Loyalty programs: the Metro store does not advance

Photo: Olivier Zuida The Duty
Metro and several other grocers focus since a few months on cost-cutting measures to adjust to increases in the minimum wage in some provinces of the country.

The big boss of Metro believes that it is still too early to say what awaits the loyalty programs of the grocery store and Jean Coutu Group after the marriage of the two florets will have been done, the next year.

 

Questioned by analysts on Wednesday as part of the unveiling of the results of the fourth quarter, Eric The Arrow did not wanted to open up his game, but has, nevertheless, stated that the company was looking into the case. “It will be necessary to look at the portrait as a whole and develop our own strategy, he said during a conference call. But it is still too early for the moment. “

 

In Quebec, the supermarket chain put on the program Metro and me while in Ontario, his partner is Air Miles — the loyalty program of the network of pharmacies from Jean Coutu.

 

The president and chief executive officer of Metro, however, has been careful to remind analysts that the program currently in effect in Québec was “highly valued” customers and that it had been proven. “All programs need to evolve “, has launched Mr. The Arrow, in response to a question about Air Miles.

 

Announced in October, the transaction of $ 4.5 billion for the third supply chain in the country to put a hand on Jean Coutu must be finalized during the first half of 2018.

 

Earlier this month, customers of Shoppers Drug Mart — Pharmaprix in Quebec — and food markets of the company, Loblaws — Provigo in Quebec — had learned that they would soon have a new loyalty program uniform to replace the Optimum points and PC Plus. Loblaws had confirmed its intention to merge the two programs, effective February 1, 2018.

 

Challenges

 

With respect to its performance in the fourth quarter — which included an extra week — ended 30 September, Metro has earned a net profit of 154.9 million, or 66 cents per share, an increase of 6.8% compared to a year ago. For their part, the sales showed an increase of 10.2 %, to $ 3.2 billion. The growth in sales of stores open for at least a year amounted to 0.4 %, whereas it was 2.8 % during the fourth quarter of last year.

 

For the year, Metro has posted net profits of 608,4 million, or 2,57 $ per share, up 7.5 %, while its revenue rose 4.6 %, to $ 12.8 billion.

 

Mr. Arrow has however to be noted that, like other businesses, the grocer will have to adjust to the increase in the minimum wage in Ontario will increase from $ 11.40 per $ 14 per hour as of January 1, 2018. On an annualized basis, Metro believes that this change will cost him between $ 45 million and $ 50 million. “There is no big magic formula. We look at the side of productivity, technology and efficiency. Some stores open 24 hours will be. It is necessary to manage the cost of labor without reducing the service to the customer. “

 

Metro and several other grocers focus since a few months on cost-cutting measures to adjust to increases in the minimum wage in some provinces, as well as the pressure due to the competition of retailers to lower prices and to the acquisition of Whole Foods by Amazon.

 

In addition, the grocer québec wishes to penetrate the ontario market towards the end of the year 2018 with its service allowing you to order groceries online. In Quebec, the seven locations in the regions of Montréal, Québec and Gatineau currently offer this possibility to their customers.

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