Downtown Grocery Store List (current + proposed)

[Northern Light]

https://torontolife.com/city/mamdani-style-public-grocery-stores-are-coming-to-toronto-eventually/

The City of Toronto wants to get into the grocery business, council decided today.

Taking a page from New York City Mayor Zohran Mamdani, Toronto will look into opening four non-profit, city-run grocery stores, which would sell staple goods at prices lower than those of grocery giants like Loblaws and Sobeys.

According to the motion put forward by Councillor Anthony Perruzza, the city would open four grocery stores, one for each of Etobicoke, North York, downtown and Scarborough, and in low-income areas where fresh groceries are hard to come by.

Despite what some may think, margins in grocery are not typically high.

Its a business built on volume.

It also relies on low paid staff.

If you could replicate the buying power of a Loblaws, but removed all margin, if you didn't improve pay, you might be able to pass on a savings of ~5% on average.

IF you paid staff properly, there would likely be no savings at all.

Four stores will never duplicate the scale of a Loblaws or Empire.

I'm not really sure what the point is here.

IF you throw in every tax exemption, build on public land etc etc.

Maybe you can drive prices down 10%; if you target the cuts to 'essentials' (100 skus max), you might get that to 15-20% on those items; though, you'd likely be selling below cost with the intent to recover that from profitable items.

The net margin in big grocery is only ~3-4%.

Gross margin (the mark up on the cost of your can of beans is typically in 25-35% range) but that is required to cover rent, insurance, staffing, electricity etc.

Ah well. We'll see how well this works, or doesn't

 

[longfortheoldview]

Ironically, that looks like a lot of Frills.

 

[torontowest91]

or it becomes the Costco model - hardly any markup on items - but then you buy a membership... lol

 

[afransen]

Despite what some may think, margins in grocery are not typically high.

Its a business built on volume.

It also relies on low paid staff.

If you could replicate the buying power of a Loblaws, but removed all margin, if you didn't improve pay, you might be able to pass on a savings of ~5% on average.

IF you paid staff properly, there would likely be no savings at all.

Four stores will never duplicate the scale of a Loblaws or Empire.

I'm not really sure what the point is here.

IF you throw in every tax exemption, build on public land etc etc.

Maybe you can drive prices down 10%; if you target the cuts to 'essentials' (100 skus max), you might get that to 15-20% on those items; though, you'd likely be selling below cost with the intent to recover that from profitable items.

The net margin in big grocery is only ~3-4%.

Gross margin (the mark up on the cost of your can of beans is typically in 25-35% range) but that is required to cover rent, insurance, staffing, electricity etc.

Ah well. We'll see how well this works, or doesn't

I think we know how this will work. Loss-making enterprise subsidized through taxation on productive activity. And with the level of customer service one might expect from government.

 

[evandyk]

I prefer the Dundas store - it's clean and modern. The Bloor location is shabby.

The Dundas one is definitely shinier, but the quality of the meat at Bloor is the same level.