Sobeys: Wikis

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Sobeys Inc.
Type Private
Founded Stellarton, Nova Scotia (1907)
Headquarters Stellarton, Nova Scotia
Key people William G. (Bill) McEwan, President & CEO
Industry Retail (Grocery) [1]
Products Grocery
Revenue Green Arrow Up.svg $14.765 billion CAD (2009)[1]
Net income Green Arrow Up.svg $226 million CAD (2009)[1]
Employees 75,000 (2005)
Subsidiaries Big 8 Beverages
Website www.sobeys.com
www.sobeys.ca (Retail site)

Sobeys is the second largest food retailer in Canada, with over 1,300 supermarkets operating under a variety of banners. Headquartered in Stellarton, Nova Scotia, it operates stores in all ten provinces and accumulated sales of more than $14 billion CAD in 2009. It is part of the conglomerate Empire Company Limited.

Contents

History

In 1907, Sobeys was founded in Stellarton, Nova Scotia by John W. Sobey as a meat delivery business in Stellarton, Nova Scotia. In 1924 his son Frank H. Sobey convinced him to expand into a full grocery business, serving the industrial Pictou County region. From that point until his death, Frank was the driving force behind the business. Sobeys opened its first self-serve supermarket in 1949.

The chain eventually expanded throughout Atlantic Canada. During most of the second half of the 20th century it was the region's dominant grocer. In the 1980s, Sobeys expanded into southern Ontario, challenging Loblaws on its "home turf", thereby igniting what came to be a nationwide battle for market supremacy.

Sobeys had significant stakes in New England grocer Hannaford and Quebec grocer Provigo until the 1990s.

In 1998, Sobeys became the second-largest grocer in the country after purchasing the Oshawa Group, owners of the IGA franchise across Canada, along with several regional chains in Ontario, in addition to various food service and wholesale companies.

In 2001, Sobey's abandoned a two-year $90 million investment in an ERP (Enterprise Resource Planning) system because of failed project management. Store shelves went unstocked for weeks at several stores and it set the company back $90 million.

In 2005, Sobeys lost a bidding war with Quebec based Metro to acquire A&P Canada, operator of several Ontario supermarket chains. The all-cash offer made by Sobeys was reportedly the highest bid for the chain but The Great Atlantic and Pacific Tea Company ultimately accepted Metro's $1.7 billion cash-and-stock offer. It is also suggested that the Sobey family was unwilling to cede any control to the Tengelmann Group, owners of the chain.[2] Though Sobeys remained the second largest grocery chain in Canada, it was the third place chain in most of the provinces outside the Atlantic, and the successful purchase of A&P Canada would have helped to bolster its position in Ontario.

In 2007, Sobeys announced a $260 million takeover offer for the Thrifty Foods chain in British Columbia.[3]

The company currently operates more than 1,300 stores in ten provinces and distributes goods to thousands of wholesale customers.

Ready to Serve initiative

Exterior of a typical Sobeys store, post-"Ready to serve"
Sobeys cash Area. New Brunswick

In 2002, Sobeys undertook major changes in its store design and customer service policies with the introduction of "Ready to serve". This initiative was reportedly an attempt to emulate the successful moves of the Publix supermarket chain in the southern United States [4]

It was highly stressed upon introduction that it was not simply a new slogan, but a new operating strategy focused on improved customer service. Loblaws, its largest competitor, has much larger stores and puts an emphasis on low prices. Sobeys decided to de-emphasize the price/size war in favour of a customer service upgrade.

The initiative introduced a series of changes intended to improve customer service. Employee uniforms, previously rather formal, were changed to more casual attire and wireless headsets and phones were introduced. Advertising and in-store signage were changed, and the Front-End Manager became the Customer Experience Manager. Employees are also trained to be more customer-oriented. Cashiers are required to greet, converse with, and assist customers. This can include packing their groceries for them. The same is required for employees in other departments as well.

At the same time the Ready to Serve initiative was implemented, the logo for the store was also changed. The four green circles were dropped and the logo simply consists of the Sobeys wordmark. The four green circles were however retained in the corporate logo of Sobeys Inc. The term Ready to Serve was added to the exterior of new and renovated stores.

