliance program in its Winnipeg-based factories to prevent any misleading advertising and labeling slips.
Finally, the company will donate 750,000 Canadian dollars, or $559,500 at current exchange, over five years to Canadian charities, such as those that provide winter coats to children in need.
“That route made far more sense to us than spending all kinds of money on lawyers and going to court,” said Stern.
Despite such controversy “business has only gone up” Stern revealed. “It’s been a difficult coat season so far, but we had a better sell-through than in 2015,” said Stern.
“Lots of new categories are on the horizon for us,” he added, sharing no further details.
But as its European expansion continues Moose Knuckles has added agents in France, the Netherlands and hired a new executive team in Italy.
The brand will launch its new Moose House in Milan in 2017. Describing it as a “home within a factory with lots of exposed brick,” Stern confirmed that the company will take possession of the building in mid-January.
Moose Knuckles will also open a new, two-story showroom in New York across from Bryant Park in January.