Canadian Retail Thread

[miketoronto]

The Hudson's Bay Company has opened one of the worlds largest ladies shoes departments at their Queen Street store in Toronto.

The ladies shoe department is second largest in North America, challenged by only Macy's in Manhattan.

In the world, the only other department stores with larger ladies shoe departments are Selfridges in London, and Galleries Lafayette in Paris.

The Hudson's Bay Queen Street store is the second largest department store in North America, after Macy's in Manhattan. The store has 1 million sq feet.

[Boris2k7]

Sobeys to buy Canada Safeway for $5.8 billion in blockbuster deal

TORONTO — Supermarket chain operator Empire Co. Ltd. is buying the Canadian assets of grocer Safeway for $5.8 billion.

The Nova Scotia-based parent of the Sobeys chain said Wednesday that the cash deal will boost its presence in Western Canada and give it $1.8 billion of real estate.

The transaction to buy Canada Safeway Ltd., which has 213 stores, will be completed through its wholly-owned Sobeys Inc. subsidiary. Included in the transaction are 199 in-store pharmacies and 62 gas stations on the Safeway properties.

...

Read more: http://www.calgaryherald.com/business/So...er+deal/8516440/story.html#ixzz2W2gFftrv

[SpongeG]

boo don't mess with my safeway

[MonctonRad]

Originally Posted by SpongeG

boo don't mess with my safeway

I wonder if they will rebrand them as Sobeys.

I think there will ultimately be only two Canadian survivors in the Canadian grocery wars - Loblaws/Superstore and Sobeys. Their competition will be Walmart Supercentres, Costco and Target.

[SignalHillHiker]

Coleman's is going to survive here. People are far too nationalist to let our own go under.

Beyond that... I can definitely see CostCo wiping out the rest. If Walmart builds a proper grocery here, it'll do very well among the same suburban families as well.

Downtown will always be small places like Water Street Variety (which brings in its fresh and baked goods from Bidgood's Grocery, another local favourite based in Goulds), Belbin's Grocery, etc. In every way, downtown residents prefer one-off local shops to chains. We don't even have a McD's downtown.

The edges of downtown have a regular Sobeys and a massive Dominion (in the former Memorial Stadium). Both are well-used by the surrounding neighbourhoods so I don't think we'll see them close down. That said, there is a Coleman's that's very close to the Sobey's - so Sobey's may want to back out of the downtown a little farther. We'll see.

There's one other 24-hour Dominion (on Blackmarsh) that's relatively close to downtown. It's always packed. I don't think it'll go anywhere.

I'm sure I'm forgetting a bunch.

*****

Sad thing is Safeway is famous for treating its employees exceptionally well. It has a near CostCo-level reputation. I'm sure that's all going downhill now...

Also, their chicken pesto deli sandwiches... OMG... their delis offer a fraction of what Sobey's does, but it's all awesome.

[Acajack]

Originally Posted by MonctonRad

I wonder if they will rebrand them as Sobeys.

.

They might keep the name. Sobeys in Quebec is IGA.

[memememe76]

I always buy my french bread at Safeway. Will those be gone?

[isaidso]

Originally Posted by SpongeG

boo don't mess with my safeway

Canadian ownership of the domestic grocery industry just jumped significantly though. Safeway Canada is a foreign company and is being taken out by a Canadian company. That's good news for corporate Canada and our economy.

[isaidso]

Originally Posted by Acajack

They might keep the name. Sobeys in Quebec is IGA.

Still? I thought they would phase that name out over time just like Steinberg and Provigo were.

[artvandelay]

Damn, this is a shame. Safeway is the only place I shop.

I don't really think Sobey's gains any significant value out of this deal unless they are allowed to retain the Safeway brand in Canada. If they decide to re-brand them all under the Sobey's banner, this deal becomes more of a play to take out the competition and not worth the massive premium they paid. Sobey's probably has the least recognition of the major grocery chains out here, I'd bet that many shoppers would switch to the more familiar Co-op or Save-on-foods.

[isaidso]

Originally Posted by artvandelay

Damn, this is a shame. Safeway is the only place I shop.

I don't really think Sobey's gains any significant value out of this deal unless they are allowed to retain the Safeway brand in Canada. If they decide to re-brand them all under the Sobey's banner, this deal becomes more of a play to take out the competition and not worth the massive premium they paid. Sobey's probably has the least recognition of the major grocery chains out here, I'd bet that many shoppers would switch to the more familiar Co-op or Save-on-foods.

Sobeys needed to bulk up so they could better compete with Loblaws and Walmart. This deal brings increased economies of scale and more financial clout. Before Sobeys was a distant #2; with Safeway Canada they're a strong #2 with $24 billion in sales.

Canada now has 2 big national players with the size needed to prosper. Metro has become the weak 3rd placed firm. They might have to counter and take out Overwaitea. Perhaps Sobeys will eventually take out Metro as well and we'll be left with 3 dominant chains: Sobeys, Loblaws, and Walmart.

[artvandelay]

It's also funny how attached people are to Safeway. I haven't talked to anyone who has been happy about this.

