“The Loblaw boycott might have been helpful, but it won’t be. Instead, we are merely witnessing the embarrassing attempts of a group that isn’t even trying to understand how the food industry functions and how it needs to be improved.”
For months now, we have heard rumblings of a Loblaw boycott organized by a clandestine group aiming to penalize grocers for their perceived profiteering. This alleged boycott is set to start on May 1, with participants calling for a reduction in food prices. However, it’s important to note that many food prices have already been declining for weeks, rendering the movement somewhat misguided in achieving its purported goals.
Canadians justifiably feel frustrated, unprotected, and deserve a platform to be heard. While boycotts can be effective in the food sector, successful ones are logically sound and coherent. This boycott targets Loblaw, Canada’s largest grocer, which controls less than a third of the market. Moreover, the boycott overlooks foreign competitors like Costco and Walmart, which are inexplicably exempt from the movement. The arrival of both Walmart and Costco led to the consolidated grocery industry we have today. This selective targeting undermines the boycott’s credibility.
If the goal truly is to enhance food affordability, the boycott should encompass all major box stores, not just focus on one company. Moreover, to truly address the issue at hand, the movement should support independent grocers who compete against these large players without any substantial backing. Independent grocers often promote local foods and innovate across various food categories. Despite their contributions, these smaller entities seldom receive the recognition they deserve and are prevalent in communities nationwide. Contrary to popular belief, smaller does not inherently mean more expensive, and the boycott could have highlighted the value of supporting independently owned and operated stores.
Furthermore, any Canadian who takes two minutes to read and assess the financial reports of top grocers like Loblaw, Empire/Sobeys, and Metro will quickly realize that accusations of profiteering are largely unsubstantiated. Not only have these companies seen same-store food sales growth generally below food inflation rates in recent quarters, but their gross margins also—a true indicator of profiteering—have remained stable for at least five years across all three corporations. These firms are highly diversified, earning significant revenues from cosmetics, clothing, pharmaceuticals, financial services, and real estate, benefiting from their varied market positions.
The boycott also raises concerns regarding its underlying motives. Some members of the group are targeting and threatening experts and academics who disagree with their stance, and have attacked journalists who report dissenting opinions, exhibiting almost cult-like behaviour. This aggressive and confrontational approach is uncharacteristic of Canadian social movements and suggests a politically motivated campaign rather than a genuine grassroots effort. Originally well-intentioned instigators seem to have lost control of the movement.
While Loblaw is not entirely without fault—particularly concerning its intense pressure on suppliers, which can stifle competition and reduce consumer choice—the boycott missed a crucial opportunity to educate Canadians about the real issues within the food industry and the role of major grocers like Loblaw. We need a code of conduct to establish a level playing field for all grocers and food manufacturers in Canada. Instead, it opted for sensationalism and quick publicity, a disappointing and ineffective strategy that ultimately failed to address the systemic issues it purported to confront.
How about the fact that for most people,especially those living in small towns,are on fixed income and can’t afford ultra-pricey cars with premium gas,there isn’t a choice on where they shop……?
I’m pretty sure cheap cars that run on regular can also be used for grocery shopping
Local bakeries are often within walking distance or accessible by public transit you’re just lazy and not willing to support the local economy
Thank you so much Retail Insider for offering many Canadians a different perspective – which you always do.
An excellent observation of the industry and the ineffeciency of misguided knee jerk reactions. Your most pogniaant comment is the one concerinnig Walmart and Costco.You re on point! They have had a significant negative effect on the retail food undustry. At the same time our government is travelling the world trying to entice even more international discounters to open shop in Canada. Hopefully you have a voice at the federal government level to let them know what they are bargaining for.
More competition? Look at our cell phone service, 3 companies own canada. Monopolies aren’t a good thing, not something to root for.
Just because Loblaws is canadian makes it OK for them to conduct themselves like criminals? Did you get your $25 gift card!?!
Actually you are dead wrong. You obviously can’t target all grocers as you need to get food. The reason Loblaws is being targeted is because they received $12 million handout of tax payers money when they are continually showing billion dollar profits. When CEO’s and the fat corporate execs start taking pay cuts and showing they care about the people and communities then we will give them respect. No one should be earning 7 figure salaries and then getting 7 figure bonuses on top of that while millions of Canadians are struggling to live.
Thank you. Obviously the article is written from a biased perspective with the underlying tone that implies Canadians are unintelligent. It is ridiculous to imply we can target all grocers involved ( at the same time) as we still need food. Unfortunately we all do not live in cities/towns with small markets/grocers.
I am happy to hear Canadians are pushing back. I hope this momentum grows.
