The Encyclopedia of Saskatchewan

 

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Food Retailing and Wholesaling

Food retailing and wholesaling is an important sector in the Saskatchewan economy. Saskatchewan consumers spend about 10.7% of their disposable income on grocery (food, non-food, and alcoholic beverages) items; this generates $2 billion in sales annually. There are over 1,100 retail stores in Saskatchewan, employing 13,500 people. The food retailing industry in Canada is dominated by a small number of large firms. Market shares for food retailers in Manitoba/Saskatchewan in September 2003 were: Westfair (a subsidiary of Loblaw Companies Ltd.; stores include Extra Foods and Superstore)—27.8%; Canada Safeway (a subsidiary of Safeway Inc.)—20.3%; Federated Co-operatives Ltd—16.2%; Wal-Mart—8.7%; others (including IGA and Garden Market IGA and also independent retail stores–28%. The market shares change continually as firms merge, existing firms decline, and new competitors emerge. Wal-Mart has been rapidly increasing its market share in Canada.

The large grocery retailers carry a diverse array of food and household products; on average, these grocery stores carry 24,000 different items. Most of them operate their own wholesaling divisions, and own wholesale distribution depots throughout western Canada. There are also a number of small, independent food retail stores. While some of these are general grocery retailers carrying a range of food items, many more specialize in the retailing of meat, fish or other fresh items. Organic foods, although still a small component of total food demand, are growing rapidly: there are several small specialized organic food stores, and the major retail stores are carrying an increasing number of organic food items.

Food retailing has developed into a high-technology business. The major food grocery chains utilize barcoding and scanner technology as an integral part of their supply chain management practices. The barcodes attached to individual items are read by electronic scanners at the checkout, and enable the company to manage its inventory more accurately. As items are sold, new items can be ordered automatically from the company’s distribution centres; advertising and promotion can be based on this information. Retailers are responsible for ensuring that food products are labelled appropriately: in January 2003, the Canadian government passed a new law requiring mandatory nutrition labeling for food products. The retailing sector participates in industry consultations with the federal government on food labeling regulations and food standards through the Canadian Council of Grocery Distributors (CCGD). CCGD members account for over 80% of grocery distribution in Canada.

Jill E. Hobbs

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This web site was produced with financial assistance
provided by Western Economic Diversification Canada and the Government of Saskatchewan.
University of Regina Government of Canada Government of Saskatchewan Canadian Plains Research Center
Ce site Web a été conçu grâce à l'aide financière de
Diversification de l'économie de l'Ouest Canada et le gouvernement de la Saskatchewan.