Saturday, 11 January 2014



Sobeys and the 1%


Yesterday I went for a haircut. After Paul had finished the job I told him that even though he charged $23 for a trim, I would only pay him $20. I also told him that I expected an additional $3 rebate on my previous haircut last November. Finally, I said that from hereon in I expected to pay $20 though I may arbitrarily drop that price too. Maybe down to $18, I wasn’t sure, but I was confident a precedent had been set and I pretty much had carte blanche to dictate the cost of his services and shave his margins for my benefit.


Our ensuing discussion was short as he’d left enough on top to grab a fistful of my hair and straight razors are really sharp.


That evening we went downtown to the Mercer Tavern to watch a little hockey and have a bite to eat. It was a nice time as we don’t treat ourselves frequently. When the bill came I told the waitress that even though the pints of Newcastle Brown were on special for $4, I would only pay $3.50. Then I told her I expected at least $2 off the menu prices for the burger and the Rueben sandwich. And don’t forget to add the discount from our visit in December.


Bouncers can be intimidating and I think some of their ilk may be borderline psychotic. When I came to in the icy windrow lining 104th Street it occurred to me that maybe I just don’t possess the buying power of Sobeys/Safeway, Canada’s newly steroidal grocery titan. The chain has decreed that its vendors will cut their invoices by one per cent, retroactive to last November 3rd.


One per cent. A single point. Meaningless on a jar of mayonnaise. Significant if you’re negotiating a mortgage. Almost incalculable if you’re reselling millions of dollars worth of product from other publicly traded outfits such as Kraft and Coca-Cola and then withholding shorted payments for something like 120 days. It’s crucial to note here that the two aforementioned Fortune 500 companies have been jamming their own vendors in the same manner for years. There’s a sense that these three corporations, and many others, are now being driven by their CFOs and procurement departments; brand integrity, a genuine affection and belief in their businesses and long term planning are secondary to sniffling on Bay and Wall Streets.


The supermarket is the remora fish of the suburbs. Credit mass production, an ancient White House promise of a chicken in every pot, the post-war boom and the prevalence of the automobile. The grocery industry itself is staid and complacent and always has been. Its two greatest innovations were barbequed chickens and Dave Nichol’s arrogant and audacious gamble that a premium house brand could not only compete with established nationals but top them and make his stores a go-to consumer destination for President’s Choice products.

All stores have bakery and deli departments. Flowers too. Everything else from the coffin freezers, the miniscule organic food aisles and the sad little olive bars has been otherwise knee-jerk and reactionary. It’s an industry of copycats. If Sobeys/Safeway can extract a one point concession, you can be sure Loblaws/Shoppers will join that line and swipe their loyalty card too. The current grocery chain marketing mantra is Locally Grown, Locally Sourced, Local This and Local That. While companies like Kraft and Coke might be able to gag down that one per cent and pass it on to their vendors, tiny family firms like Geoff’s Specialty Meats, Saint Geoffrey’s Happy Organic Cheese and Geoffy’s Gluten-Free Goodies may choke to death.

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