Information on Loblaws
Loblaw Companies Limited is the largest Canadian food retailer, encompassing corporate and franchise supermarkets operating under 22 regional and market segment banners (including Loblaws), as well as pharmacies, banking and apparel. Loblaw operates a private label program that includes grocery and household items, clothing, baby products, pharmaceuticals, cellular phones, general merchandise, and financial services.
Loblaw’s regional food distribution divisions include Westfair Foods Ltd. in Western Canada and Northern Ontario, National Grocers Co. Ltd. in Ontario, Provigo Inc. in Quebec, and Atlantic Wholesalers Ltd. in Atlantic Canada.
Loblaw brands include No Name, President’s Choice, Life Brand and Joe Fresh. Loblaw stores include Loblaws, Zehrs, Your Independent Grocer, Provigo, Atlantic Superstore, Fortinos, Dominion, Independent City Market, Valu-mart, ARZ Bakery, Wholesale Club, T&T Supermarket, Real Canadian Liquorstore, Real Canadian Superstore, No Frills, Maxi, Extra Foods, and Shoppers Drug Mart.
‘No Name’ is one brand in particular that stands out. At a time of high inflation and consumer complaints about ever increasing food prices, No Name proved popular, with sales exceeding the company’s own projections, as noted by Loblaws president Dave Nichol:
“Since Loblaws introduced its 16 no-name products, it has sold one million units with many repeat purchases. “The suppliers of a number of these products can’t keep up with the demand. In several cases, we’ve sold in two and a half weeks what we originally estimated would be our annual requirements.”
Within months of the No Name launch, Loblaw opened a prototype No Frills store in East York. Also known as a ‘box store,’ since items were not individually shelved but left in their cardboard shipping cartons, usually with the front cut away, the new store advertised “the lowest overall prices in Toronto.” Though customers had to pack their own groceries, bring their own bags, or pay 3 cent apiece, and contend with a limited selection of only 500 items, shoppers crowded the store on opening day. Customers gave up other standard conveniences, such as full-service meat or dairy departments, since refrigeration units had been removed to cut costs. In spite of the limited selection and minimal service, the first No Frills store proved a success and within months the company converted two more Loblaws locations to the new deep discount format.
Customers have different tastes and these need to be addressed differently. Each customer has to be connected to separately. This means, the supermarkets try to address the needs and interests of individual customers. This is by offering local, international, and metropolitan products. Thus, as a vendor, you should be looking at getting varieties to the retailer.
You need a unique selling point as a vendor – this is what sets you apart from others. Look at your products and see what you are offering differently. If not different, go back to the drawing board and see how you can rebrand or bring out a distinction. Distinctiveness can help you carve a niche for yourself in the marketplace.
How to get your product into Loblaws
- Understand you client: Before you spend a lot of time and money creating a product, you should know if anyone will want to buy it. Learn more about Market Research
- Learn if it’s protectable: Know if you can defend your product against cheap copies if it gets knocked off. Learn more about Copyright and Patent your product
- Test your product: Make sure that there’s a demand for your product and the customer understands what you are selling when it’s on the shelf and nobody is there to explain it. Learn more about Product Testing
- Perfect your pitch: Before you speak to decision makers, know your numbers, know your retailer and know your logistics in and out. Learn more about Pitching Your Product
- Don’t do it alone: If you haven’t been successful in retail before, a secret of success is that you can’t do it alone. Having great sales staff, customer support and marketing partners can take you from zero to success faster than if you tried on your own. Learn more about Retail Partnerships
Contact Loblaws Buyer
Do not trust any “list” of buyers.
Typically retail buyers change either companies or positions every few years. This strategy helps retailers know that their buyers are not taking “kick-backs” and are selecting the very best product for the very best position each time.
Buyers are typically held to a very rigorous standard of sell-through volume that they must hit and because of this they are risk averse. Your job as a supplier or vendor is to convince them that the buyers going into the stores not only know about what you’re selling but are actively seeking the product in the store currently.
Sometimes easier said than done, however you must get on Loblaws radar.
Call the Loblaws corporate phone number and ask for the names of the buyer and assistant buyers in your category.
Always leave voicemail with whomever the dispatch will connect you.
Use that information to connect with them on LinkedIn, RangeMe and any other professional social platform.
Ask your representative at your trade bureau to connect you to the Loblaws buyers as they will potentially have a better history.
