The flyer for the Victory Meat & Produce Market, a small grocer in New Brunswick, recently featured fresh local turkey for $3.99 a pound, two bags of carrots or onions for $4 and a bunch of celery for $2.29 91裸聊视频� prices that rival its national competitors.
For 81 years, the independent store has offered quality products at affordable prices, earning it a loyal customer base despite the increasing dominance of national grocery chains.
91裸聊视频淲e have long-term relationships with suppliers and local growers, and staff that have been here for 20 years,91裸聊视频� said Alex Scholten, co-owner of the Fredericton store. 91裸聊视频淥ur customers are like family and I think those relationships are what has sustained us for so long.91裸聊视频�
The mom-and-pop style business has become increasingly rare in Canada91裸聊视频檚 highly consolidated grocery industry.
Loblaw, Sobeys and Metro make up more than half of all food retail sales in Canada, according to the Who91裸聊视频檚 Who 2022 report by industry trade magazine Canadian Grocer.
Add Walmart and Costco to the tally, and just five companies control three-quarters of grocery sales across the country, the report found.
That market concentration has come under intense scrutiny in recent months as food prices increased at their fastest clip in 40 years.
All five companies have faced accusations of profiteering, with executives summoned to testify before a parliamentary hearing in Ottawa where they were grilled by MPs about higher grocery bills.
The grocery executives denied the accusations, telling MPs that their margins on food are low.
91裸聊视频淭he truth is we are at the end of a very long food supply chain that has economic inputs at every step and stage,91裸聊视频� Empire president and CEO Michael Medline said to the committee in March.
The federal competition watchdog has separately launched a study into grocery store competition in Canada, questioning whether 91裸聊视频渃ompetition factors91裸聊视频� 91裸聊视频� in addition to extreme weather, higher input costs, Russia91裸聊视频檚 invasion of Ukraine and supply chain disruptions 91裸聊视频� could be affecting the price of food. The Competition Bureau plans to publish its findings in June.
The study comes as Ottawa conducts a long-promised review of Canada91裸聊视频檚 competition laws, one that strives to 91裸聊视频渕ake life more affordable for Canadians,91裸聊视频� Innovation Minister Fran莽ois-Philippe Champagne said when the review was launched in November.
Yet when it comes to groceries, just how much consolidation and competition issues influence the price of milk, bread or vegetables is complicated.
While Canada91裸聊视频檚 grocery sector is highly concentrated, it91裸聊视频檚 also very competitive, said Michael von Massow, a food economy professor at the University of Guelph in Ontario.
91裸聊视频淚 would argue that consolidation provides economies of scale,91裸聊视频� he said. 91裸聊视频淚 know the view that there91裸聊视频檚 value in size is unpopular 91裸聊视频� but it probably helps prices. We have a very competitive consumer market for food.91裸聊视频�
The current distrust of grocers likely stems in part from Canada91裸聊视频檚 bread price-fixing scandal, von Massow said.
In 2017, George Weston Ltd. and Loblaw Companies Ltd. revealed that both participated in an industry-wide bread price-fixing arrangement for over a decade.
Canada91裸聊视频檚 competition watchdog alleged in court documents in 2018 that at least $1.50 was artificially baked into the price of a loaf of bread during the 16-year bread-price-fixing conspiracy involving the country91裸聊视频檚 largest bakery wholesalers and grocery retailers.
The Competition Bureau says its investigation into bread price-fixing is ongoing.
The scandal has given Canadians good reason to be skeptical about the cause of high food prices 91裸聊视频� especially as grocers post significant profits, von Massow said.
91裸聊视频淲e feel the pinch at the grocery store,91裸聊视频� von Massow said. 91裸聊视频淲e91裸聊视频檙e looking for someone to blame and that91裸聊视频檚 who91裸聊视频檚 charging us more.91裸聊视频�
But food inflation is due to a number of inflationary pressures that affect the entire supply chain, he said.
Indeed, Fredericton91裸聊视频檚 Victory Meat & Produce Market has seen costs rise more or less on par with the large grocers.
Transportation, utilities, food and labour costs have all soared over the last couple of years, Scholten said.
The store works hard to keep costs low, but Scholten said prices have still gone up.
While more competition in the grocery sector would be a good thing, he said it might not make that much of a difference with prices.
91裸聊视频淚t91裸聊视频檚 just the environment we91裸聊视频檙e in right now,91裸聊视频� Scholten said. 91裸聊视频淓verybody is facing significant cost increases.91裸聊视频�
Still, Canada91裸聊视频檚 big grocery chains take advantage of their size and possibly even engage in uncompetitive behaviour, von Massow said.
91裸聊视频淚 think where they91裸聊视频檙e leveraging that market power is back up the supply chain to suppliers,91裸聊视频� he said. 91裸聊视频淚t can make it tough for smaller, independent grocers to compete because they can91裸聊视频檛 buy as well.91裸聊视频�
Indeed, one of the keys to Victory91裸聊视频檚 success is its wholesale business.
91裸聊视频淲e offer both retail and wholesale products, so we91裸聊视频檙e able to build a volume that91裸聊视频檚 sufficient enough to give us the buying power to compete with much bigger competitors,91裸聊视频� Scholten said.
Michael Graydon, CEO of supplier industry group Food, Health & Consumer Products of Canada, said there are both benefits and drawbacks to concentration in food retail.
91裸聊视频淭he grocery market is consolidated, there91裸聊视频檚 no question about that,91裸聊视频� he said. 91裸聊视频淭here are some benefits. They are very sophisticated retailers with a robust supply chain, so getting products from the manufacturers to distribution to store tends to be fairly efficient.91裸聊视频�
It91裸聊视频檚 also easier selling to five companies rather than 25 for some suppliers, he said.
But there are downsides as well, Graydon said.
91裸聊视频淭here is a power imbalance and this is fundamentally why we91裸聊视频檙e working toward a code of conduct,91裸聊视频� he said.
The industry-led Canadian grocery code is expected to be released in the coming weeks.
The document is expected to increase 91裸聊视频渇air and ethical dealing91裸聊视频� across the grocery supply chain in Canada, according to a draft version of the code viewed by The Canadian Press.
91裸聊视频淚t establishes some rules for engagement,91裸聊视频� Graydon said. 91裸聊视频淚t takes away a lot of that unilateral decision-making and imposing terms on manufacturers without negotiations.91裸聊视频�
But the drawback of levelling the playing field between grocers and suppliers could be even higher prices, von Massow said.
If you limit the degree to which grocers can put pressure on suppliers, he said it could take money out of the grocers91裸聊视频� pockets.
91裸聊视频淭hey91裸聊视频檙e either going to eat that 91裸聊视频� and it will have no impact on prices 91裸聊视频� or they91裸聊视频檙e going to pass at least some of it on to consumers,91裸聊视频� von Massow said.
91裸聊视频擝rett Bundale, The Canadian Press
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