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Unformatted text preview: stores and remodeled stores have a floral department, garden shop, in-store bakery,
deli, and pharmacy services. A drive-through home-meal replacement store is being built in
Canada Safeway has strong private brands. The “Select” label covers premium products. Other
brands such as “Lucerne” (dairy products), “Edwards” (coffee), and “Empress” (jam), are popular
with consumers. Canada Safeway has two customer loyalty programs: Airmiles™ and Safeway
The current challenge to Safeway is managing its costs. Steps taken to reduce costs include
closing unprofitable stores, reducing headquarters’ personnel, and improving the efficiency of
manufacturing operations. The biggest challenge, however, is closing the gap between its
relatively high labor costs and those of its competitors.
2. The Oshawa Group
The Oshawa Group, headquartered in Etobicoke, Ontario, is the franchiser in nine provinces for
655 IGA food stores and regionally for 845 Knechtel, Food Town, Bonichoix, and other
independent grocers. It operates 105 corporately owned supermarkets, primarily in Ontario and
The company grew principally by acquiring regional operations. Only recently have these
operations been consolidated into three regional food distribution divisions. Each region piloted
different information systems that are being adopted nationally. The central region developed
19 Competitors information taken from the various competitors published annual reports, industry analyses by various brokerage
houses (e.g., First Marathon, Morgan Stanley, Dean Witter), various articles in Canadian Grocer, Supermarket News, Progressive
Grocer, Canadian Business, Financial Post, Globe and Mail and Toronto Star. 10 n KPMG/University of Illinois
Business Measurement Case Development and Research Program July 1999o continuous replenishment, the western region developed electronic data interchange (EDI), and
the eastern region developed direct-store delivery. The Oshawa Group also will standardize
merchandise procurement, human resources, finance, retail store development, and design.
The Group focuses on two markets: wholesale and retail servicing of home-consumption (Agora
Food Merchants) and restaurants and hotels (Serca Food Services). The latter is Oshawa Group’s
response to the growth of ready-prepared foods. Instead of simply selling ready-prepared meals
through grocery stores, the Group is supplying alternative food sources. Serca is far and away the
largest supplier in its market.
In the home-consumption market, the Oshawa Group emphasizes stores in the 18,000 to 40,000
sq. ft. category with some substantially larger stores. In the competitive Ontario market, two new
concept stores have been opened. A traditional 15,000 sq. ft. store in central Toronto
concentrates almost 50 percent on fresh produce plus meal solutions. A similar emphasis defines
the larger IGA Marketplace in Mississauga. These stores avoid head-on competition with
Loblaw. The Oshawa Group has a strong and...
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This note was uploaded on 01/27/2014 for the course ACCY 405 taught by Professor Staff during the Fall '08 term at University of Illinois, Urbana Champaign.
- Fall '08