Walmart Canada lures more customers away from supermarkets, it says

Canadians are spending more of their weekly food budgets at Walmart Canada stores, the company said Tuesday, as the world’s largest retailer moves to make grocery items a “core” offering at Canadian locations.

Walmart said shoppers bought up more health and wellness and infant products in the latest three-month stretch compared to the same period a year ago, as well.

“We continue to maintain solid growth and gain share in a competitive and low-growth environment,” Walmart’s international head, David Cheesewright, said, citing market-share data provided by Nielsen.

Walmart has been expanding stores in recent years, converting most to “Supercentres” equipped with food aisles. The retailer also took over 13 former Target Canada locations in recent months. The expansion into grocery, which has accelerated in recent years, has helped offset slower growth in general merchandise sales, experts say.

‘Price advantage’

Walmart’s success isn’t exactly a state secret – its size advantage over others allows the retail behemoth to sell more products at lower prices compared to rivals, which now include Canadian supermarkets like Loblaw, Sobeys, Safeway and Metro among others. It also tries to keep costs for things like labour as low as possible.

‘The team continues to focus on our low cost operating model to drive a sustainable price advantage’

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And that cost advantage is compounding. It’s becoming increasingly difficult for conventional supermarkets to compete on price, experts say, as a lower loonie drives up costs of fresh foods and packaged products which must either be absorbed or passed onto consumers.

MORE: More fresh food, more problems for Canadian supermarkets

Walmart said Tuesday it will look to continue exploiting the lower prices it’s able to offer in Canada. “The team continues to focus on our low cost operating model to drive a sustainable price advantage.”

WATCH: As much as 30 per cent of the food that comes into a supermarket is thrown away before it hits the shelves, according to Alder Food Security Society. Lisa Wolansky reports.