Competition leads to grocery wars in Calgary

CALGARY- Their short-lived strike is over, but the worker unrest at Superstore is a sign of the pressure facing businesses in Calgary.

There is more competition than ever before in the grocery business, prompting many to try and find ways to cut costs, by reducing staff hours and shifts.

“They do have in quite a number of categories and very small margins, so when they’re competing they really have to manage their costs,” explains Debi Andrus from the Haskayne School of Business. “It really is about cost containment and cost control.”

Just a decade ago, the choices were really only giants like Safeway, Co-op and Superstore, but as the city has grown new chains have moved in. Save-On Foods is building three new stores, No Frills is expanding, and Sobeys has bought both IGA and Safeway. Add to that new competition from Wal-Mart’s Supercentres along with food offerings from Target and Shoppers Drug Mart, and the market has become saturated.

“Consumers now have this wide range of choices, and the stores now have to be competing for that one market,” Andrus adds.

The changes mean more savings and selection for shoppers, and business are scrambling to adapt.

“There are plenty of other reasons to shop where you shop, and to buy what you buy, and the more other factors come into it,” says David Allwright, dean of business at Bow Valley College. “Is it organic, is it locally sourced, do you have a better array of products.

“It really does force retailers grocers to look at what value they’re offering their customers.”

Increased competition has also changed shopping patterns, with very few people still buying all of their groceries at one store.