Loblaw is about to acquire Shoppers Drug Mart in their expansion into drug and convenience. At first glance, one might wonder why this acquisition makes sense. Shoppers female shopper, their loyalty information, and the aging population and their need for pharmacies are all plausible explanations. But, according to the Canadian Convenience Store Association (CCSA), they believe Shoppers might look like mini-Loblaws stores according to the 2013 state of the industry report recently released.
Loblaw has already tested their President’s Choice products in convenience retail with Imperial Oil. There is no doubt, that any offer that Loblaw might consider, will focus on time-starved customers that need quick meal solutions. South of the border, Walgreen’s new stores offer more fresh and convenience foods.
Alex Scholten, president of the CCSA stated “I think it’s a big threat, actually, and it’s not only Shoppers — we are seeing a lot of different retail channels encroaching on our turf …,”and added “Consumers are going to go to the closest place to them, and if they are near a drug store or a Walmart, it does pull them away from us,”.
Target’s recent expansion in Canada has increased competition with them offering products in single-servings sizes and extending their hours of operation. Almost every check-out (Home Depot, Michaels, Best Buy) to name a few, have some form of impulse convenience at their pay points.
Will Shoppers Drug Mart, add convenience store to their signs? I don’t think so, but their offer may very well aim at the majority of cstore sales with the exception of tobacco (where pharmacies are prohibited from selling tobacco products).