Casual commentary about political, cultural and economic issues with a particular interest on the city of Winnipeg by John Dobbin
Wednesday, June 12, 2013
Canada Safeway Sold to Sobey's
To certain, it looked like something had to change with so many food retailers crowding into the market. It will be Canada Safeway that retreats back across the border with its tail between its legs and $6 billion in its pockets with Sobey's grabbing up all their stores and concerns.
Winnipeg has a long history in Winnipeg as city was the headquarters starting from 1928. Eventually, executive offices moved to Calgary although Winnipeg continues to have as many as 40 back office people based around their Waverley offices. The old Pacific offices have long since been vacated.
I am uncertain when head office functions moved west but the 1980s were unkind to Winnipeg with recession and bruising company closures. This is when Read Canadian Superstore's WestFair Foods noisily exited decrying the NDP's payroll tax. I think Safeway slowly followed suit.
It is uncertain what will happen to office staff given that Sobey's will look to end redundancies. This is more likely to have a huge impact where Calgary has close to 600 head office staff now. The 40 staff in Winnipeg may have a better chance as back office functions for the west might best continue in a less expensive city than Calgary.
The very large distribution center of Safeway set up in 1962 and with about 80 employees is part of the sale to Sobey's. It is difficult to say what will happen there as Sobey's as massive 350,000 square foot warehouse on Inkster. However, a lot of the recent expansion there has been to supply Target with food product.
There are 10 Sobey's in Winnipeg, a Cash and Carry and other associated stores of the company. Safeway has 20+ stores. There is going to be some cross over.
Do we see store merged? Do we see some sold? Do we see some go under a new banner and marketed differently? What about Airmiles and Safeway cards? So many questions.
Safeway has been part of people's lives here for a very long time. It is not hard to see they have been struggling though and there have been pressures on staff along the way. Those pressures are likely to continue.
Sobey's has a pretty good reputation and is a Canadian owned company. Perhaps a sign of good things to come.