State of the big chain grocery stores

[299 bloor call control.]

It looks like Fresh & Wild is continuing its expansion, and opening a store in the Distillery District this fall.

http://www.freshandwild.ca/

 

[adma]

I noticed at the new Morningside-Kingston Food Basics today that it looks like the Food Basics logo + graphics have been "Metro-ized" a notch...

 

[ShonTron]

While my local Dominion lost the exterior signage, the Parkway Village Mall location at Ellesmere and Vic Park has yet to be touched (this is my favourite vintage grocery store in Toronto). I'm really wondering how that location will be "Metro-ized". It will continue to scream pre-Conrad Black era Dominion.

 

[MetroMan]

Wow! Welcome to Metro Toronto!

Should I sue for copyright infringement?

 

[samsonyuen]

Went to Metro today. Not bad. The store was well-stocked, lots of deals, and a wide variety of products I don't often see at other stores (lots of Quebec suppliers?).

 

[billonlogan]

I'm not a big fan of Dominion and it's Master Choice brand. Look forward to seeing the new products available at Metro. Any idea when the Dominion Store at Parkway Mall will change over?

 

[Northern Light]

Metro conversions/brands

In answer to the question about Parkway, I don't know the exact order...but all City of Toronto stores are to be converted to the Metro banner no later than December 31, 2008. (assuming they're not going to Food Basics...which 1 or 2 might)

Most stores will not be gutted, you will see subtle changes in signage, product assortment, some touch ups to displays and end caps.

Only the stores that are really needy will get gutted.

*****

In answer to the question about product variety/assortment....

Yes, most of the popular products Metro has in Quebec are being sourced to Ontario, where local laws and supplies permit.

The legal reference refers to things like game meat that is much more restricted in Ontario.

The biggest product changes will be:

a) finishing the conversion of the house brands to Irresistible and Merit Selection.

b) adding more organic, more ethnic and more gourmet products.

Some of this has already happened quietly over the last few months; while other things are generally happening as the banner changes over.

 

[adma]

Well, Nuit Blanche introduced me to the Metro-ization of the Liberty Village Dominion...

 

[interchange42]

Me too - and exactly that location. BuildTO, Darkstar 416 and Simply Dan and I were in there and out of there very quickly though, just long enough to get something to drink, so it wasn't a case of us comparing what we remembered of Dominion and what we were now seeing. I can't have been in a Dominion more than twice in the last year though, so there isn't much chance that I would notice all that many differences too quickly.

Despite Dominion giving Air Miles (which I have collected enough of over the years from other places so that I haven't paid for a flight to Chicago or New York in ages), the store has just not been interesting to me. Their Equality house brand was probably the blandest of all the house offerings out there, and their prices were always higher than Sobeys or Loblaws as best as I could tell. Does anyone know something I was missing? Unless a Dominion was the most convenient supermarket for you, did any of you ever go out of your way to shop at one? What was the reason to patronize them?

42

 

[Urban Shocker]

Other than the free entertainment - watching customers cower in fear of Ilsa, She-Wolf of the Checkout at the Market Square Dominion - none that I can think of.

 

[Jonny5]

I saw this in The Post today.

Grocers go urban
Grocery chains are downsizing suburban stores to create 'baby big-boxes' for downtown

Kathryn Blaze Carlson, National Post


Major grocers are stepping out of suburbia and into Toronto's downtown core, tweaking their big-box concepts to fit a high-density area born from the recent boom in condominium development.

In the past three weeks alone, Sobeys and Longo's have opened "baby-box stores," quenching a market once thirsty for convenient options aside from the ubiquitous Rabba and Kitchen Table.

Sobeys' new Spadina Avenue and Bremner Street location -- a 20,000-square-foot outlet under the brand Urban Fresh -- is the fourth downtown store the retailer has opened in the past 18 months, affirming that downtown Toronto is the new hot spot in grocery retailing.

In a true departure from the suburban model, the recently opened Sobeys boasts dim lighting and glossy black floors, making the store feel as much like a restaurant as a grocery.

Couples snack at tables along floor-to-ceiling windows, eating meals created by white-jacketed chefs who toss stir fry, bake pizzas and press paninis. Chicken with brie and green apple is among the favourites.

Some use the cafe's wireless Internet and others nibble as they shop, testing sushi taste offerings. Around the corner is a display of prepared foods piled high in white bowls and priced by weight, ranging from 80¢ to $3 per 100 grams.

Over at the base of a new condominium building behind City Hall, Longo's recently opened a boutique-sized store, building on a "Market" concept begun three years ago with a location at BCE place.

