Canada’s kind and gracious grocery overlords have bestowed upon civilians a most wonderful gift. This treasure, glistening in the sun’s brightest yellow and with words of bold black tourmaline, shall adorn the homes of all Canadians from Victoria to St. John’s, Whitehorse to Toronto. Man, woman and child will, for the next three months, rejoice in this bounty at a cost equivalent to what it is now.
By his grace, our benevolent leader – Loblaw chairman and chief executive officer Galen G. Weston – has decreed that his company’s fortunes must be shared with the peasants and penniless wanderers of the nation, now that said fortune has grown tremendously thanks to the peasants and penniless wanderers of the nation. This gift will not come in the form of increased wages for the labourers who toil in his trenches, who are as burdened as any of us by the rising cost of goods, but rather, in incentives for the rest of us to purchase their spoils.
Indeed, the company, whose first-quarter profits rose nearly 40 per cent compared with the same period last year, would like Canadians to believe that it is doing consumers a great service by freezing the price of products under its house No Name brand for the next three months. Mr. Weston wrote in an e-mail to customers Monday that the “price of an average basket of groceries is up about 10 per cent” this year, and that he and his company share in the frustrations of the average consumer. “Maddeningly,” he wrote, “much of this is out of our control.”
Yes, poor Loblaw had no choice but to pass along price increases to its customers to keep up its bottom line, which somehow grew enormously even though Loblaw, we are to infer, was simply trying to maintain its margins. Likely some of the company’s first-quarter windfall was the result of record-high sales of its No Name brand, which delivered higher profits for the company as Canadians attempted to cut down on their food costs by purchasing discount products. And what better way to maintain or exceed those record-high sales than announcing a temporary freeze on those very same items?
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Of course, a freeze would have been more beneficial to the average consumer had Loblaw made this announcement before raising the prices of many of its No Name products. In May, you could buy a 908-gram box of frozen No Name chicken wings for $11.99 from Real Canadian Superstore in Ontario; now, the price is $13.99. In June, four litres of No Name vinegar was priced at $1.99; now, it’s $2.29. Most regular shoppers will be able to rattle off the price changes they’ve observed over the last few months from memory. And though a temporary reprieve from additional price increases is certainly better than nothing, the announcement was made after the company has already profited from inflation.
But is it fair to be so cynical about a company that offered customers a $25 gift card for fixing the price of bread with its competitors for 14 years? (Think of how many No Name products shoppers could have bought with that four years ago!) And wasn’t Mr. Weston generous in announcing “hero pay” for his front-line workers during the first wave of the COVID-19 pandemic, which he clawed back a few months later even though the risk to workers was the same, and the pandemic anything but over? (Other Canadian companies, such as Chapman’s Ice Cream, made its pandemic pay boost permanent.)
Maybe this price freeze announcement isn’t a thinly veiled marketing scheme intended to boost sales by enticing customers into Loblaw stores, or to boost profits by directing consumers to store-brand products. Indeed, maybe this really is just the company giving back – for three months – out of a recognition that so many Canadians are struggling, especially those in service jobs working minimum wage. And perhaps the best way for a company like Loblaw to give back is not to help out its own minimum-wage workers, but to freeze the price of a tub of sour cream at $2.29?
So let us give thanks to Canada’s supermarket supremes, eager to “help Canadians hit the brakes on food inflation,” now that inflation is already easing. May their selflessness inspire the nation for a fixed amount of time, and may those in their marketing department be richly rewarded.
Robyn Urback