Greenhouse Canada

News
Sobeys launches eight FreshCo stores in Ontario


May 12, 2010
By By Anne-Marie Tobin The Canadian Press

May 11, 2010, Toronto
—A new player
touting itself as “Fresher, Cheaper’’ joined the field of discount
grocers in
Canada on Wednesday, as Sobeys Inc. transformed eight locations into
FreshCo
stores.


May 11, 2010, Toronto —A new player
touting itself as “Fresher, Cheaper’’ joined the field of discount grocers in
Canada on Wednesday, as Sobeys Inc. transformed eight locations into FreshCo
stores.

The former Price Chopper stores are in Brampton and Mississauga, Ont.,
the vanguard of “dozens’’ that will be switched over in the next year and a
half, Sobeys president and CEO Bill McEwan said in an interview prior to the
grand opening.

Advertisment

“This isn’t just a conversion or a
renovation – this is the launch of a new brand,’’ he said, describing the
bright white buildings that sport a big black FreshCo sign. “The concept is a
result of about 12 to 18 months of extensive research and looking at where do
we go next, based on the changes in the consumer landscape, particularly in the
GTA (Greater Toronto Area) but across Ontario overall.’’

There’s a recognition that each
store has a different clientele. The new stores offer multicultural and ethnic
foods tailored to the needs and choices of people in the neighbouring
communities.

“In Brampton, the South Asian
population has grown 250 per cent in about 12 or 13 years, and there are
varieties of produce that are important and relevant and required to satisfy
that marketplace,’’ McEwan noted.

Sobeys Inc. (TSX:EMP.A) has more
than 1,300 stores from coast to coast that include Sobeys, IGA, Foodland,
Thrifty Foods and Lawtons Drug Stores. In Ontario, there are 79 Price Choppers
and now eight FreshCo stores.

About 60 per cent of the stores
nationwide are run by franchisees, McEwan said.

Customers entering a FreshCo store
will first encounter fruit and vegetables in a great hall immediately inside,
which flows into a deli area, a bakery market and a local cheese and meat
market.

“From there you transition into an
area that’s filled with pallets of high-value merchandise, which is a hallmark
feature of any discount outlet, but we’ve merchandised it in a way that it’s
very, very abundant,’’ McEwan said.

There won’t be a full-scale change
from Price Chopper to FreshCo, he said, but he met with franchisees Tuesday and
they were enthusiastic about the concept. “Market by market, if we determine
through our market research . . . that a FreshCo is a requirement, I can’t
imagine a single franchisee not wanting to proceed with it,’’ McEwan said.
“We’re not prepared to say where’s next for competitive reasons, but in some
cases it won’t make sense to convert from a Price Chopper because . . . (it)
actually provides a better option in that marketplace. It’s not a franchisee’s
decision or our decision – we do it together.’’

The discount segment of the
marketplace is more developed in Ontario than almost anyplace else in North
America. “A full 35 to 40 per cent of the food shopping is done in the discount
market, so to compete and participate in the retail grocery industry in Ontario
you have to have a strong discount format,’’ he said.

The FreshCo stores aren’t fancy or
expensive because the effort is being put into low prices and high-quality
products, he said. “It’s not about the decor – but it’s attractive, it’s clean,
it’s contemporary, it’s functional – and the flow is such that you can get
through there with less inconvenience the way it’s laid out.’’


Print this page

Related



Leave a Reply

Your email address will not be published. Required fields are marked *

*