Winnipeg Retail

[vjose32]

I saw an image of St James Station on the Shindico site and it would seem there is a bit of room for expansion to the north side.

[buzzg]

Originally Posted by vjose32

I saw an image of St James Station on the Shindico site and it would seem there is a bit of room for expansion to the north side.

That's where St. Matthews is supposed to go.

[cllew]

As far as I am aware the land behind St. James station shopping mall is the old CN rail Oak Point right of way, and it is now owned by Manitoba Hydro who is going to be using it for an underground 115KV right of way to connect the old St. James substation to a new terminal station on Madison and Ellice.

Most of it has been leased for parking to the mall owner (Shindico)

[SpongeG]

Originally Posted by esquire

What/where is that?

EDIT: nevermind, found it: http://www.shindico.com/email/images...n_brochure.pdf

Interesting... but other than Canadian Tire, those spaces aren't very big. Is it fair to say that Save On will likely have the smallest stores out of the major grocers in Winnipeg? I recall from my years in Edmonton that Save On locations were very comparable to Safeway and Sobeys locations... seems that they're going smaller here.

On a related note, I wonder if Save On is the chain that the SkyCity Winnipeg gang has been in conversations with? If they're going that small with their stores, it seems like a decent fit, in the event that SkyCity were to actually get built.

save-on's new stores in the vancouver area are a lot smaller than they were in the 90's, smaller than a typical safeway, they used to have huge stores comparable to RCSS but they seem to like the smaller format now, i always liked shopping at save on but they could be expensive, you really need the card to get the deals/savings

the save on near my old place in coquitlam/burnaby started out as price smart and than changed to save on, it wasn't that big compared to the nearby extra foods and safeway but had everything one could need

[vjose32]

I believe the Free Press says they said the prices would be comparable to Superstore. Also it seems the Northgate store will be bigger to accommodate more international foods because of the neighbourhood has many ethnicities.

As for the earlier comments regarding the St James location, I did say North, as in towards the hockey store, just at the back end. As it is there is a strip at the northwest corner of the store is missing, according to the picture I saw. This is nowhere near where St Matthews is going.

If you google St James Station you'll find a link to a pdf on the Shindico site with a site plan as is. Now that I see it better I think it would be a safe bet that they remove Subway and expand to the north side like I mentioned.

[buzzg]

Originally Posted by vjose32

As for the earlier comments regarding the St James location, I did say North, as in towards the hockey store, just at the back end. As it is there is a strip at the northwest corner of the store is missing, according to the picture I saw. This is nowhere near where St Matthews is going.

If you google St James Station you'll find a link to a pdf on the Shindico site with a site plan as is. Now that I see it better I think it would be a safe bet that they remove Subway and expand to the north side like I mentioned.

Well you were talking about the site and said north, north of the hockey store is EXACTLY where St. Matthews is going, it's even on this Shindico PDF, even though it's not built yet. But that strip of "missing" space and the northern part of Future Shop is the loading dock, so that won't be going anywhere.

[vjose32]

I think you misunderstood. I don't think I ever said north of Hockey Life, I said to the north, next to that store, but I didn't mean on the St Matthews side, clearly that is not where Future Shop is. If they take over the Subway they will have a bit more room.

[CoryB]

I honestly don't think trying to compete with Superstore on prices is going to be a smart strategy for Save on Foods. What is going to happen is they will erode any margins they can make while Superstore and Walmart underwrite losses in the Winnipeg market with profits from their operations elsewhere in Canada. Yes, in the short term consumers will win but how long with Save on Foods play this game before they run away like Target?

They would be far smarter to play up click and collect (buy your groceries online and pickup the order at the store) or even taking it a step further and bringing it directly to your home. Win people over on the superior customer service side of things and the quality of your products. Your private label brands will also be key and I don't think they are going to approach the level President's Choice has achieved.

Time will tell but this could be a case of who has the deepest pockets to underwrite losses on wins.

[armorand93]

Originally Posted by CoryB

I honestly don't think trying to compete with Superstore on prices is going to be a smart strategy for Save on Foods. What is going to happen is they will erode any margins they can make while Superstore and Walmart underwrite losses in the Winnipeg market with profits from their operations elsewhere in Canada. Yes, in the short term consumers will win but how long with Save on Foods play this game before they run away like Target?

They would be far smarter to play up click and collect (buy your groceries online and pickup the order at the store) or even taking it a step further and bringing it directly to your home. Win people over on the superior customer service side of things and the quality of your products. Your private label brands will also be key and I don't think they are going to approach the level President's Choice has achieved.

Time will tell but this could be a case of who has the deepest pockets to underwrite losses on wins.

The Waltons sure won't have a problem, paying for losses!

[steveosnyder]

Originally Posted by armorand93

The Waltons sure won't have a problem, paying for losses!

When they get to that much money I don't think it will ever really be an issue. I'm sure that the Weston family would be just fine too...

[h0twired]

Originally Posted by steveosnyder

When they get to that much money I don't think it will ever really be an issue. I'm sure that the Weston family would be just fine too...

The Weston family is pretty much neck and neck with Jim Pattison when it comes to net worth.

[steveosnyder]

Originally Posted by h0twired

The Weston family is pretty much neck and neck with Jim Pattison when it comes to net worth.

