Toronto -- Most retailers in Canada are ready for a phase-out of one-cent coins, a national retailing trade group said Wednesday.
The Retail Council of Canada said the majority of the country's retail businesses were prepared for the disappearance of the penny and will follow the government's proposals for determining prices.
The Canadian Mint stopped producing pennies last spring and will begin phasing them out of circulation starting on Feb. 4. At that point, retailers are encouraged to round prices up and down to the nearest five cents when exact change is not available. For example, an item that costs $1.01 or $1.02 will be rounded down to $1, while an item costing $1.06 or $1.07 will be rounded to $1.05; an item costing $1.03 to $1.04 will be rounded to $1.05, while an item costing $1.08 or $1.09 will be rounded to $1.10. Rounding will not be needed when payment is made by check or electronically.
"On Feb. 4, most of Canada's retailers will be ready at the cash register to handle the phase out of the penny," RCC president and CEO Diane Brisebois said. "While we have been supportive of this initiative all along, we are grateful that the government delayed implementing the changes until this point, as retailers have needed the extra time to prepare."
According to an RCC survey, 55% of retailers are prepared for the phase-out, while 74% of small retailers and 75% of large retailers will round manually at the cash register. At the same time, 63% of large businesses will change their point-of-sale systems, which could cost them more than $100,000.
"While smaller businesses will do the rounding manually and then determine the appropriate course of action, both in relation to cost and customer service, it is not a practical approach for retailers 0with thousands of employees," Brisebois said. "This of course represents a substantial cost for retailers to enable them to maintain standardization and meet consumers' needs and expectations."