Use advertising, public relations and marketing to make your brand known to Loblaws buyer through 3rd party websites & industry media sources.
Be everywhere that they look, the key is to position your brand as the obvious choice when Loblaws is looking to either refill a slot or create a new category.
Latch on to the news of the day and any trend that will make your product fill that niche whether that be Non-GMO or Vegan Leather for example.
Investing in your brand can only benefit your opportunities in the future. As being “top of mind” will have a ripple effect when you physically present your product at a Loblaws buyers meeting or trade show in the future.
Loblaws buyers typically got to their position by picking “winners” and know how to see through the fluff.
Focus on the numbers, know your bottom dollar during a negotiation and how fees and chargebacks may cut into your position.
Know that long term success may outweigh short term sales, however financing large purchase orders from Loblaws when the net result is negative is not sustainable.
Understand the playing field and the other brands that are in your space, what they are offering as promotion and pricing and how you can stand out against them.
By knowing that each buyer at Loblaws probably knows more than you do, take an active listening approach to sales and understand that no is a perfectly acceptable answer that may have saved you millions of dollars on the backend.
How to Submit a Product to Loblaws
Here are the 6 steps you need to take to have your product placed in Loblaws.
1. Start with the right questions.) Before you try distributing your product to Loblaws, you need to ask yourself a few basic questions. Do you need to build demand for your product, or is there already a demand for it? Do you know that Loblaws would be interested in selling your product? If you can strike a deal with Loblaws, can you handle the production volume? Do you want to sell directly to Loblaws, or do you want to license your product to a manufacturer that will handle distribution?
2. Be prepared to profit.) Does your product offer enough of a profit margin for Loblaws? Can you sell your product at a reasonable enough profit to cover the packaging, shipping, commissions, marketing and wholesale distribution? Check Loblaws guidelines for other fees that you will have to build into the cost of your product in order for you to be able to turn enough of a profit to make the effort worth your while. If you work with a discount retailer, they will try to strip your profits down to zero in order to keep their prices as low as possible.
The typical breakdown of margins are: If a products costs $1 to produce, that product will retail for $4. That product that retails for $4 will wholesale for $2 to distributors and stores that purchase direct. Big box retailers like Loblaws may offer to pay $1.25 to the manufacturer if the product costs $1 to produce. That is the typical profit margin.
3. Determine if Loblaws is the right store for your product.) The relationship between you and Loblaws starts with you browsing their store for competing products. If Loblaws already has a similar product, it is going to be very difficult to get your product picked up. Spend some time at your local Loblaws to see what kind of products they are selling, speak to the manager and see if he thinks your product will sell well in their store. Picture in which zone your product would best fit on the shelf and keep in mind that the most precious asset that these big box stores value are their shelf space. Keep this information in mind when you are preparing your presentation to Loblaws.
If your company is minority or women owned, check Loblaws and see if they offer specific opportunities for those designations.
4. Pitch your product to Loblaws) Decide whether it will be you or a representative to present your product to Loblaws. Your presentation depends heavily on your strengths as a businessperson as they will most likely ask financial questions and logistics questions.
It’s common for companies to hire a broker to pitch their product to Loblaws, as it will be more likely that your product will make it to the next stage if the individual pitching your product has industry knowledge or a personal relationship with Loblaws. The percentage of commission verses, however generally a broker will take around 5% to represent your product to Loblaws.
We at Mr. Checkout have experience dealing with brokers and know that there are several retail brokers that have poor business practices that can potentially damage your brand. If you are seeking a legitimate Loblaws broker, please give us a call for a recommendation. It could save you a huge headache and a lot of money.
5. Complete the required Loblaws paperwork.) Often Loblaws will have you go through an application process. However, before submitting the paperwork required by Loblaws, you should contact a buyer at Loblaws and let them know your intentions. Having a contact inside of the company will potentially move your application more smoothly through the process.
6. Anticipate the need for increased volume.) Having Loblaws agree to stock your product will most likely mean a significant increase in volume. You should be prepared to ramp up your production and informing your manufacturer of this opportunity.
Having production, logistics and distribution to sync is not only difficult, it requires a significant amount of time invested in customer relations. Also, Loblaws may have stipulations in the contract that may penalize you for delays in shipping and production. Have an attorney explain all contracts to you if you don’t understand the terms.
If you’re looking to sell your product to Loblaws, be sure to thoroughly assess the marketplace, carefully prepare for production growth, and take full advantage of resources available to help you grow your business.
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