Loblaw is launching a new ultra-discount grocery store concept called No Name in Ontario. The first three stores will open in Windsor, St. Catharines, and Brockville in September. The stores will offer even lower prices by reducing operating costs and simplifying the shopping experience. No Name is based on Loblaw’s existing discount brand known for its bright yellow packaging and marketing. The company has been investing in its discount store network in response to consumer demand for affordable grocery options.
The No Name stores will have about 1,300 products, compared to up to 7,000 products at traditional grocery stores. The goal is to make the shopping experience as simple as possible for customers. The stores will have shorter operating hours, limited marketing, and no flyers. They will offer a range of frozen items, packaged bakery items, produce, and pantry staples, but no refrigerated foods. The company plans to reduce costs by using reused fixtures and avoiding self-checkouts in the beginning. Building these stores will cost only 10 to 20 percent of a new regular-sized No Frills store, allowing for significant cost savings for customers.
Prices at the No Name stores will be up to 20 percent cheaper than comparable products at other discount stores, including Loblaw’s own No Frills stores. More than three-quarters of the products will be more than 10 percent cheaper, and two-thirds will be priced below $5. Additionally, nearly 60 percent of the products will be No Name or President’s Choice brands. The idea for the No Name concept originated from Loblaw’s CEO Per Bank’s experience testing a similar concept in Denmark. Although the previous concept did not succeed, Bank believes it has potential in the Canadian market due to a wider customer base and brand recognition.
Bank sees discount grocery stores as a growth engine for Loblaw in the coming years. He believes that No Frills, Maxi stores, smaller-format No Frills locations, and potentially the new No Name stores will drive growth for the company. Bank has brought a focused strategy for discount to the company, along with a “test and learn” approach that is evident in Loblaw’s recent discount ventures. The company is open to testing new ideas and pivoting based on learnings. Within six months, Bank expects to have a good idea of whether the No Name concept is successful. The company is confident that the simplified, low-cost approach will appeal to customers looking for affordable grocery options.
