“As a well-known company and Canada’s largest grocer, it is natural for Loblaw to be the focus of media and government and, of course, consumer frustrations,” Galen Weston said at the meeting. annual event of the food giant, Thursday. (Photo: The Canadian Press)
Loblaw (L) Chairman Galen Weston and the company’s new CEO, Per Bank, pushed back against what they called “misguided criticism” of the grocer as the boycott movement against the company is gaining momentum online.
“As a well-known company and Canada’s largest grocer, it is natural for Loblaw to be the focus of media and government and, of course, consumer frustrations,” Mr. Weston said at the annual meeting of the food giant, Thursday.
He added that while shareholders “may be troubled by these oft-repeated stories,” they should be assured that Loblaw will continue to act with integrity.
President and CEO Per Bank believes there is a lot of misinformation online about Loblaw. He reiterated that the company was not responsible for the rise in food prices. Inflation is a global problem, he said.
According to him, Canadians are under pressure and unhappy.
“Let me assure you that across all areas of the business, our colleagues are working hard to reduce costs and do things more efficiently. These efforts have allowed us to reinvest our savings to offset the impact of price inflation in our stores,” said Mr. Bank.
He said the company’s internal measure of food inflation was lower than Canada’s food inflation index for the past three quarters.
Weston attacks boycott
As of midday Thursday, more than 67,000 people had subscribed to a page on the social network Reddit where members complain about Loblaw and other major grocery stores. It was on this page that discussions around a boycott movement began.
Consumers are lamenting the significant increase in food prices in just a few years, while Canada’s largest grocers have reported higher profits.
The boycott is an example of “misguided criticism,” Mr. Weston argued. He believes grocers’ allegations of profiteering are false.
The company said Wednesday that it had contacted boycott organizers to arrange a meeting with Mr. Bank. An organizer confirmed that a meeting has been planned.
MM. Bank and Weston also criticized recent calls for stealing from Loblaw, which boycott organizers said they were not affiliated with.
“There is a group of people who are relentlessly propagating a narrative that they know to be false. And this is now being used to justify large-scale theft, Mr Weston lamented. I am optimistic and hope that Canadians will categorically reject this idea.”
In his comments, Mr. Weston referenced an earlier demand from the boycotters that the company drop prices by 15%, although organizers of the movement have since rescinded their initial demands and posted new ones on Reddit that include signing a code of conduct for grocery stores and committing to affordable prices.
This type of price drop “is equivalent to approximately three times the company’s total profit in a given year, which would have resulted in the end of our company, the loss of more than 200,000 jobs and billions of annual investments,” said Mr. Weston.
“The frustration is understandable. But this kind of expectation betrays a misunderstanding of what is really driving up food prices in this country,” he said.
Mr. Weston argued that Loblaw is working hard to bring more value to customers through private brands, off-price stores, new promotions and to fend off “unjustified” price increases from manufacturers.
The company said consumers are increasingly turning to its off-price stores, buying items on sale and switching to private labels to reduce their grocery bills.
On Wednesday, Loblaw reported that its profits rose nearly 10% year over year to $459 million.
Rosa Saba, The Canadian Press
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