Grocery store giant Loblaw Companies Ltd. says its making efforts to lower prices and increase point offers as Canadians struggle with cost-of-living challenges.
The promise comes 40 days before a planned nationwide boycott by thousands of customers who say the grocer’s prices are “out of control.” It also comes two months after Loblaw reversed an earlier decision to end its 50 percent discount on food products nearing their best-before dates.
Loblaw chief financial officer Richard Dufresne said the company’s internal inflation rate in February was materially lower than food inflation as measured by the Consumer Price Index.
“An interesting example is margarine, where prices were lower last month than in January. In this example, vegetable oil prices have retreated from their peak and we’ve seen favourable harvest conditions for soybeans in South America,” Mr. Dufresne said in a press release.
“Through our private label brands, we have passed down these savings to customers.”
Loblaw will also pass on savings by providing “deeper discounts” on 35 commonly-used items at an average of approximately 30 percent off regular prices, Mr. Dufresne said.
The company plans to optimize its store network to include more discount locations by opening at least 40 more Maxi and No Frills stores in 2024, Mr. Dufresne said.
“These stores save customers approximately 15 percent compared to conventional grocery stores, and will reach 1.8 million more Canadians,” he said, adding that the company will also introduce new promotions. These include a ‘Hit of the Month’ campaign to bring “aggressive prices on key products” across the company’s network of stores.
“As a company, our purpose is to help Canadians live life well, and making good food more affordable and accessible is one of the most important ways we can do that,” Mr. Dufresne said.
“We’re turning over every stone in our efforts – lowering prices, increasing points offers and making meaningful changes to our business to help customers save money in our stores.”
News of Loblaw’s plan to lower prices comes as members of the Reddit community ‘Loblaws Is Out Of Control’ are organizing a boycott. The group, which has more than 36,000 members, is asking the grocery chain to reduce its prices by 15 per cent and remove member-only pricing that forces customers to sign up for a PC Optimum card to access deals and sales.
“We are boycotting Loblaw and Loblaw-owned stores for the entire month of May 2024,” a pinned post on the subreddit thread reads.
Loblaw Reverses Pricing Policy
A Loblaw decision that drew criticism from some customers has also been reversed. The company revised a discount policy made in January that saw previously-offered discounts of up to 50 percent on items like meat, fruit, and vegetables being changed to 30 percent. The backlash caused the company to reinstate its 50 percent policy within days of the announced change.“We’ve listened to the feedback from our customers and colleagues and are reverting [where it existed before] to the 50 percent off discounts,” said the company. “In the Atlantic, we had not implemented the change and will not. In the rest of the country, customers can expect to see 50 percent stickers returning in the next few weeks.”
Loblaw owns a number of large grocery chains including Loblaws, No Frills, Valu-Mart, Your Independent Grocer, and Zehrs.
The cost of groceries has had a big impact on Canadians’ wallets over the past two years, thanks to food inflation. While prices are not expected to rise as much this year, they are expected to increase.
Canada’s 2024 Food Price Report, released in December by the Agri-Food Analytics Lab at Dalhousie University, predicted the price of groceries would increase by an average of $701.79 per family of four this year.
An end-of-year report by the lab found that most families plan to cut back on food spending this year. One of the chief ways they will do that is by changing their food shopping habits.
A total of 43.3 percent of those polled say they will actively look for promotions in the new year to cope with higher food prices, while 34.6 percent will use more coupons and 33.6 percent will use loyalty programs more often. A total of 30.6 percent say they will shop at different stores to get better deals.