[artvandelay]

Originally Posted by isaidso

Sobeys needed to bulk up to be better able to compete with Loblaws and Walmart. Without the economies of scale and financial clout this deal brings, they'd be in a weaker position. They're now a strong #2 with $24 billion is sales.

Canada now has 2 big national players with the size to prosper. Metro has now become the weak 3rd placed firm. They might have to counter and take out Overwaitea.

Oh I agree it's a good deal for them, but it really only makes sense if they keep the Safeway brand (in the west at least).

[isaidso]

Originally Posted by artvandelay

Oh I agree it's a good deal for them, but it really only makes sense if they keep the Safeway brand (in the west at least).

Why? Things get re-branded all the time. Zellers became Target, Eaton's stores were rebranded Sears, Gulf and Texaco became Petro Canada, etc. I highly doubt Sobeys wants to promote the brand of a global rival, nor would Safeway likely want a rival using their brand.

Btw, the west is the only place were Safeway has stores. They're not existent east of Thunder Bay.

[Allan83]

Originally Posted by MonctonRad

I wonder if they will rebrand them as Sobeys.

I think there will ultimately be only two Canadian survivors in the Canadian grocery wars - Loblaws/Superstore and Sobeys. Their competition will be Walmart Supercentres, Costco and Target.

In western Canada if there were only going to be two survivors it would be the Coop (Federated Co-operatives Limited) and Safeway/Sobeys, but I think Loblaws has carved out enough of a niche to survive. And I’m sure there will always be Wal-Marts and Costcos, and chains like Sunterra on the high end side. The Coops have a long history here and people are loyal to them for reasons other than just the fact that they're generally good grocery stores.

[Allan83]

Originally Posted by artvandelay

Oh I agree it's a good deal for them, but it really only makes sense if they keep the Safeway brand (in the west at least).

I agree. Safeway is a very strong brand in the west, and Sobeys still is very new and relatively unknown here. It wouldn't entirely surprise me if the Sobeys name was the one that disappeared in the west.

[artvandelay]

Originally Posted by isaidso

Why? Things get re-branded all the time. Zellers became Target, Eaton's stores were rebranded Sears, Gulf and Texaco became Petro Canada, etc.

Btw, the west is the only place were Safeway has stores. They're not existent east of Thunder Bay.

I don't think you understand. Sobey's is already here. For example - in my neighbourhood I have a Safeway, Co-op, and Sobey's. My order of preference for these is Safeway>Co-op>Sobey's. If they integrate their back of house operations but keep the in-store experience the same, it's likely that I keep shopping at Safeway. If I only have Sobeys and Co-op to choose from, it's likely I go to Co-op.

Safeway has a massive amount of brand loyalty in the west, they've been here since the 1930s while Sobeys has virtually none. It wouldn't make sense for them to rebrand everything under the weaker brand.

Originally Posted by isaidso

I highly doubt Sobeys wants to promote the brand of a global rival, nor would Safeway likely want a rival using their brand.

Unless Sobey's is planning on expanding to the States, there wouldn't be any problem. Things like this happen all the time, for example A&W is completely different in the US and Canada, and Safeway itself had a division in the UK that was owned and operated independently.

[davidivivid]

Originally Posted by isaidso

Still? I thought they would phase that name out over time just like Steinberg and Provigo were.

Steinberg was phased out but the Provigo brand still is very much alive, even if its reputation has been butchered by executives in Ontario who, after the purchase of Provigo by Loblaws, expected the Quebec market to behave similarly to that of Ontario's. Provigo was in a strong first position at the time and it has become a distant 3rd or 4th with half the stores it used to have.

Anyway, Loblaws still isn't a strong brand in Quebec, reason why they are investing $100M to change some of their Loblaws stores to new Provigo Le Marché concept stores.

[SignalHillHiker]

There were still IGAs in rural areas of Newfoundland as well, last I checked. But usually prefaced by a family name, like Farrell's IGA in Marystown. So I don't know if that's even the same thing. There's also Foodland in a lot of rural areas. Dominion dominates outside the city, though, in my experience.

[kwoldtimer]

Originally Posted by isaidso

Still? I thought they would phase that name out over time just like Steinberg and Provigo were.

When Loblaw's bought Zehrs, they not only retained the name but I think opened additional supermarkets in central southwestern Ontario under the Zehrs name. On the other hand, when Sobeys took over the old Dutch Boy supermarkets in Kitchener, they eventually rebranded them as Sobeys. That was a bit of a risk as the common perception at the time was that K-W shoppers would not patronize a grocery that was not "local" (there was a long history of national chains trying unsuccessfully to penetrate the local market). It seems that perception was not entirely accurate, as the Sobey's continue to operate here (although Zehrs dominates the local market, it seems to me).

In the case of Safeway, I wonder Sobeys won't be obliged to change the name, given the Safeway name in the States? I guess it will depend on what they negotiated in the purchase. Where both Sobey's and Safeway already exist, I suppose stores could be rebranded with some of Sobeys other company banners.