Sobeys CEO Michael Medline says he has seen sales increase at its stores beginning Feb. 28, which were clearly tied to the public’s concerns about the novel coronavirus.J.P. Moczulski/The Globe and Mail
Retailers are navigating “truly unprecedented territory” as people’s concerns about the new coronavirus ramp up, Empire Co. Ltd. CEO Michael Medline told analysts on Thursday morning as the Sobeys parent company reported its third-quarter earnings.
The owner of Sobeys, Safeway, FreshCo and other grocery banners has seen sales increases at its stores beginning Feb. 28, which were clearly tied to the public’s concerns about the virus, he said. With the declaration by the World Health Organization that the illness known as COVID-19 is now characterized as a pandemic, those buying patterns accelerated further – with items such as cleaning supplies, non-perishable foods, health and hygiene and paper products all seeing heightened demand.
In an interview with The Globe and Mail, Mr. Medline said he believes the retail industry must work collaboratively with government officials in their response to the virus.
How are you preparing for the next few weeks and months?
The way we view ourselves is basically as an essential service, as grocers. People have to eat. I view pharmacies the same way, and gasoline stations. They’re essential to people living their lives. So we take this whole thing incredibly seriously. We have to be able to keep our customers safe, and we have to keep our stores open. Stores have to be open. We sell over 20 per cent of groceries in this country. … Like most companies, we made sure that our employees were safe and doing the right things. As always, our stores are clean, and we’re taking it up another notch. … It’s essential that that food supply chain, which is working very well right now, continues to operate properly so that people can get the products they need, especially groceries. [Employees are also cleaning high-traffic areas more frequently.]
Do you see any possibility for disruptions to the supply chain?
We have not seen disruptions to the supply chain. Like every other grocer, we’ve seen some shortages of certain items. I think we’re going to see that spread out over a number of other items, as people make decisions to protect their families. … They’re buying predictable things to take care of yourself if you’re quarantined or sick. I don’t see that as any sort of bad behaviour. In fact, Canadians are doing the right thing. We haven’t seen any issues in the stores, in terms of people hoarding. We don’t see that.
How has traffic to your stores changed?
We’re seeing more customers coming to our store than I’ve ever seen since joining Empire. It started around Feb. 28; it accelerated Sunday; [on Wednesday] we saw a ramp up again.
Are you involved in any industry-wide conversations, or further conversations with government officials?
We are a key member of the Retail Council of Canada, and we have our own connections to government, to public health, that we’re utilizing. But I think it’s really important that there’s a concerted and aligned effort to make sure that the food supply chain stays as strong as it is today, and that our customers and [staff] are safe. So I think that has to be very well co-ordinated with government and between the different retailers – especially food retailers and pharmacy. So I am aware, and in fact, [on Thursday afternoon] I have a call with [Retail Council CEO] Diane Brisebois to discuss some of these issues. The Retail Council is adept at handling this, and there needs to be co-ordination.
Are you seeing any employees who might be more hesitant to come into work, or are you expecting any changes in how employee shifts are managed?
I’m checking on that all the time. … People are nervous, and they’re scared out there. It’s uncharted waters. They don’t know what to expect. I want to make sure that everyone feels safe coming to work. So far, we have no issues whatsoever staffing our stores. But we’ve got to communicate with people. We’ve got make sure everyone is safe.
Are there any communication efforts going out to your employees, to tell them to stay home if they are feeling under the weather, and they won’t be penalized?
There sure are. [Employees who can work remotely are being encouraged to do so.] We’re telling people to stay home if they are sick. But we’re not aware of any issues right now.
This interview has been edited and condensed.
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Susan Krashinsky Robertson