This is somewhat what I was trying to get at when I said "when they get to that much money I don't think it will ever really be an issue"... Once you've attained this size of business it's not about wealth any more... Save On won't be able to compete in Winnipeg with Walmart and Superstore because they are already entrenched brands in Winnipeg, so attempting to recreate their competitive advantage is a fool's errand, much like Target found out (and I would argue that Target has much bigger name recognition than Save On Foods).

As CoryB said, they would be better to distinguish themselves with other services like click and collect (whatever that is, I'm a bit ignorant). They won't be able to compete on price.

[horrorbro123]

Any World When Canadian Tire Construction Start On Former Target Location In Grant Park?

[CoryB]

Click and Collect is basically a hybrid of on-line and in-store shopping.

You basically do all the "shopping" part on the stores web site and then show up at the stores parcel pickup area where your cart full of groceries is waiting for you. It is likely a touch more complex than that as cooler and frozen product would need to be kept separate from dry goods in the holding area.

That said, if your box of cereal has a cost to every retail of $5, if Save on Foods decides to take a loss on that by selling if for $4.50 in Winnipeg, Walmart and Superstore could match that price. Walmart and Superstore then say charge an extra $0.10 for that same cereal in the rest of Canada and write off the loss, no money out of pocket. Save On Foods though has fewer established stores to spread that loss out over.

You could further compound the issue in that Walmart, Superstore and Sobey's are all ordering for a significantly larger number of stores. That means when they go to the cereal manufacturers and ask for a discounted price to run a promotion in Winnipeg they are more likely to get it than a smaller player like Save On Foods. So now instead of Walmart and Superstore having a $0.50 per box of cereal loss to absorb they say have a $0.30 loss and the manufacturer is taking a $0.20 hit. And guess what, that manufacturer needs to spread that loss out over all its customers, so yes, the smaller player, Save On Foods, indirectly is helping underwrite the loss leader at Walmart and Superstore.

Granted I don't work in that industry but if you have ever looked into order larger quantities of items it is easy to see these type of discounts. Add in Walmart is well known for driving every last penny out of prices from suppliers.

[rypinion]

I've done very close to what you call "click and collect" with Amazon and Walmart. They both had implemented Canada Post's "FlexDelivery" long before Canada Post started advertising it.

So, it's the same idea but you pick up from your local Canada Post, which for me is the Shoppers in Winnipeg Square - super convenient, free shipping, and same prices as buying in store.

[Simplicity]

Originally Posted by CoryB

Click and Collect is basically a hybrid of on-line and in-store shopping.

You basically do all the "shopping" part on the stores web site and then show up at the stores parcel pickup area where your cart full of groceries is waiting for you. It is likely a touch more complex than that as cooler and frozen product would need to be kept separate from dry goods in the holding area.

That said, if your box of cereal has a cost to every retail of $5, if Save on Foods decides to take a loss on that by selling if for $4.50 in Winnipeg, Walmart and Superstore could match that price. Walmart and Superstore then say charge an extra $0.10 for that same cereal in the rest of Canada and write off the loss, no money out of pocket. Save On Foods though has fewer established stores to spread that loss out over.

You could further compound the issue in that Walmart, Superstore and Sobey's are all ordering for a significantly larger number of stores. That means when they go to the cereal manufacturers and ask for a discounted price to run a promotion in Winnipeg they are more likely to get it than a smaller player like Save On Foods. So now instead of Walmart and Superstore having a $0.50 per box of cereal loss to absorb they say have a $0.30 loss and the manufacturer is taking a $0.20 hit. And guess what, that manufacturer needs to spread that loss out over all its customers, so yes, the smaller player, Save On Foods, indirectly is helping underwrite the loss leader at Walmart and Superstore.

Granted I don't work in that industry but if you have ever looked into order larger quantities of items it is easy to see these type of discounts. Add in Walmart is well known for driving every last penny out of prices from suppliers.

What are margins in the grocery business these days, 2-3%?

There's an old adage about the market being able to stay irrational longer than most can remain solvent. Nobody is going to be interested in a price war with those sorts of margins. I suspect Save-on-Foods will do what most low margin retailers do: sell a few items at a loss to get people in the store and then make them pay for a better experience.

[SpongeG]

save on foods in BC is usually pricey like safeway, i think they gave up trying to compete with superstore and walmart

i find the produce, deli, bakery and meat much better at save on, they have a lot of good hot food options too, their generic brand western family is usually quite a bit more than the no name products at superstore like over $2 for a bag of chips compared to $1.47 which is the price i usually see at superstore

[esquire]

^ When I lived by a Save-On in Edmonton, I never got the impression once that they were competing with Superstore. They were easily in the Sobeys/Safeway tier of full-service supermarkets, and charged accordingly.

Living on a meager student budget, I used to shop at Save-On for basics like milk and bread, and then I'd hop on the LRT to Superstore once a month to load up.

[vjose32]

According to the article in the times the Northgate location will have Asian foods, a wing and pizza bar, and an in-house perogy making machine. They will offer home delivery as well as click and collect.

Sounds like they know what they are doing.

[CoryB]

The Save On Foods launch event talked about how they were going to compete with Superstore on price. Considering the narrow margins and buying power of Superstore this seems like a poorly thought out idea. Add in that if you are trying to have the "lowest" prices Walmart will put you in their crosshairs and put an extreme amount of pressure on you.

You are much better of trying to compete against Superstore and Walmart on other aspects than trying to keep up with them on price. It also goes without saying that there will be grand opening specials that push the floor on prices to try and get people through the doors.