Quote:
Originally Posted by gunluvr
I've read somewhere that a group of disgruntled shoppers are planning a boycott of Loblaws and their other affiliated stores for the month of May. Would like to hear what members here think of it.
Personally, I don't blame just Loblaws for food inflation. Prices are high everywhere but a boycott of a major grocery chain would send a message and just complaining never gets anything done. This might have some positive effect if enough people follow through.
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You are correct, don't blame the grocery store for high food prices. But they don't deserve to be boycotted.
Loblaws is a public company. It posts audited financial statements. Everyone and anyone can check to see if they are ripping consumers off. So for s*ts and g*gles I looked up their financial results.
Gross profit for grocery + pharmacy has been 30-32% over the past 5 years, this includes the time period when politicians are blaming grocers for "ripping you off". The gross profit on a basket of grocery+pharma has
not changed when inflation was high. Net income margin sits squarely at 10-11%, which is also unchanged. Pharmacy margins are typically 2-3x what grocery margins are so pure grocery net profit is going to be mid to low single digit. That's not much of a profit if Loblaws is ripping consumers off.
If Loblaws is ripping you off then their gross profit margin and the net income percentage would have skyrocketed. But Loblaws is making the same margins as before inflation. It is just their costs have gone up which you are paying for. But the employees aren't going to work for free just as you won't work for free.
What has changed is their sales have gone up as people behave rationally by shopping at grocery stores more and eating out less, so same-store-sales % has grown. If you want to blame anyone, blame Trudeau. He has been printing money out of thin air which is inflationary.
Blaming grocery stores for high food prices is like the bank robber blaming the bank teller. It's willful ignorance and lazy thinking, which is exactly what your federal government is exploiting when they blame Loblaws for a problem they created.
You seen the federal budget details from last week? Massive printing of money is happening again. You want grocery prices to ease up? Easy. Don't elect Trudeau in the past 3 elections.