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Five of the largest Canadian grocery chains met with Industry Minister Francois-Philippe Champagne to deliver plans to stabilize food prices. The heads of Loblaw, Sobeys, Metro, Costco, and Walmart met with Champagne in Ottawa last month to confront food prices that increased 6.9% in August compared to last year, while the overall inflation rate hit 4% (down from a recent high of over 11%), reports Canadian news outlet CBC News.
Plans from the grocery chains include promises of more discounts, price-matching campaigns, and price freezes, and the minister told them the government wants their plans to stabilize prices by a Thanksgiving deadline.
Champagne, who said the meeting was the first time all five CEOs had been brought together by the federal government in the same room, said that the measures will bring a much-needed and more competitive marketplace, while also benefiting Canadians. He also said that Canadians should expect to see grocers start rolling out these plans “within days.”
A June study from independent consumer agency Competition Bureau reported that Canada’s grocery industry was too concentrated, with most Canadians buying groceries from one of five companies: Loblaws, Sobeys, Metro, Costco, and Walmart. It also called on the government to encourage new market entrants to bring down prices.
According to the study results, the majority (81%) of Canadian consumers said they buy groceries one to three times per week — and the breakdown of those trips looks like this:
- 49% Loblaws and the stores it operates
- 28% Sobeys and the stores it operates
- 25% Walmart
- 22% Metro and the stores it operates
- 18% Costco
- 28% Other grocery stores
Champagne is being pushed to explain how he can ensure government pressure will result in grocers taking action on their promises.
“I think we’ve been a catalyst to bring [these actions] to the forefront,” he said. “This is day one of a process … What we have achieved would be a catalyst for more measures, faster measures, and long-lasting measures.”
He also hinted that the examples he gave were just a sampling of the plans that were presented as he wouldn’t reveal more details in order to ensure fair competition, and he sees this as an ongoing process. Champagne added that the government is creating a new task force within the Office of Consumer Affairs to monitor and report on actions taken by the grocery chains.
Representing Metro, Loblaw, and Sobeys, The Retail Council of Canada said that the companies have had “good faith” conversations with the government, but it also needs to put pressure on food manufacturers and producers to play their part in stabilizing prices as well. “It therefore remains critical that all members of the complex supply chain address their respective roles in food pricing,” a statement from the council said.
Champagne said that he also has had discussions with producers and manufacturers in recent weeks.
However, Finance Minister Chrystia Freeland, who joined Champagne at his press conference, said tax measures are still an option.
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