Canada’s largest grocer plans to invest $1.2 billion and build 50 new stores as well as renovate or improve more than 100 existing stores this year.
Loblaw Companies Ltd.’s (TSX:L) investment will be spread across Canada. No one from Loblaw was immediately available to say how much of that investment would be spent in B.C. but the Canadawide investment is expected to add more than 20,000 jobs through more staffing and construction.
The investment includes e-commerce expansion and continued investment in supply chain and technology infrastructure.
This comes on the heels of a recent IbisWorld study that showed that groceries were the second fastest-growing global e-commerce category, behind menswear.
“While we continue to invest in the information technology and infrastructure engines of our business, we're increasingly making investments that Canadians will see with their own eyes – improving our offer, adding stores, and creating jobs locally,” said Loblaw president Galen Weston.
“True to our strategy, our investment will create better access to fresh food, wellness solutions closer to home, e-commerce convenience, and a family of stores that elevate grocery, pharmacy, apparel and banking experiences.”
Much of the spending is likely to help rejuvenate the company’s Shopper’s Drug Mart brand, which it bought in a $12.4-billion megadeal in 2013.
Other Loblaw brands include its namesake grocery stores as well as No Frills, Fortinos and Joe Fresh.
Loblaw is likely to benefit from Target Canada’s decision earlier this year to close its 133 stores. The company still faces competition from Walmart, which has been expanding its Canadian operations and including more groceries.
Global grocery e-commerce sales rose at an average annual rate of 16.7% rate between 2010 and 2015, according to Australia-based IbisWorld.
The company pinned current annual grocery sales at US$12.7 billion and it projects that annual growth for grocery e-commerce will slow to 12.2% between 2015 and 2020.
