CCGD shuts down; biggest members sign up with Retail Council of Canada

The association representing the country’s largest grocery chains is closing its doors. The Canadian Council of Grocery Distributors (CCGD) dissolved Friday after Loblaw Companies pulled out of the association.

Loblaw and the four other biggest members of CCGD–Sobeys, Walmart Canada, Metro and Canada Safeway–have agreed to join a new “Food Caucus” being formed by the Retail Council of Canada.

Nick Jennery, president of CCGD (pictured above), told Canadian Grocer that the association officially dissolved Feb. 4, but that its office in Toronto will remain open this month to wrap up operations.

This year’s National Conference, originally scheduled for Ottawa at the end of May, won’t be held, but Jennery said the Grand Prix New Product Awards will go ahead.

Rumours of Loblaw’s departure from CCGD had swirled for months. Though there were thoughts of CCGD continuing without the largest food retailer in the country aboard, the association’s directors voted to dissolve it at a Jan. 25 meeting.

Loblaw did not respond to Canadian Grocer’s request for an interview.

But with the dissolution of CCGD, Loblaw, Sobeys, Walmart Canada, Metro and Safeway have all agreed to support the establishment of a Food Caucus within Retail Council of Canada.

The Food Caucus (the name is temporary until a formal one is established) will focus on identifying and dealing with strategic issues affecting the grocery sector, domestically and globally, around several pillars: food safety; sustainability; industry supply-chain efficiencies and innovation; health and wellness; and emerging issues.

Diane Brisebois, president of the Retail Council, says her management team is working with the five grocers to develop a governance framework for the Food Caucus. She added that the Food Caucus will include the “active participation” of the grocery chains’ CEOs–something that didn’t always occur at CCGD.

The Retail Council “believes that through a closer collaboration between the grocery, general merchandise and drug retail sectors, the industry will be more successful in advancing and protecting the interests of the entire retail industry resulting in a strong, uniform voice,” Brisebois told Canadian Grocer.

She also pledged to work with other industry groups to advance the cause of the grocery industry.

The Retail Council of Canada represents some 45,000 stores in all sectors of retail. It is known for its lobbying efforts on behalf of the retail industry. “[We take] an unapologetic retail-first position on public policy affecting the trade. And this is exactly what we intend to provide to the Food Caucus and the grocery retail sector in Canada,” Brisebois said.

CCGD employed 16 people. Most will lose their jobs, but a handful have been offered positions with the Retail Council of Canada. Among those who have agreed to join Retail Council so far are: Jackie Crichton in Ottawa, Allen Langdon in Vancouver, Frédéric Alberro in Quebec and David Wilkes in Toronto. Retail Council is also taking on CCGD’s office in Montreal and will move the Vancouver office to a larger location.

It remains to be seen, however, how many other now ex-CCGD members, mostly mid-sized retailers, co-ops and foodservice distributors–will also join the caucus. It’s believed that several of the foodservice distributors are considering creating their own association and others are weighing their options.

Saskatoon-based Federated Co-operatives, for instance, hasn’t decided yet whether to join Retail Council or go to another association, says its vice-president of consumer products, Brad Bauml, who was a director at CCGD. “We’re doing our due diligence and trying to figure that out,” he says.

Frank Coleman, president of Colemans Food Centre in Newfoundland and fellow CCGD director, says his company has long belonged to the Canadian Federation of Independent Grocers (CFIG) and plans to focus its association activities on CFIG.

Coleman says while Colemans was a smaller distributor within CCGD, within CFIG it is considered a big distributor, along with companies such as Overwaitea and Longo’s.

He added there’s a possibility of forming a distributor group within CFIG. “I think our interest will be well represented going forward,” he says, referring to his company’s membership in CFIG.

Reflecting back on the benefits of CCGD membership, Coleman says the CCGD provided a window on initiatives the big distributors face from a policy point of view.

John Harvie, CEO of Moncton, N.B.-based Co-op Atlantic, says his company has not made a decision on which association to join. “We are rather disappointed to lose the regional services of the CCGD,” he says, referring to its Halifax office.

Harvie added that on a national scale, “We’ve lost something here. CCGD was the national voice of the grocery industry in Canada. Time will tell if we’re able to create a voice that can claim to be the voice of the Canadian grocery industry.”

Yet this won’t be the first time the Canadian grocery industry’s organization representing large chains has undergone a transformation, or been run through the Retail Council of Canada.

Up until the 1980s, Retail Council of Canada actually had a food division. Then in 1987, it and another industry organization, the Canadian Grocery Distributors Institute (CGDI), which represented a mish-mash of wholesalers, retailers, manufacturers and brokers, concluded that the two associations’ roles in grocery overlapped.

They agreed to form a new food-focused association, which became CCGD. Ironically, it was a Loblaw executive, Dave Stewart, who became the driving force to create CCGD. (Both CCGD and the former CGDI were successor organizations to the Canadian Wholesale Grocers Association, which was founded in 1919. It became CGDI in 1962.)

Jennery says his association played an important role in the grocery industry. In particular, he cites its efforts in creating food safety manuals, supply chain best practices such as the Unsaleables Protocol and, more recently, standards for Retail Ready Packaging. “I’m really proud of everything our staff have done. They’ve created a wonderful legacy for the industry.”

Harvie, a CCGD director, says now that CCGD is closing, “it behooves all of us to sort through this situation as best we can and remain responsive to the marketplace.” It’s unfortunate that CCGD is gone, but he adds that “usually these things happen for a reason.”

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