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“There are a number of questions and people don’t know the answer to — how big will click and collect get, what does this mean for Canada, and what does this mean for grocery longer term? With all of these regulatory issues, this is another headwind for Loblaw to battle against.”

Shares of Sobeys owner Empire Co. fell roughly 2 per cent in afternoon trading Wednesday, as did those of Metro Inc., the country’s third largest grocer.

Whole Foods operates only 13 stores in two Canadian provinces, British Columbia and Ontario, but industry watchers believe the impact of Amazon’s deal could transform the grocery industry in North America, giving the online giant clear bricks and mortar access points.

Loblaw will have click and collect rolled out to 200 of its stores by the end of this year, and Walmart is fast behind it.

Walmart offers click and collect on fresh grocery orders at dozens of stores in Ontario, and plans to have 100 stores up and running by the end of the year before rolling it out to the remainder of its 410 stores in Canada. It also delivers groceries to select condo complexes in Toronto.

Revenue at Loblaw rose 3.2 per cent to $11.08 billion and same-store sales, a key measure of retail performance, rose one per cent. Grocery retailers have faced tepid same-store sales results for the better part of a year as food price deflation has eaten away at overall revenue and they compete aggressively with one another on price. Loblaw’s food prices fell slightly more than average quarterly national food price deflation of 1.4 per cent, the retailer said.

At Shoppers Drug Mart, same-store sales were up 3.7 per cent. The company continues to be pleased with the results of rolling out fresh food to selected Shoppers Drug Mart locations in urban centres, most recently extending the program to the Vancouver area. “People are looking for a top-up fresh food shop that is close to where they live,” Weston said.

Financial Post

hshaw@nationalpost.com

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