The flyer for the Victory Meat & Produce Market, a small grocer in New Brunswick, recently featured fresh local turkey for $3.99 a pound, two bags of carrots or onions for $4 and a bunch of celery for $2.29 B次元官网网址� prices that rival its national competitors.

For 81 years, the independent store has offered quality products at affordable prices, earning it a loyal customer base despite the increasing dominance of national grocery chains.

B次元官网网址淲e have long-term relationships with suppliers and local growers, and staff that have been here for 20 years,B次元官网网址� said Alex Scholten, co-owner of the Fredericton store. B次元官网网址淥ur customers are like family and I think those relationships are what has sustained us for so long.B次元官网网址�

The mom-and-pop style business has become increasingly rare in CanadaB次元官网网址檚 highly consolidated grocery industry.

Loblaw, Sobeys and Metro make up more than half of all food retail sales in Canada, according to the WhoB次元官网网址檚 Who 2022 report by industry trade magazine Canadian Grocer.

Add Walmart and Costco to the tally, and just five companies control three-quarters of grocery sales across the country, the report found.

That market concentration has come under intense scrutiny in recent months as food prices increased at their fastest clip in 40 years.

All five companies have faced accusations of profiteering, with executives summoned to testify before a parliamentary hearing in Ottawa where they were grilled by MPs about higher grocery bills.

The grocery executives denied the accusations, telling MPs that their margins on food are low.

B次元官网网址淭he truth is we are at the end of a very long food supply chain that has economic inputs at every step and stage,B次元官网网址� Empire president and CEO Michael Medline said to the committee in March.

The federal competition watchdog has separately launched a study into grocery store competition in Canada, questioning whether B次元官网网址渃ompetition factorsB次元官网网址� B次元官网网址� in addition to extreme weather, higher input costs, RussiaB次元官网网址檚 invasion of Ukraine and supply chain disruptions B次元官网网址� could be affecting the price of food. The Competition Bureau plans to publish its findings in June.

The study comes as Ottawa conducts a long-promised review of CanadaB次元官网网址檚 competition laws, one that strives to B次元官网网址渕ake life more affordable for Canadians,B次元官网网址� Innovation Minister Fran莽ois-Philippe Champagne said when the review was launched in November.

Yet when it comes to groceries, just how much consolidation and competition issues influence the price of milk, bread or vegetables is complicated.

While CanadaB次元官网网址檚 grocery sector is highly concentrated, itB次元官网网址檚 also very competitive, said Michael von Massow, a food economy professor at the University of Guelph in Ontario.

B次元官网网址淚 would argue that consolidation provides economies of scale,B次元官网网址� he said. B次元官网网址淚 know the view that thereB次元官网网址檚 value in size is unpopular B次元官网网址� but it probably helps prices. We have a very competitive consumer market for food.B次元官网网址�

The current distrust of grocers likely stems in part from CanadaB次元官网网址檚 bread price-fixing scandal, von Massow said.

In 2017, George Weston Ltd. and Loblaw Companies Ltd. revealed that both participated in an industry-wide bread price-fixing arrangement for over a decade.

CanadaB次元官网网址檚 competition watchdog alleged in court documents in 2018 that at least $1.50 was artificially baked into the price of a loaf of bread during the 16-year bread-price-fixing conspiracy involving the countryB次元官网网址檚 largest bakery wholesalers and grocery retailers.

The Competition Bureau says its investigation into bread price-fixing is ongoing.

The scandal has given Canadians good reason to be skeptical about the cause of high food prices B次元官网网址� especially as grocers post significant profits, von Massow said.

B次元官网网址淲e feel the pinch at the grocery store,B次元官网网址� von Massow said. B次元官网网址淲eB次元官网网址檙e looking for someone to blame and thatB次元官网网址檚 whoB次元官网网址檚 charging us more.B次元官网网址�

But food inflation is due to a number of inflationary pressures that affect the entire supply chain, he said.

Indeed, FrederictonB次元官网网址檚 Victory Meat & Produce Market has seen costs rise more or less on par with the large grocers.

Transportation, utilities, food and labour costs have all soared over the last couple of years, Scholten said.

The store works hard to keep costs low, but Scholten said prices have still gone up.

While more competition in the grocery sector would be a good thing, he said it might not make that much of a difference with prices.

B次元官网网址淚tB次元官网网址檚 just the environment weB次元官网网址檙e in right now,B次元官网网址� Scholten said. B次元官网网址淓verybody is facing significant cost increases.B次元官网网址�

Still, CanadaB次元官网网址檚 big grocery chains take advantage of their size and possibly even engage in uncompetitive behaviour, von Massow said.

B次元官网网址淚 think where theyB次元官网网址檙e leveraging that market power is back up the supply chain to suppliers,B次元官网网址� he said. B次元官网网址淚t can make it tough for smaller, independent grocers to compete because they canB次元官网网址檛 buy as well.B次元官网网址�

Indeed, one of the keys to VictoryB次元官网网址檚 success is its wholesale business.

B次元官网网址淲e offer both retail and wholesale products, so weB次元官网网址檙e able to build a volume thatB次元官网网址檚 sufficient enough to give us the buying power to compete with much bigger competitors,B次元官网网址� Scholten said.

Michael Graydon, CEO of supplier industry group Food, Health & Consumer Products of Canada, said there are both benefits and drawbacks to concentration in food retail.

B次元官网网址淭he grocery market is consolidated, thereB次元官网网址檚 no question about that,B次元官网网址� he said. B次元官网网址淭here are some benefits. They are very sophisticated retailers with a robust supply chain, so getting products from the manufacturers to distribution to store tends to be fairly efficient.B次元官网网址�

ItB次元官网网址檚 also easier selling to five companies rather than 25 for some suppliers, he said.

But there are downsides as well, Graydon said.

B次元官网网址淭here is a power imbalance and this is fundamentally why weB次元官网网址檙e working toward a code of conduct,B次元官网网址� he said.

The industry-led Canadian grocery code is expected to be released in the coming weeks.

The document is expected to increase B次元官网网址渇air and ethical dealingB次元官网网址� across the grocery supply chain in Canada, according to a draft version of the code viewed by The Canadian Press.

B次元官网网址淚t establishes some rules for engagement,B次元官网网址� Graydon said. B次元官网网址淚t takes away a lot of that unilateral decision-making and imposing terms on manufacturers without negotiations.B次元官网网址�

But the drawback of levelling the playing field between grocers and suppliers could be even higher prices, von Massow said.

If you limit the degree to which grocers can put pressure on suppliers, he said it could take money out of the grocersB次元官网网址� pockets.

B次元官网网址淭heyB次元官网网址檙e either going to eat that B次元官网网址� and it will have no impact on prices B次元官网网址� or theyB次元官网网址檙e going to pass at least some of it on to consumers,B次元官网网址� von Massow said.

B次元官网网址擝rett Bundale, The Canadian Press

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