The 7,000-square-foot store has an extensive deli, fresh fish and produce hand-picked each morning from the Ontario Food Terminal. The kitchen is clad in stainless-steel appliances and offers such fresh fare as fennel salad, mushroom risotto and Mediterranean salmon. Items here are a touch pricier, ranging from $1.69 to $6.49 per 100 grams.

"The 'Market by Longo's' brand is for people who are food-involved, lead busy lifestyles, want healthy choices, and shop a few times a week," said Anthony Longo, president and chief executive of the Mississauga retailer, adding that he plans a third downtown "Market" location at Yonge and Bloor streets in coming months.

The influx of grocery stores to downtown Toronto is a classic "If you build it, they will come" scenario: The city's core is one of the fastest growing neighbourhoods in greater Toronto. Its population has grown 65% in the past three decades and nearly 20% in the past five years, according to a 2007 city planning department report. Many of downtown's roughly 170,000 residents are wealthier, younger and better educated than their suburban counterparts, the report says.

"We had to think totally differently with our urban stores," said Mary Dalimonte, general manager of Sobeys Urban Fresh brand, showing off the 300 kinds of cheese at the Bremner shop. "It's about maximizing the square footage and catering to today's foodie."

Barry Lyons of Lyons Consultants said that retailers were once tentative to rejig their tried-and-true suburban model, but are becoming more brave.

"Building a downtown store just wasn't what [major retailers] did," Mr. Lyons said. "They had to break out of the mould and understand the urban shopper."

People living in the city's forest of new downtown condominium towers are less likely to have children and more likely to lead busy social lives that leave little time for food preparation.

"What's going on now is very similar to what's gone on in New York City for years, where you have people in suits carrying one grocery bag at a time and shopping every second day on their way home from work," said chef Mark McEwan, who recently opened his self-titled store in the new Shops at Don Mills.

Mr. McEwan said he plans on tapping into the downtown market in the coming months, possibly with a European-style store along the Bay-Bloor corridor.

Already enjoying success in that area are upscale grocers Whole Foods Market and Pusateri's.

"That Whole Foods had a slow start but is doing really well now," Mr. Lyons said.

Meanwhile, supermarket giant Loblaw Co. is holding off on adding to its contingent of downtown stores, which consist of a suburb-style store at Lower Jarvis Street and two No Frills and a Valu-mart, both owned by the company.

Although Loblaw bought Maple Leaf Gardens in 2004 and acquired permits to turn it into a flagship store in 2007, the company has yet to begin construction on the former arena.

Regardless of Loblaw's plans, Mr. Lyons said the influx of other major chains will pose a challenge to grocers like Rabba and Kitchen Table, which have historically enjoyed a monopoly.

Said Rabba's Front Street West manager Frank Bernardi: "This is something new. The story will soon unfold."

It's fine to have specialty stores focusing on convenience products and prepared foods, as there is a time and place for them for everyone. I find it a bit self-indulgent though, for them to be seemingly justifying an obviously high-cost expansion push to target those "who are food-involved, lead busy lifestyles, want healthy choices, and shop a few times a week". Those are pretty and cliched buzz-words that are being used as an excuse to offer less for more. Mark McEwen, talks about targeting shoppers who are part of some elite group of wealthy proto-Manhattanites. That MAY work for his Don Mills store (which, ironically, is quite Un-Manhattan), but I don't know about downtown, which the article is really talking about. I'm also quite sure many of these "busy lifestyles" involve several hours of reality TV each night.

At some point soon, the influx of these stores is either going to result in serious price competition, or a dramatic quality drop in their offerings. It's normal for groceries to be a very cutthroat reatil business.

I suspect the old chains, Kitchen Table and Rabba and maybe even some of the smaller Metro stores, with their build-out costs long paid off, may morph into somekind of "smallbox" No-Frills equivalent, focusing on more frozen and packaged prepared foods and substantially lower cost produce.

 

[buildup]

"The 'Market by Longo's' brand is for people who are food-involved, lead busy lifestyles, want healthy choices, and shop a few times a week," said Anthony Longo, president and chief executive of the Mississauga retailer, adding that he plans a third downtown "Market" location at Yonge and Bloor streets in coming months."

There's defintely room for another big grocer in the area unless that grocer in the basement of the Manulife expands quickly. With Uptown, Crystal Blue, and those 2 big towers on Charles just west of Yonge coming on stream things will get more conjested.

 

[ShonTron]

I've been noticing a lot of Price Chopper stores in the suburbs have been rebranding as "Freshco" stores. Anyone else noticing this?

Price Chopper was the worst of the Basic Frills Price tier of discount grocery stores. Is Sobey's actually trying to make an effort in this category?

 

[Northern Light]

In answer to ShonTron........yes...............

