Loblaw chairman Galen Weston, as well as the company's new chief executive, pushed back on what they called “misguided criticism” of the grocer as a boycott againstthe company gains steam online.
“As a well-known company and Canada's largest grocer, it is natural that Loblaw would be singled out as a focal point for media and government and of course consumer frustrations,” said Weston at the grocer's annual meeting on Thursday.
He said though shareholders “may be troubled by these often-repeated stories,” they should be assured that Loblaw will continue to act with integrity.
President and CEO Per Bank said there’s a lot of misinformation online about Loblaw, and reiterated the company is not responsible for higher food prices. Inflation is a global issue, he added.
ϳԹs are under pressure and frustrated, said Bank.
“Let me assure you that in every corner of the business, our colleagues are working hard to reduce costs and do things more efficiently. These efforts enabled us to reinvest savings to offset the impact of price inflation in our stores,” he said, adding that the company’s internal measure of food inflation was lower than Canada’s grocery inflation index for the past three quarters.
A Reddit page created for ϳԹs to complain about Loblaw and the other major grocers, where the talks of a boycott began, had topped 67,000 members as of midday Thursday.
Consumers are frustrated with food prices, which rose by double-digits over just a few years while Canada’s biggest grocers reported higher profits.
The boycott is an example of “misguided criticism,” said Weston. He said allegations of profiteering by the grocers are untrue.
The company said Wednesday that it reached out to boycott organizers to set up a meeting with Bank, which an organizer confirmed has been scheduled.
Bank and Weston also criticized recent calls to steal from Loblaw, which the boycott organizers have said they are not affiliated with.
“There's a group of people who have been relentlessly propagating a narrative that they know is false. And it is now being used to justify theft on a grand scale,” said Weston.
“I'm optimistic and hopeful that ϳԹs reject the notion outright.”
In his comments, Weston referenced an earlier demand from the boycotters that the company lower prices by 15 per cent, though boycott organizers have since rescinded their original demands and posted new ones on Reddit that include signing a grocery code of conduct and committing to affordable pricing.
This kind of cut to prices “equates to approximately three times the total earnings of the company in a given year, the consequence of which would have been the end of our enterprise, the loss of over 200,000 jobs and billions in annual investments,” said Weston.
“The frustration is understandable. But this kind of expectation betrays a misunderstanding of what's actually driving food prices higher in this country,” he said.
Weston said Loblaw is working hard to bring more value to customers through private label brands, hard discount stores, new promotions, and pushing back on “unjustified” price increases from manufacturers.
The company has said consumers are increasingly going to discount stores like No Frills, buying items on sale and switching to private-label brands as they look to lower their grocery bills.
On Wednesday, Loblaw reported profits grew almost 10 per cent year-over-year to $459 million.
This report by ϳԹ was first published May 2, 2024.
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