Why Loblaw Irks Canadians So Much

Loblaw Companies Ltd. Thursday reported a drop in its profit and revenues for the fourth quarter, as the Canadian supermarket chain continues to be impacted by the industry-wide price bread price-fixing scandal.

In December, Loblaw confirmed that it had participated in an industry-wide arrangement to fix the price of some bread products over roughly 14 years. The company said it brought the information to the Competition Bureau as soon as it was discovered.

The Competition Bureau’s investigation into bread price-fixing included– retailers Loblaw, Walmart, Sobeys, Metro and Giant Tiger and suppliers Canada Bread Company Ltd. and George Weston Ltd.

Both Loblaw and George Weston Ltd. were granted immunity for coming forward and tipping off the watchdog. Meanwhile, some companies, including Metro and Sobeys, have denied any wrongdoing.

In order to regain the lost loyalty and as a goodwill, Loblaw is offering customers a $25 card that can be used at its grocery stores across Canada.

However, according to a public relations expert issuing a $25 card would be inadequate to regain the lost goodwill.

“What Loblaw is doing with their gift card program is cold comfort crisis communication,” Bob Pickard, principal at Signal Leadership Communication, told BNN via email. “On one hand, it is a commendably proactive PR gesture and offers real money to consumers; but, on the other hand, it is an inadequate remedy considering the reality of what they have done.”

by RTT Staff Writer

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