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Canadians were quick to criticize grocery giant Loblaw Co. for planning to reduce discounts on expiring items at its stores, revealing the public’s true opinion of the company, one expert said.
“They’re realizing now they probably have more than an economic interest in Canada,” Bruce Winder, a retail expert told CTV News Channel. “Canadians see them almost in a paternal way, not unlike our government, and they have a responsibility here beyond just making money.”
Grocers have to increase prices when suppliers increase costs, Winder said, which puts them in a difficult situation in the “low margin” industry.
“Having said that, bigger companies are being asked to sort of take on that paternal or maternal role, of not just focusing on profits, but also the planet and society,” he said.
Earlier this week, Loblaw revealed it would reduce the discount difference from 50 per cent to 30 per cent on expiring in-store items.
“The timing of this decision, in January 2024, when many consumers were grappling with financial challenges, did not sit well with Canadians,” Sylvain Charlebois, director of Dalhousie University’s Agri-Food Analytics Lab, said in a statement.
The swift backlash from experts, Canadians and government officials, prompted Loblaw to reverse the decision, showcasing how the company could be prompted into action, Charlebois said.
“Most Canadians can appreciate that retailers have the flexibility to adjust their discounting policies to stay competitive,” he said.
This is not the first time Loblaw has found itself at the centre of a public relations crisis, Charlebois added.
In 2016, the company abandoned a decision to carry French’s products. At the time, consumers boycotted stores to support tomato farmers in Leamington, Ont., where a Heinz plant had been saved by a contract with French’s to make tomato paste.
“This time around, the public outcry was driven by sheer desperation,” Charlebois said.
Canadians are struggling with the increased cost of living, from housing and food to gas and everyday essentials. Prices keep climbing with more Canadians turning to food banks.
Experts were shocked at the initial Loblaw decision and implored the company to reconsider during a time when food inflation continues to increase.
“They really shouldn’t have done this in the first place,” Winder said. “I think it might be a bit of a turning tide for Loblaw.”
According to Charlebois, the 30 per cent discount on expiring items is common practice among other grocers in Canada, however, he believes Loblaw could set a new precedent.
“If we can encourage other grocers to follow Loblaw’s lead by offering a 50 per cent discount on expiring food items, that would truly be a welcome development,” he said.
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