Canada’s grocery industry is rapidly shifting toward discount formats as consumers grapple with persistent food inflation, according to Sylvain Charlebois of the Agri-Food Analytics Lab at Dalhousie University.
Speaking about current grocery trends, Charlebois said major chains are accelerating discount store expansion to meet growing demand from cost-conscious shoppers. He pointed to Metro’s plan to open 12 Super C locations, comparable to No Frills stores operated by Loblaw Companies Limited. Loblaw, he noted, recently announced plans to open 70 stores, convert several others, and retrofit nearly 200 locations. Discount banners anchored by private label products are currently strong performers for large grocers as shoppers seek value.
However, Charlebois’ analysis shows Canada’s grocery store density is declining. The country now has about 19 to 20 stores per 100,000 people, down from more than 22 per 100,000 in 2020 — a roughly six per cent drop. By comparison, the United States has held steady at 19 stores per 100,000 residents for several years. He suggested the shrinking per-capita store count raises competitive concerns.
On food prices, Charlebois said Canada currently has the highest food inflation rate among G7 nations. Even excluding the impact of last year’s GST holiday, he indicated Canada would still lead the group. Consumers are seeing elevated prices at meat counters, in center-store packaged goods, and increasingly in vegetables.
Geopolitical tensions and tariff uncertainty are also complicating food trade. Charlebois said Washington’s approach aims to slow globalization, creating unpredictability at the border despite some exemptions under existing agreements. He emphasized that the upcoming review of CUSMA will be critical for the agri-food sector.
Meanwhile, ethnic grocers and urban formats are expanding, offering competitive pricing and alternative supply chains that resonate with today’s value-driven consumers.
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