Old meets new as Calgary Co-op transforms from its rural roots into a grocer with global flavours, more local food and health as its centrepoint. Canadian Grocer spoke with the retailer’s CEO, Deane Collinson, about a new store design, strategy and big-payout membership card.
Can you tell me about your recently renovated store in Calgary’s Crowfood area?
Crowfoot is 72,000 square feet and features a substantially different layout than our previous stores. Before opening this store, the team did a lot of market research into fresh food specialists such as Wegmans and Whole Foods.
The produce area is the most noticeable thing when you walk in. We moved all the fresh to a large hall. And the pharmacy has been moved to a prominent position in the front, with grocery next to it.
The Crowfoot store also has our full-scale offering, which includes our chef-created meals in our new Fresh-to-Go department. This store is an anchor store for Calgary Co-op and will be the measure of excellence for our food stores moving forward.
Besides fresh, what other area is the store focused on?
We want to be viewed as very strong in the health business. Whole health is one of our pillars. At the secondary entrance at this store, there’s a pharmacy and two private consultation rooms for our pharmacists.
There’s also an expanded pharmacy at Crowfoot that offers services such as prescription compounding and free prescription delivery.
Within the competitive grocery landscape, what will be key to success for your company?
It’s important to make sure that whether you’re a discounter or conventional grocer, your value proposition has to be very strong. For us, we want to be food experts. So we want to offer exclusive products as well as competitive pricing.
For example, we want to be competitive on regular eggs, as well as on other types of eggs that people are willing to pay a premium for. It’s the same with beef: we sell one type of beef that is Triple-A dry-aged for 28 days, [plus] regular beef, like everyone else, and [we’re] super-competitive [on pricing] on that.
Speaking of competitors, with all the consolidation in the sector, how does a small co-op manage?
Our size enables us to listen to what our market wants and respond to it quickly. With the big focus right now on buying local, as a co-operative, [we offer] a lot of authenticity: We buy local and can prove it.
We’ve partnered with the Alberta program Localize, for example, which measures and scores all of our local products–1,000 local products so far–based on distance and ownership of company. Shoppers will recognize the bright orange Localize labels in our store.
Our Co-op Perfect Pork features fresh open-pen raised Alberta pork. This product would be virtually impossible for big guys to source and [sell]. We think animal welfare will be a huge issue going forward, so much so that over the next five years we will phase out eggs and pork products from farm operations that use intensive confinement cages.
Can you describe how the customer has changed for Calgary co-op and how you’re meeting their needs?
Typically, in the past, the co-op shop-per was older and came from a rural area. But now we’re seeing younger shoppers, customers with families, new Canadians and immigrants. Our revamped store will be more relevant to these groups. Some of the things we’re doing that is resonating with these families include providing more convenient meals to go as well as more international food offers.
There’s also our World Foods section. Crowfoot is the first store where we’ve really done the full integration. This is a whole new area for us, and it’s not just about providing the needs for specific communities eating those [ethnic] foods. We’re finding everybody in general is cooking more Indian and Asian.
The world foods are also reflected throughout the store. For example, we have halal meat in the meat department; as well as unique seafood offerings; a self-serve curry bar in the food-to-go area; and ethnic produce in fresh.
You’ve also brought in a restaurant chef.
Yes, we hired a former executive chef of Moxie’s who created all the food for our Fresh-to-Go department. We have a different meal featured every day during the week, for $10, at the Macleod Trail and Crowfoot locations. You can get a full rack of ribs with two sides, or full chicken with four sides, all for $10.
Every night there are lineups for these meals. We think eventually the Fresh-to-Go meals could account for as much as 15% of our total store sales.
You’ve also expanded the organic and gluten-free offerings. what’s the reasoning behind that?
The organic and gluten-free offers really appeal to our families. We do more than 30% of organic sales in Calgary. On the meat side, we offer antibiotic-, growth hormone-free beef and pork; organic meat; and preservative-free, gluten-free deli meat. It’s in line with our whole-health focus.
We offer more than 600 gluten-free items. A shopper was in the area recently [who wasn’t a Co-op shopper], and [she] was amazed to see all the gluten-free products we carried compared to our competitors. We are also the first-to-market grocery retailer to run a gluten awareness program in our pharmacy.
Can you tell me about your membership card?
Calgary Co-op members are member-owners and use their membership card to track their annual spend, which ensures they take advantage of the annual member refund.
To ensure we meet the needs of our members, we complete an annual customer service survey, which reaches approximately 12,000 people. It ensures we understand what they like, what they don’t like and what types of products and services they are looking for.
As a co-operative, we don’t make a profit–the profits go back to members. Last year we gave back more than $30 million to our members, and $4 million to our local community.
Under our model it can be easy for an average-sized family that buys their gas, pharmacy, travel, wines and spirits and groceries at Co-op to get over $1,000 back at the end of the year. Plus, when you purchase your gas at Co-op you receive three cents [per litre] back at the pump in coupons that can be redeemed at our food stores.
I would add that, especially among young people, we’re seeing a lot of distrust for “big business” and they see the co-operative model as an alternative that supports local suppliers and that is transparent. If you ask anyone in Calgary, ‘What’s your Co-op number?’ they can tell you.