**Toronto**: Loblaw Companies Limited is proactively addressing potential U.S. tariffs on Canadian imports. CEO Per Bank highlighted strategies, including promoting domestic products through their PC Optimum app and a significant rise in sales of Canadian-made items amidst ongoing trade tensions between Canada and the U.S.
Loblaw Companies Limited, one of Canada’s largest food retailers, is actively working to mitigate the potential impact of proposed tariffs by the Trump administration on Canadian imports. During a conference call with analysts discussing the company’s quarterly earnings on Thursday, CEO Per Bank outlined the measures being taken to address concerns around U.S. tariffs.
Bank noted that U.S. products comprise less than 10 per cent of Loblaw’s product offerings, primarily in the produce category, which he identified as “the most difficult place” to adapt to potential tariff changes. Despite the relatively small share, he stated, “I think we can probably mitigate half of our suppliers,” emphasising the company’s commitment to reducing the impact of potential trade barriers.
The situation arises against a backdrop of escalating trade tensions, as U.S. President Donald Trump has threatened to impose a 25 per cent tariff on non-energy imports from Canada. In response, Prime Minister Justin Trudeau has promised retaliatory measures. Although these tariffs have not yet been implemented, Canadian consumers have begun to pivot towards domestic products, with many expressing intentions to “Buy Canadian.” This movement has prompted Canadian grocers, including Loblaw, to seek alternatives to U.S. goods and to promote local offerings.
In an effort to support this shift, Loblaw has introduced an innovative feature within its PC Optimum app called “swap and shop.” This tool allows customers to replace items on their shopping lists with Canadian-made alternatives. Bank reported a substantial increase in usage of this feature, noting a 75 per cent week-over-week rise as consumers look to prioritise Canadian products.
Additionally, Bank highlighted a notable surge in sales of domestic products, with a 10 per cent weekly increase noted in early February. This rise in Canadian product sales precedes the anticipated rollout of labels indicating which items are manufactured in Canada, with broader implementation expected in the coming week.
In certain categories, Loblaw is already well positioned to provide alternative options. For instance, in the household and cleaning supplies sector, where the company typically sources from over 30 U.S. vendors, Loblaw’s own brands, No Name and President’s Choice, offer Canadian-made products. Bank commented on the competitive advantages these local alternatives would evoke in the event that tariffs are enacted: “If the tariffs are applied on household and cleaning, then of course those products will not be competitive anymore, and all the sales will go to our control brands, and they’re all produced in Canada.”
Overall, Loblaw’s strategies are indicative of the retail sector’s response to the evolving trade landscape, focused on bolstering Canadian product offerings while ensuring customer needs are met amid potential tariff-related challenges.
Source: Noah Wire Services
Subscribe to Industry Updates
