Q: When you look at where grocery is at right now, what are the big challenges we face as an industry?
In Canada we have two things happening. We have large, multinational merchants coming into every corner of the country. And we have existing mass merchants saying to themselves, “How are we going to offset these new retailers?” One of their answers is to move into grocery. Canadian Tire is moving into grocery. Drugstores are moving into grocery. Everybody is trying to grab grocery as a traffic builder. So for us, the dedicated food retailers, the challenge is to stay relevant, innovative and not boring and to appeal even more to consumers.
Q: You mentioned not being boring. Are you thinking of what you’re doing in your own stores to create excitement, like having musicians perform in the aisles?
Absolutely. We’re trying to create excitement with those kinds of events. We’ve tried to build strong relationships with the arts and music community, who are looking for a place to get discovered–and what better place than in our food stores. We’ve also done bridal nights, multicultural nights and we do cooking classes as well. It takes a big effort on our part to stay relevant and energized.
Q: Colemans especially does a lot of community work, from organizing bike rodeos to your Kids Eat Healthy program. Is there a business case for these things?
We are heavily involved in the community in arts and charity, yes. But I will tell you that our market research has never shown that being community-minded has ever mattered to the consumer. Yet what we’ve discovered over a longer period is that getting involved fortifies your brand. It affects how you are perceived in the communities you operate. You still have to be competitive, you still have to provide great products and great value but it does have an impact. Now, those aren’t the reasons we get involved in our community. We do it because we’re here and we want to participate in our towns and we also find people enjoy working with us on special causes. It also boosts staff morale, which is, of course, a huge factor.
Q: What’s the smartest thing you ever did in your business?
I’d like to answer that in two parts. The first is a moment about eight years ago when we decided to start managing our business in real time, not on a time frame coincidental with a set of financial statements. We built computer systems to do daily reporting and auto replenishment and such. We got very granular and along with that we built a reward and accountability culture. The second smart decision came when we truly internalized the belief that we had to abandon every old idea we had of what we stood for. We had to throw all that thinking out.
Q: How did you define yourself and how did that change things?
One would be the notion that we have the lowest price imaginable and we’ll do everything we can to be there. Those are old games that were fine in their day. But when you have mass merchants coming in to undercut you, where do you then sit? You have to move into a space where you know you’re going to fit and where you’re going to offer a value proposition to your consumer that matters and that they trust. Once we said we want to improve the infrastructure of our stores, we want to improve the execution and everything we do and provide new services, and then we added in that new accountability system, that really drove us to the next level. Things really took off from there.
Q: What’s the future of the independent grocer in Canada?
I’m going to give you an unusual answer to that question: Independents remind me of piranhas. Piranhas are important creatures ecologically to their environment. They’re a scavenger and they’re a predator. For their size, they are vicious competitors. Occasionally they hunt in packs. I would say the survival of the independent grocer is just as assured as the survival of piranhas. As independents we just need to focus on when and where we hunt, when we scavenge and when we take a chunk out of the fatter and slower cows that come swimming in our river.
Q: Will online grocery shopping take off?
I don’t know. There will be elements of customers who will go online for groceries, like moms and dads who are busy and want to get their groceries delivered to their house. But I do believe that people want to get out of their house and have that tactile experience of picking out their produce, for example, and retailers are putting more excitement into their stores for the consumer. When you look at Pete’s [Frootique in Nova Scotia], Longo’s and Pusateri’s [in Toronto] or our new store in Corner Brook, these are exciting, interesting experiences. You know when you come to our store on a Friday you get a musical experience, too. That will keep attracting customers. We’re seeing other tactics as well. For instance, liquor stores are getting situated closer to food stores so when people get wine, they also stop into the grocer to pick out some nice cheese.
Q: Are there any stores in particular, here in Canada or abroad, that you admire?
I’ve always been intrigued by Dorothy Lane Markets in Ohio. [CEO] Norman Mayne has done an incredible job there. And Pete’s [Frootique] is a very interesting and evolving format. When I’m in Toronto I like to drop by Pusateri’s. I also enjoy going to open markets. When I was in Spain I spent a lot of time in open markets, looking at different concepts of merchandising and how they survive with their small stands, how they sell and the energy they bring to it all.
Q: The grocery industry has changed a lot over the last 20 years. Is it better or worse?
Oh, it’s certainly better. There is a bigger focus on healthy eating, on the value of produce, the value of nutrition, specialty foods like gluten-free, salt-free and sugar-free. Organics has been a positive change and labelling is better. I think the consumer is very happy with the way things have changed. The diversity of food available today is remarkable. I have five daughters and the stuff they bring to my home in the way of food, I don’t even know what to do with it–and they buy it at our stores. Manufacturers and retailers have done an amazing job responding to the consumer’s desire for healthier and nutritious products. I’m really pleased where it’s going.