PROFITEERING
Canada's Competition Bureau obtains court orders in investigation into Loblaw, Sobeys owners
, The Canadian Press
LOBLAW COMPANIES LTD (L:CT)
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The Competition Bureau has obtained two court orders requiring the parent companies of Loblaws and Sobeys to hand over information related to its investigation into alleged anticompetitive conduct.
The bureau is investigating the use of property controls in the grocery sector, which are clauses in lease agreements that restrict other potential tenants and their activities.
The bureau said these controls are hampering competition in the grocery sector.
The competition commissioner applied in Federal Court in May to order Empire Cos. Ltd. and George Weston Ltd. to hand over records about real estate holdings, lease agreements, customer data and other records.
The bureau said Tuesday this information will help determine whether Sobeys and Loblaw are imposing anticompetitive restrictions that negatively affect competition in the grocery industry. It said there is no conclusion of wrongdoing at this time.
Spokespeople for Empire and George Weston did not immediately respond to requests for comment.
Empire previously pushed back against the investigation, saying in a separate court application that the probe gives the commissioner “the appearance of a lack of independence." It denied that property controls are anticompetitive.
In May, the Competition Bureau said it had filed a motion to strike Empire’s application for judicial review.
Spokeswoman Sarah Brown confirmed Tuesday that motion was granted, but said Empire is appealing the decision.
Loblaws’s parent company is co-operating with the bureau’s review, spokeswoman Catherine Thomas said in May on behalf of George Weston Ltd.
"Restrictive covenants are very common in many industries, including retail. They help support property development investments, encouraging opening of new stores and capital risk-taking," she said in a statement at the time.
The commissioner’s probe is focused on the companies’ operations in Halifax, but also more broadly across the country.
The court documents filed in May describe Empire’s and George Weston’s holdings in real estate investment trusts, or REITs, which count the companies’ own grocery banners as major tenants.
Through a subsidiary, Empire holds a 41.5-per-cent interest in Crombie Real Estate Investment Trust, while George Weston has a controlling ownership interest of 61.7 per cent in Choice Properties Real Estate Investment Trust.
The Competition Bureau revealed its investigation into the use of property controls in the grocery sector in February.
At the time, deputy commissioner Anthony Durocher told a House of Commons committee that property controls could be holding back growth for independent grocery stores and chains, and could also be a barrier for foreign players looking to enter the Canadian market.
Industry Minister François-Philippe Champagne has said he's looking for a foreign grocery to enter Canada and boost competition.
-- With files from Darryl Greer
This report by The Canadian Press was first published June 11, 2024.
Loblaws boycott: These Canadian
shoppers say they’re done with the
grocery giant forever
The boycott of Loblaw-affiliated stores was started by a
group on Reddit who wanted to pressure the chain
during the month of May. It's still going for some
shoppers
Elianna Lev
Tue, June 11, 2024
Loblaw chairman Galen Weston is frequently subjected to direct criticism by Canadian shoppers taking part in the boycott.
What started out as a May-long boycott of Loblaw and its affiliated stores across the country is still going strong for many Canadian shoppers who are vowing to shun the grocery giant and its chains indefinitely.
"Loblaws Is Out of Control," the Reddit group that organized and launched the initial boycott, is now encouraging Canadians who are able to take part to continue the boycott of the giant's stores, like the flagship Loblaws, Shoppers Drug Mart, Real Canadian Superstore, No Frills and Zehrs, among others.
The Reddit forum was launched in November by Emily Johnson of Milton, Ont., and now boasts nearly 90,000 members. The organizers of the boycott chose to target Loblaw and its affiliates, rather than other grocery chains like Sobeys or Metro, because of its tremendous reach. By the giant's own data, more than 90 per cent of Canadians live within 10 kilometres of at least one of Loblaw's 2,400 stores.
Yahoo Canada spoke to several people who are members of the Reddit group "Loblaws Is Out of Control" who said they are continuing their boycott past the month of May, into June, and indefinitely. Six Canadians spoke to us about why they're doing it and how they're managing to avoid the grocery and drug store empire long term.
I'm amazed at how this boycott has succeeded and brought together so many Canadians who probably otherwise disagree on many issues.
The following testimonials were shared with Yahoo Canada by Canadian shoppers across the country who are members of the "Loblaws Is Out of Control" Reddit forum. Some entries have been edited for length and clarity.