Article link here:

http://www.theglobeandmail.com/repo...n-the-low-frills-grocery-game/article1565508/

They are basically going for similar to what they have, but better selection, more fresh stuff, more organics.....but still 'discount'ish'

Article below:

The battle over okra and karela is just heating up.

Sobeys Inc., angling for a bigger share of the discount grocery market, is taking aim at Loblaw Cos. Ltd. with a store format called FreshCo, which will focus on fresh foods, while catering to budget-conscious multicultural customers.

Sobeys is launching the new concept in eight of its former Price Chopper stores starting Wednesday. The country’s second largest supermarket chain plans to rapidly expand FreshCo, converting more of its 87 Price Choppers to the new format and adding new outlets.

If successful, FreshCo will give Sobeys an important weapon in the increasingly crowded battle for the culturally diverse grocery shopper. That segment is being hotly contested as retailers attempt to take advantage of a massive change in Canadian demographics. By 2031, one in three Canadians will belong to a visible minority – and one in four will be foreign-born, according to Statistics Canada.

Already, a growing number of bargain-hunting customers are new Canadians who look for dried shrimps or kecap manis along with their paper towels. In the fight for those customers, Sobeys is taking on Loblaw, the market leader, which last year acquired T&T Supermarket Inc., a specialist in Asian foods, and continues to beef up its No Frills chain.

Metro Inc.’s Food Basics discount chain is also broadening its low-frills offerings, while discount giant Wal-Mart Canada Corp. is adding new “super centres†with full grocery sections that attempt to lure local ethnic shoppers.

For its part, FreshCo aims to combine discount prices and ethnic appeal with a focus on freshness.

“It’s not just about low price in a cheap environment,†Sobeys chief executive officer Bill McEwan said in an interview. “It’s about low prices with less compromise … And importantly it’s about tailored product assortments by store.â€

Customers inside T&T supermarket on Cherry St., Toronto

Especially important is catering to the needs of the fast-growing South Asian and Chinese Canadian communities. Both tend to shop at discount supermarkets such as No Frills or T&T, according to a 2008 study by Solutions Research Group. “It’s essential that their grocery dollar go as far as possible,†said Kaan Yigit, president of the market researcher. “You’re dealing with a population that is generally new to Canada, and larger families with two or three kids in the home.â€

Sobeys’ Price Chopper has lagged its main competitors in Ontario, the country’s largest discount market, Perry Caicco, retail analyst at CIBC World Markets, said in a recent report. A much-needed makeover of Price Chopper could raise the profit of Sobeys’ parent Empire Co. Ltd. by between about 8 and 16 per cent in Ontario over the next three to five years, Mr. Caicco predicted.

At FreshCo, shoppers enter a “fresh hall†that devotes as much as one-third more space than other discounters to fresh products, Mr. McEwan said. From fruits and vegetables to meat and seafood, fresh items can generate up to twice the margins as packaged goods.

“Shoppers have consistently told us that they are tired of having to make the compromises associated with shopping at ordinary discount stores,†said Rob Adams, FreshCo’s general manager and a former No Frills executive.

The stores have a multicultural section close to the entrance that carry products such as Kohinoor basmati rice and Bikano fried potato chips. Other features: gluten-free, diabetics-friendly and organic products.

The first stores are in Brampton and Mississauga, which have a high proportion of new Canadians. In Brampton, for example, the South Asian community has grown 245 per cent over the last 12 years and makes up about one-third of the population, Mr. McEwan said.

“It’s a bold move,†said Alan Middleton, assistant professor of marketing at York University’s Schulich School of Business. “Now they have got to deliver on being lower cost.â€

That requires a relentless war on overhead. FreshCo significantly scales back labour costs by offering self-serve meat, seafood, deli and bakery sections, and bag-your-own-groceries at the checkout, Mr. McEwan said.

The chain also trims costs by placing products on the shelf in open boxes. That reduces restocking time to just three minutes per box rather than the 35 minutes that would be required to hand-stock individual items. Dairy coolers are replenished from a back door, eliminating the need for employees to lug merchandise into the store to stock shelves.

Sobeys’ investment in more efficient inventory management allows it to reduce the size of its storage rooms by up to 10 per cent as products move more quickly to the shelves, he said, and its advanced systems help it better track local shopping preferences.

“Clearly we’re expecting improved sales productivity ad increased profitability or we wouldn’t be making this substantial capital investment,†Mr. McEwan said.

 

[MindMe]

I've been noticing a lot of Price Chopper stores in the suburbs have been rebranding as "Freshco" stores. Anyone else noticing this?

Price Chopper was the worst of the Basic Frills Price tier of discount grocery stores. Is Sobey's actually trying to make an effort in this category?

I used to like Price Chopper but the ones I've gone to have stopped selling a few products I like (for example rubicon tetrapacks of mango/guava juice).