I think this article deeply misinterprets this boycott. Boycotting Loblaws is not only (perhaps not even primarily) about grocery price gouging (which was, don’t get me wrong, a cold-hearted abuse of the pandemic as an excuse for exponential personal profits at the cost of ethics). No, boycotting Loblaws is about the unchecked and growing monopoly of an oligarch family that — rather than pay a fair share of taxes — actually gets government kickbacks! Loblaws is essentially a partisan entity, operating against the better interest of Canadians and against democracy.
Loblaws is far more than groceries. Boycotting Loblaws means saying no to shenanigans with patients’ pharmaceutical prescriptions (check the news this past year for pharmacists at Shoppers Drug Mart being asked to call patients and recommend additional drugs – essentially “sales calls” masquerading as healthcare). Boycotting Loblaws means standing up to the underhanded sale of provincial healthcare to for-profit, private companies. For me to boycott Loblaws in May will also mean boycotting my own Nova Scotia healthcare; the 150,000 or so Nova Scotians with no family doctor rely on the “Maple App”: a fee-based, two-tiered robot health service (which still has long wait times and doesn’t add a single new doctor to NS but only uses our existing doctors to stretch them even thinner). The Maple App profits … you guessed it … Loblaws!
Loblaws is far more sinister than grocery greedflation (although that is bad enough). They operate with impunity, and with disdain for Canada and disdain for our elected government; Loblaws are not amoral … they are immoral.
There is no reason for Loblaws to be receiving (taxpayer supported) handouts while even one single person in the organisation makes a 7-figure *BONUS*. I am glad that all of the political parties in Canada are working on behalf of Canadians to launch an inquiry against Loblaws, and to regulate grocery markup margins. All the parties except one, of course, the one that is works in unholy symbiosis with Loblaws and other oligarchs who would shun regulation, taxation, and with it any hope of responsibility for their actions on the economy, on people’s lives, and on the environment.
Personally, I am able to pay Loblaws prices for groceries (although I have been choosing to avoid supporting them for over a year already). My boycott is not about me. I make a good salary, my job has benefits, I have access to farm-to-table produce at my local market, I grow some food at home for myself and others, and I have a car to get to the variety of other grocery stores that aren’t gouging. (FYI, one local independent grocer I support often has the exact same items that are at the Superstore for fully HALF the price – and not on sale or as a loss leader; he assures me he makes a fine profit.) NO, I’m not boycotting for myself. I am boycotting so that no Canadian goes hungry in order for an oligarch — and oligarch who receives government subsidies — can play around with whether they can add even more zeroes onto the end of their already meaninglessly astronomical holdings.
After over half a century on this planet, I’ve participated in my share of boycotts. Some worked spectacularly. Some made modest gains. Some fizzled. I don’t know which way this one will go. But I do it because it’s the right thing to do.
You mention gross margins as stable, but their gross margin % has increased steadily over the years. Q1 2024 is 32.8%, 2% higher than Q1 2020; 8% higher than Q1 2014. Some of the change can be driven by changes in the types of food sold, but either way it means the company is moving towards more profitable (and likely more expensive) products.
Even if the margin % had stayed the same, that means they’re profiting significantly due to rising prices from suppliers. So consumers are paying not just the higher prices from suppliers that are passed on to us, but Loblaws added another 33% onto that increase.
Secondly, you mention the code of conduct for grocers without mentioning that Loblaws (and Walmart) won’t agree to it and have been actively lobbying against it. So, if the code of conduct is important, it makes sense to target Loblaws rather than Sobeys or metro or Costco.
While it’d be better to switch to independent grocers or local farms; boycotting one chain is more effective than boycotting all (because people need to eat). And if one store lowers their prices, the rest have to follow, or lose customers.
Great points. Also with food deserts and people having limited access to independents he seems to be throwing out arguments that do not reflect the situation
We should not only boycott Loblaws with high prices, don’t forget this is a domino effect with other grocery stores such as Sobeys and their sister stores Foodland and Lawtons. All of these stores should be boycotted as well. Their all in bed with each other.
The gross profit doesn’t make sense.
If Loblaws margins is 3.5% and your customers pay double for groceries you are getting more profit per customer…no?
If a customer pays $100 for groceries…that $3.5
If they pay $200 then that’s $7
They are incentivized to push up prices.
Also how much of the supply chain do they own? Or is that what their holding parent company owns.
We can also see their dividends go up again. So they are banking alot of cash here to do that
Blaming corporations for being psychopathic thieves is like blaming sharks for eating surfers. The sharks are just doing what’s in it’s natural.
The problem is a traitorous corrupt puppet government that allowed these oligopolies to form in the first place.
We are way beyond the point where voting can fix this country. We need a full scale national revolution.
Our democratically elected leaders need to face harsh punishment for their crimes against the people of Canada.