Grace Wong is a 58-year-old who lives in Edmonton, Alta., with her partner and 19-year-old son. She owns a computer repair shop. A recent post of hers on the "Loblaws Is Out of Control" subreddit garnered lots of attention when she announced she'd used up all her PC Optimum points and would be closing her account.
Suzanne is a 63-year-old who lives alone in London, Ont. She is a retired lawyer.
Melanie is a 61-year-old who lives alone in Winnipeg, Man. She is retired.
PJ is a 65-year-old who lives alone in Victoria, B.C. She is a customer service associate.
Erin is a 46-year-old who lives alone in Campbell River, B.C. She is a social worker.
Rick is a 69-year-old who lives in St. Johns, Nfld., with his wife and adult son.
Real Canadian Superstore in Edmonton. (Photo by Artur Widak/NurPhoto via Getty Images)
Canadians shoppers learned of Loblaws boycott from Reddit
Grace: I learned about the boycott pretty much how everyone else did — on social media. I joined the subreddit, and I thought they made a lot of good points.
Suzanne: There's a widening gap between rich and poor in this country. I feel that corporations like Loblaw are deliberately and directly contributing to that. In one month, the Reddit community has done more to raise awareness and fight back than any level of government has. I refuse to set foot [in the stores of] any Weston-owned company. They have lied to Canadians and scammed us for decades.
Melanie: I joined the boycott because it was obvious to me that things had gotten out of hand. I was not aware of how crazy they'd gotten until I started learning from my fellow boycotters.
PJ: I'm amazed at how this boycott has succeeded and brought together so many Canadians who probably otherwise disagree on many issues. I've been part of boycotts in the past but never one so successful and impactful.
Erin: I remember on one of the Reddit groups, someone posted a picture of Christmas ornaments that were $80. I remember looking at that and thinking, ‘If that’s $80, how much is Christmas dinner?’ Then the whole "Loblaws Is Out of Control" started and I learned about all the things like shrinkflation, and the bread price fixing, and I was finally annoyed enough ... And it’s been really cool to watch it sort of taking off.
It was obvious to me that they'd gotten out of hand. I was not aware of how crazy they'd gotten until I started learning from my fellow boycotters.
Longueuil,Quebec,Canada-Loblaws supermarket from parking lot
The straw that broke the camel's back: Why Canadian shoppers have had enough of Loblaws
Grace: My grocery bill every month, even though it’s just three people, is absolutely horrific.
Suzanne: It makes no financial sense to pay for the privilege of shopping at a chain that treats customers as if they were criminals. I despise the self checkouts and refuse to use them for two reasons; Widespread automation obviates the need for a human employee, costing someone a job. And second, I don't work there, so why would I do this myself?
Melanie: It was actually back near the end of last year that I blew off Superstore. I did up a cart and thought ‘Geez that's rather high.' I did a matching cart at Walmart and Walmart won. I did it once more after the new year and same thing. I haven't given them anything since.
PJ: As a senior, I'm incensed at price gouging. When I started seeing people in that subreddit posting photos of prices at Loblaws I couldn't believe how badly they treat their customers. Every grocery chain dances that fine line between not losing customers, and making the biggest profit they can. But Loblaws does it with such contempt for its customers.
Erin: I just did a big grocery shop because I just moved…if I had gone to Superstore, it would have been close to $1,000, but at Walmart it was $400. I was shocked. I don’t think I’ll ever go back.
When I started seeing people in that subreddit posting photos of prices at Loblaws I couldn't believe how badly they treat their customers.
Toronto, Canada - August 26, 2021: A Costco delivery truck on the street in Toronto, Canada. Costco is an American corporation which operates a chain of membership-only big-box retail stores.
Life 'has gotten easier' since the boycott, with 'plethora' of choice
Grace: The nice thing about living in a large metro area, there’s lots of options. I shop at Sobeys, organic markets, HMart, which carries all the same stuff as T&T, and Costco.
Suzanne: I have been impacted by the boycott positively only. I have saved in excess of $400 this month alone and will continue to shop at the London food co-op. London has a few independent markets, and I go to a butcher shop run by one guy who learned the business in his country of origin, Hungary. He sells beautiful bacon. For $8.99/lb, you get actual fresh, thick cut bacon. At Loblaws and its affiliates, you'd pay $14 for a package of whisper thin fat with very little meat on it. I spend much less there for better quality food and I'm supporting a small business. For produce, I use a delivery service where a $40 box will feed two households — mine and my neighbour's — for roughly a week.