In September 2006, Sobeys introduced a new slogan, a revamped website, and a new advertising campaign. The term Ready to Serve is no longer added to the exterior of new and renovated stores.

In 2008, Edmonton got a new urban-format Sobey's in its downtown core with street access and a unique building. Other Edmonton locations are being proposed (such as College Heights and Cloverdale), as well as locations in Calgary and Vancouver. These urban locations are catered to the crowd of the area, and sometimes have different types of food compared to suburban versions.[citation needed]

Exterior of a typical Sobeys store, pre-"Ready to serve"

Private label brands

The Sobeys private label lineup has carried several names. Initially it was known simply as Sobeys; by the mid-1990s it had been renamed Our Best. After its purchase of Oshawa Group, Sobeys dropped Our Best in favour of Oshawa's Our Compliments brand.

In 2005, Sobeys shortened the name to Compliments, dropping the "Our". At the same time, it expanded the brand's product lineup to make it more comparable to competing private labels such as Loblaw's President's Choice brand.

Compliments is currently divided into several sub-brands:

  • Compliments (by itself) is used to denote products comparable with national brands.
  • Premium-tier products are part of the Compliments Sensations label which was introduced in November 2005.
  • Compliments Balance is a line of health-conscious products which are evaluated by the Heart and Stroke Foundation, based on Canada's Food Guide, and bear the Health Check symbol.
  • Organic foods which are certified by Quality Assurance International are offered under the Compliments Organic label.
  • During the Christmas season, from November to early January, special products are sold under the Compliments Collection (previously Compliments Seasonal Collection) name.
  • In 2007, Compliments Junior, a line of Health Check-certified products aimed at children and co-branded with The Walt Disney Company, was introduced.
  • Compliments Green Care, a line of "eco-friendly" household products, was introduced in 2009.

In late 2009, lower-price store-brand products were transitioned from Compliments Value to the Signal brand, originally used by Sobeys in the 1990s for a similar range of products. After the Oshawa Group merger, Sobeys had switched to Oshawa's Smart Choice label, and later to Compliments Value.[5]

Private-label soft drinks are branded Big 8 in Atlantic Canada. Elsewhere, soft drinks bear the Compliments brand.

Company

Needs convenience/Sobeys Gas Bar

In addition to the flagship Sobeys banner, the company also operates supermarkets under a number of banners. After the purchase of Oshawa Group, Sobeys continued to use the existing banners for years, in order to maintain customer loyalty.[citation needed]

IGA and IGA Extra are the main brands in the province of Quebec. There are also 88 IGA stores in Western Canada and 105 in Ontario. However, Sobeys has announced that it plans to convert most of the remaining IGA stores in Ontario to the Price Chopper, Foodland, or Sobeys banners.[6] An IGA store is also located in mainly French-speaking Edmundston, New Brunswick; it is a rebranded Sobeys location. MarketPlace IGA stores in British Columbia are independently owned by H.Y. Louie,[7] parent of London Drugs, despite carrying Compliments products. Sobeys has reportedly made unsuccessful attempts to purchase the MarketPlace chain.[8]

At the time of the Sobeys takeover of the Oshawa Group, all IGA locations in Atlantic Canada were purchased separately by Loblaws for competition reasons. Loblaws converted these IGA locations to one of their own banners.

Sobeys operates the smaller discount grocery store Price Chopper which has 118 locations in nine provinces and the Northwest Territories. The company also operates the Foodland chain that is located mainly in rural areas of Newfoundland and Labrador, Nova Scotia, New Brunswick and Ontario. Other smaller grocery stores are operated under the Tradition Markets banner in Quebec and the Food Town banner in Western Canada. Sobeys also operates Thrifty Foods, a chain of 20 grocery stores based out of Victoria, British Columbia.

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Retired grocery banners

  • Commisso's Food Markets in Ontario were rebranded as Sobeys and Price Chopper.
  • Food City from the Oshawa Group in Ontario were mainly rebranded as Price Chopper.
  • Garden Market IGA stores in Western Canada were rebranded as Sobeys
  • Knechtel, a small-market grocery store chain under Oshawa Group, was rebranded as Foodland.
  • Lofood, a small discount grocery store, was rebranded as Price Chopper.

