Calgary Co-op Marks 65 Years: CEO Interview

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The first Calgary Co-op grocery store opened in downtown Calgary in 1956 and 65 years later the chain has more than 440,000 members and numerous supermarkets and speciality stores in the local region.

Ken Keelor

Company CEO Ken Keelor said Calgary Co-op has seen many changes over the decades, but its values and community-minded approach remains the same.

So how does a grocery store remain in business for 65 years especially in such a competitive environment?

“It is very, very important to focus on financial sustainability. You can have all the heart and wonderful culture and all of that stuff, but if you are not financially sustainable you’re done. You can’t serve your community. You can’t serve anyone. I think where a lot of companies, especially those that are sort of much more socially focused like we are, can lose their focus is where the management team, leadership and board, lose track of the fact that you have to be financially sustainable,” said Keelor.

Image: Calgary Co-op

“In the last seven years, we’ve had three wage increases, we’ve had property tax increases, we’ve had discount competitors come into our marketplace and open up shop, we’ve had a really tough economy with joblessness, the drop in the price of oil and jobs that were never filled again, we’ve had people leave the city.

“Calgary Co-op has put a very strong focus on I would say four elements – our sales, our profitability, our people development and our long-term plan and strategy. We built a long-term strategy for this very reason. That’s the first element and all of those pieces play into it. You’ve got to have a long-term strategy, you’ve got to be thinking financial sustainability and you’ve got to be very aware that in the environment that we’ve been in, sales are going to be hard to come by, so you’ve got to manage your costs, you’ve got to manage your margins and you’ve got to be here for the community, not just in spirit.”

Keelor said the second piece of success really is culture.

“You can’t work on strategy without working on culture, on risk and on financials. And so whenever I talk strategy I always talk about culture, financials and risks. Culture I pick out as the second factor . . . The beauty of this organization is that in its very DNA it’s service oriented and community oriented and people love to serve,” said Keelor.

Celebrating 65 years with the grandson of member number 1. He uses his grandmother’s number every time he shops at Calgary Co-op.

“It’s a culture that preserves the heart of what makes team members want to work here and want to serve.”

Today, Calgary Co-op employs about 3,850 people with 24 food stores, 30 Wine, Spirit and Beer stores, 10 cannabis stores, 39 gas bars, three Home Health Care locations and three Community Natural Foods stores.

The company’s presence is beyond Calgary in communities such as Cochrane, Airdrie, Strathmore, Okotoks, and High River.

Keelor became CEO in 2014.

Calgary Co-op, one of North America’s largest co-operatives, was established by Calgary and area farmers and ranchers who wanted to serve Calgarians with fresh, local food.

Image: Calgary Co-op
Image: Calgary Co-op

Today it also has three private brands: Cal & Gary’s, Founders & Farmers, and Only Alberta Meat.

It has assets of $627 million and annual sales of $1.2 billion.

“We need to innovate but it needs to be commercial innovation that drives the business of the company,” said Keelor.

In the past year, the company has renovated its stores in the Dalhousie and Brentwood neighbourhoods. It has also completely renovated the downtown Community Natural Foods location.

It has also significantly advanced its construction and redevelopment of the Oakridge Co-op location which will include a residential component. The plan for the redevelopment of the North Hill location, with residential as well, is coming along.

The grocery chain is planning to open a new location in the Marda Loop neighbourhood in 18 to 24 months.

Image: Calgary Co-op

“We are also potentially looking at one more site in that Springbank Hill area,” he said. “We haven’t inked an arrangement yet but certainly we have interest in going into that area,” said Keelor. “We might look to areas like Cochrane in the future to areas like Skyview which is way northeast (in Calgary). Skyview is a developing community that’s growing really fast. Cochrane has grown really fast already. We believe those two areas would fit the bill quite well for Calgary Co-op.

“The small footprint that we put in Sage Hill that we’ll even skinny down more in Marda Loop we’re very interested in seeing how these perform because there may be potential for smaller footprint stores in the future for Calgary Co-op.”

Keelor said health and wellness is an area of focus for the company moving forward. It will be growing its pharmacy business, its home health care business, its Community Natural Foods division, and its natural foods business within its stores.

“The whole area of health and wellness is going to be something that we’re going to lean on for growth for the company for long-term sustainability and long-term strategy and financial sustainability are all founded on one thing – being uniquely different to the marketplace,” he said. “If you don’t have differentiation, you will not have long-term financial sustainability.

Image: Calgary Co-op

“You might sustain a couple of years but if people don’t see you as different, your competitors can copy you and you’re done. So health and wealth and wellness will be one strong area of focus. The other area of focus will definitely be leveraging our real estate to grow. When you look at our real estate, we have over $400 million in real estate and we have got to look at how we can use that to grow be that expanding our stable of tenants that we have on the properties, be that building more or new lines of business on those properties, or be that even monetization of those pieces of land that a lot of Calgary Co-op’s money is invested in. Those revenues can drive our growth.

“We can only kind of grow by using our operating earnings or cash from the business by leveraging the properties that we have or by taking a loan. And we plan to do all three of those things.”

Article Author

Mario Toneguzzi
Mario Toneguzzi
Mario Toneguzzi, based in Calgary, has more than 40 years experience as a daily newspaper writer, columnist, and editor. He worked for 35 years at the Calgary Herald covering sports, crime, politics, health, faith, city and breaking news, and business. He is the Senior News Editor with Retail Insider in addition to working as a freelance writer and consultant in communications and media relations/training.

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