Melanie: Canadian families are just trying to eat. I'm lucky that I can afford to shop where ever I want, really. Groceries are cheaper everywhere that isn't Loblaws, Sobeys, Safeway and Save On. It's not that far out of anyone's way here — especially with cheap delivery ... My shopping habits are limited to who will deliver. I now have three deliveries every week: Giant Tiger, Dollarama and Walmart.
PJ: There's a plethora of choices here, I'm really lucky. Victoria also has a Chinatown with lots of affordable fresh produce. I can't drive due to a vision issue and I've become a ninja shopper, scouring the flyers every week, planning my food buying around loss-leader items, planning my bus trips, and calculating how much I can carry. It's very satisfying to score great deals. And if I can do that, anyone with a car can do it much more easily.
Erin: Loblaws is at least $6 for pickup, and at least $10 plus tip for delivery. At Walmart it’s free to pick up, which means now I don’t have to plan my grocery shopping. I can literally put an order in while I'm sitting at work and pick it up after work, it doesn’t cost me anything. Life has gotten easier because of this boycott.
Rick: I've been using local markets, butchers, bakers, farmers markets, Walmart and Costco. I moved my prescriptions to Costco and found big savings.
I spend much less there for better quality food and I'm supporting a small business.
Loblaws CEO Per Bank is photographed at a Suppliers Summit in Toronto, Thursday, May 16, 2024. THE CANADIAN PRESS/Chris Young
Loblaw grievances pile up for Canadian shoppers
Grace: For me, it was sort of a game to see how many [PC Optimum] points I could get. But if I’m spending thousands of dollars to get $100 in points, is that worth it? Maybe not. Now that I’ve used all the points I’m cancelling my PC Optimum membership.
Suzanne: I am going out of my way to avoid [Loblaw-affliated stores]. I'm terminally ill and have a substantial amount of expensive prescriptions - those were transferred to [a local] pharmacy that offers free delivery and substantially lower dispensing fees. I think they have lost this chunk of customers forever. There's no way to win me back. I also cancelled my PC credit card. [They employ] practices that are emblematic of the arrogance and contempt with which they view their own customers ... like selling underweight and expired food, to cutting the discount on expiring food from 50 per cent off to 30 per cent off.
Melanie: I got a lovely steak yesterday that I wouldn't dare get from Superstore. The attitude of [Loblaw Chair Galen] Weston and [CEO Per] Bank are over the top and they are so dismissive and condescending.
PJ: People have realized that Loblaws stores charge on average 25 to 30 per cent higher prices for the same items ... assuming that [customers] will just suck it up and pay too much.
Erin: I remember when Superstore first came to where I lived, they were the cheapest. You could save money shopping there. I don’t know when it changed, but it changed.
Rick: It's simple economics ... You can get one deodorant for $9.99 at Shoppers Drug Mart, or five of the same at Costco for $14.99!
I think they have lost this chunk of customers forever. There's no way to win me back. I also cancelled my PC credit card.
These Canadians say they will boycott Loblaw forever
Suzanne: I will keep boycotting them forever. I have a responsibility to do my bit for my son's generation and those that follow to at least give them a fighting chance to have a comfortable life.
Melanie: When I think of all the money that Loblaws has literally stolen from Canadian families on food of all things it makes me sick. Like many, I won't give them my money ever again.
PJ: I’m choosing to keep boycotting for purely selfish reasons: More money in my bank account at the end of the month. I don't see this as anything but a permanent boycott. Once you've altered your routine and learned a new store layout, once you've brought home produce that costs 30 per cent less and it lasts a week in the fridge, why would anyone go back? Only a masochist would.
Erin: Canadians can really make change. The boycott is working. The more people that join, the faster and more efficient it will work.
Grace: I’m boycotting permanently because I’m getting sick and tired of paying so much for what seems like not an awful lot, and finding out after the fact that you go shop elsewhere and you can get it for a hell of a lot cheaper than Loblaws.
Rick: I'm not going back because I'm saving too much money and meeting local businesses.
When I think of all the money that Loblaws has literally stolen from Canadian families on food of all things it makes me sick.
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