Other Sobeys-owned enterprises

The company owns the Needs, Sobeys Express, and BoniChoix convenience store chains as well as the Lawtons drug store chain in Atlantic Canada. Sobeys also owns the wholesale food distribution company TRA Atlantic. The company delivers products to retail outlets, such as convenience stores and gas stations, throughout Atlantic Canada. TRA also operates the Kwik-Way and Clover Farm convenience store chains.

At some Sobeys locations tobacco products are sold in a separate Sobeys-owned store, called Griffins. These outlets are a part of the Sobeys store but are only accessible from the outside due to provincial laws prohibiting stores with pharmacies from selling tobacco products.

A number of Sobeys and Needs stores in Nova Scotia and New Brunswick have a gas bar branded Sobeys Fast Fuels

Sobeys Express stores carry items commonly found in a convenience store but also include deli and bakery products, as well as produce. The first trial locations opened in early 2004 in Truro, Nova Scotia and Moncton, New Brunswick but the chain has since expanded into Ontario. The trial locations were converted Needs Convenience stores.

Loyalty programs

Club Sobeys and Air Miles cards

In Atlantic Canada and Quebec, Sobeys / IGA currently has a partnership with the Air Miles program. One reward mile is earned per $20 spent. Points may be redeemed for a variety of items including Sobeys gift certificates.

The Air Miles program is not available in the rest of Canada due to pre-existing relationships with Safeway in the west and Metro in Ontario. In these markets, the Club Sobeys program is offered instead. One point is earned for each dollar spent. Points may be redeemed for either grocery discounts or Aeroplan miles (at the rate of one mile per two Club Sobeys points). In 2009, the program was expanded into the Thrifty Foods chain as Club Thrifty Foods, with cards that can be used interchangeably between Sobeys and Thrifty Foods stores.

The Club Sobeys name was previously used for a similar loyalty program offered at the chain's Atlantic Canada locations during the 1990s, prior to securing the regional rights to Air Miles through the Oshawa Group merger.

In the Club Sobeys region, Sobeys has also introduced, in partnership with Citibank Canada, a Club Sobeys MasterCard credit card under the "Compliments Everyday Banking" banner. This may be a precursor to other banking products similar to the Loblaw / CIBC venture President's Choice Financial.

Locations

Alberta

70 locations:

British Columbia

3 locations:

Manitoba

16 locations:

New Brunswick

22 locations:

Newfoundland and Labrador

14 locations:

Nova Scotia

41 locations:

Ontario

98 locations:

Prince Edward Island

5 locations:

Saskatchewan

12 locations:

Empire Company

The Sobeys conglomerate is owned by Empire Company Limited, which is controlled by the Sobey family. In addition to Sobeys, the Empire Company also owns Empire Theatres, Canada's second-largest movie theatre chain, as well as many commercial retail properties through subsidiary Crombie REIT.

References

  1. ^ a b "2009 Annual Report". Empire Company Limited. http://www.sobeyscorporate.com/App_Themes/SobeysCorporate/media/en/Empire_AR_09_ENG.pdf. Retrieved 2008-12-15. 
  2. ^ Two CEOs dined, one got Apple Pie, Konrad Yakabuski, The Globe and Mail, July 23, 2005. Accessed March 25, 2007.
  3. ^ Sobeys buys Thrifty, gains foothold in BC, Marina Strauss, The Globe and Mail, July 16, 2007.
  4. ^ Grocery business faces sea change, Gordon Pitts, The Globe and Mail, July 20, 2005. Accessed March 12, 2007.
  5. ^ Jon Springer, "Sobeys Expands Premium Label", Supermarket News, 21 September 2009
  6. ^ Sobeys to convert IGA stores to Sobeys brands, CBC News, August 28, 2006.
  7. ^ H.Y. Louie Co. Limited to join IGA International, IGA Press Release, February 10, 2005.
  8. ^ Sobeys buys Thrifty, gains foothold in B.C., Marina Strauss, The Globe and Mail, July 17, 2007

See also

External links


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