In a recent interview with the Globe and Mail, Michael Medline, CEO of Sobeys and parent Empire Company Ltd., noted that the grocer will be ramping up its customer service. According to the Globe, Medline reports that Sobeys is “gearing up for the fight of his life in a business transformation he dubs ‘Project Sunrise.’”
This turnaround plan will include cutting costs, simplifying company structure, reconnecting with customers, and fixing problems in the grocer’s western division—all in an increasingly competitive landscape. Through this, Medline hopes to improve the company’s financial results. In its most recent quarter, the company reported a $30.5-million profit, compared with a $1.4-billion loss a year earlier. However, during the same quarter, sales slipped from $6 billion to $5.9 billion.
“Our results are not where they need to be,” says Medline. “We’re not messing around here. We’re going to get at [these changes] very soon. I don’t see any reason to elongate the process. I think it’s good for the customers and it’s not fair to the employees, who have been hearing about this restructuring for over six months.”
To compete in the cutthroat grocery market, the former Canadian Tire CEO plans to focus on Sobeys’ strengths of higher-margin fresh produce, meat, and seafood, as well as the Compliments private label products.
Medline also notes that he will not drop the Safeway name in favour of Sobeys, as Safeway is a valuable banner in the West. He also will not be selling these stores to rival Overwaitea Food Group, who has expressed interest in the discount banner. Moreover, Medline may consider the expansion of Sobeys’ Ontario-based FreshCo discount chain to the West, but this will not happen in the near future.
