Canada’s largest grocer is freezing prices on all its No Name products until next year as double-digit food inflation causes grocery bills to spiral.
Loblaw Companies Ltd. says it has locked in prices for the popular house brand, which includes more than 1,500 grocery items, until January 31, 2023.
In a letter shared with customers Monday, Loblaw chairman and president Galen G. Weston says the price of an average basket of groceries has risen about 10 percent this year, with items such as apples, soup and chips even more.
He says much of this is out of the company’s control, as food suppliers pass on higher costs to Loblaw.
Weston says that while the grocery chain is pushing the unfair price increases, most of them are reasonable and come from rising basic supplier costs.
He says that’s why Loblaw has decided to focus on what it can control and is locking in No Name prices and promising more deals in the coming weeks to ease rising food costs.
“Anyone who regularly visits the grocery store knows that over the past year the cost of food has risen rapidly,” Weston said in a letter shared with members of the company’s PC Optimum loyalty program.
Similar movements in other countries
The decision to freeze prices for the private label with its distinctive yellow and black packaging follows similar announcements by grocers in other countries.
In August, French supermarket chain Carrefour announced plans to freeze the prices of around 100 of its own-brand products until November 30.
In June, Lidl’s US arm introduced a summer campaign to cut prices to ease the inflationary burden on customers. The company said it lowered prices on more than 100 items at its stores in nine states on the East Coast through August.
“We’ve seen grocers voluntarily freezing prices in the G7 for some time now,” said Sylvain Charlebois, professor of food distribution and policy at Dalhousie University. “It should have happened a long time ago in Canada.”
Still, the No Name price freeze will provide much-needed relief to Canadians, he said.
It will also help repair some of the image problems facing Canada’s big grocers, Charlebois said.
“This is also a PR strategy … many Canadians are blaming grocers for what’s happening with food inflation,” he said. “Some of it is deserved … but much of this criticism is unfair because food prices can rise for a number of reasons beyond a grocer’s control.”