Skip to main content

A Wal-Mart Pickup-Grocery employee helps a customer at a test store in Bentonville, Arkansas June 4, 2015. World’s largest retailer to start a fresh-food pick-up service in the Ottawa region in the coming weeks, with plans to eventually expand nationwide.

RICK WILKING/REUTERS

The grocery wars are about to heat up in Canada.

Discount titan Wal-Mart Canada Corp. will launch an "online grocery pickup" in the next few weeks in the Ottawa area, Simon Rodrigue, the retailer's senior vice-president of e-commerce, confirmed on Friday. The initiative, which expands Wal-Mart's burgeoning e-commerce offering to fresh food, is the start of the retailer's wider push into selling fresh fare online.

"Our intent is to continue building on our commitment to provide customers across Canada with convenient access to our grocery and general merchandise assortment and low prices," Mr. Rodrigue said.

Story continues below advertisement

Wal-Mart has been rapidly adding more food aisles to its bricks-and-mortar stores in giant supercentres, putting pressure on other grocers in a low-growth sector over all.

Now Wal-Mart's latest move to draw customers with a full grocery e-commerce offering will inevitably shake up the cutthroat $120-billion-plus segment as the discount titan expands its online business.

"As it gets rolled out to more markets, it will force the competition to react and offer the same thing because it's such a competitive market," said Peter Chapman, president of grocery consultancy GPS Business Solutions and a former executive at Loblaw Cos. Ltd.

Grocery e-commerce has lagged most other categories of online selling as retailers grapple with the costly logistics of picking, packing and shipping often bulky but low-margin products. The retailers also struggle to win shoppers' trust in picking unblemished fruit, vegetables, meats and fish.

At the same time, digital behemoth Amazon.com Inc. has been ramping up its grocery offerings in Canada and industry insiders suggest it will launch fresh foods in Canada at some point, as it has in other markets – raising the ante for all players. A spokeswoman at Amazon.ca declined to comment on Friday.

In Canada, major grocers have started to dip their toes in the digital-selling waters. Loblaw began testing last fall an e-commerce "click and collect" program at three of its stores in the Toronto area. It learned enough that it is ready to expand the test to 50 stores by the end of 2015, Bruce Burrows, chief information officer at Loblaw, said this week.

Sobeys has run e-commerce in Quebec for a while, while Longo's in Ontario offers GroceryGateway.com.

Story continues below advertisement

But e-commerce currently represents less than 1 per cent of Canada's more than $120-billion of annual grocery sales, according to global online market researcher Profitero. That compares with e-commerce making up roughly 5 per cent of all Canadian retail sales, said Keith Anderson, vice-president of strategy and insights at Profitero.

Even so, by the end of 2018, he expects grocery e-tailing to represent 3 per cent of total grocery sales, outpacing by three to four times the growth rate in bricks-and-mortar stores.

Retailers such as Wal-Mart and Loblaw that are moving early into the grocery e-commerce field "may have sustainable advantage," Mr. Anderson said.

Wal-Mart has the global heft of a worldwide company to find the economies of scale to do a full grocery e-commerce, he said. It also can borrow from its experience of selling food online at its British and U.S. divisions.

The Wal-Mart online grocery pickup will allow shoppers to order their groceries online from an offering that is smaller than the usual in-store offering – but at the same price as in the store, spokesman Alex Roberton said.

Customers will pick up their order at one of the participating stores; an employee will bring the groceries to the car or the customer will fetch them in the store. Wal-Mart will finalize how customers will pick up their order when it announces the service in the coming weeks, Mr. Rodrigue said.

Story continues below advertisement

"The majority of grocery items customers want on a weekly basis will be available for the grocery pickup service," Mr. Rodrigue added.

Report an error Editorial code of conduct
Tickers mentioned in this story
Unchecking box will stop auto data updates
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

Cannabis pro newsletter
To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies