Loblaw said the company plans to open 80 new grocery and pharmacy stores this year, with about 50 of which will become discount grocery stores.
The company says the new location will be part of an approximately $10 billion investment over the next five years, including $2.2 billion this year.
The 2025 plan includes renovations to more than 300 grocery and pharmacy locations.
It also includes modernizing the company’s supply chain, including East Gwillimbury, the first opening of ONT. The distribution center began construction in 2022.
“From one of North America’s largest fully automated distribution centers to introducing dozens of small, hard discount stores in the communities that need it most, this investment will have a positive impact across the country,” said bank-by-bank. said the CEO of In a press release.
Robloux is at the forefront of the shift to discounted shopping over the past few years as Canadians look for ways to ease inflation and higher interest rates.
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And other major grocery stores are spending money on discount stores by opening new locations and converting several existing stores into low-cost banners.
Roblau appears to be “reading the room” with this latest announcement, retail analyst Bruce Winder said.
“It… shows where they’re heading from a business perspective,” he said.
Inflation sends groceries prices that are rising after the Covid-19 pandemic, shoppers want more sales, more frills, freshcos, food basics and more than other stores owned by major grocery stores. We have responded by selecting a discount banner.
Major grocery stores have also been scrutinized by shoppers and politicians in recent years, denies accusations of inappropriate profits from inflation.
In the 2023 fiscal year, Roblow opened 31 new discount stores through conversions or new locations, split between Frill and Quebec-based Maxi Banner, according to its annual report.
We also started testing a new store format last year. It opened a small No Frills store and launched a pilot project that includes a new banner based on the brand of that name.
In a recent revenue call, Metro and Empire executives say discount stores are still beating other banners in terms of sales growth, but the gap is beginning to narrow as inflation normalizes.
But Winder nevertheless believes that the demand for discounts has not disappeared.
“I personally think it’s a permanent change and I’ll continue to grow,” he said.
In a press release, Loblaw said that since 2020 it has spent more than $8 billion on improving and expanding its store network and modernizing its supply chain.
Canadian grocery stores are investing in their supply chains with a focus on automation, Winder said.
For example, Metro recently reached its final milestone in a seven-year supply chain project that uses automation to make operations more efficient.
Loblaw said the renovations will include adding around 100 new pharmacy clinics to shoppers’ drug mart locations. The company is expanding its network of these clinics to provide assessment and treatment of certain common diseases.
Winder said it was a timely decision amid the fight against Canada’s healthcare system.
“I think it will be welcome as the chances of a doctor-to-pharmacist move increase,” he said.
Canadian press correction: This is a revised story. Previous versions have misrepresented currency in Headline.
