As Canadians continue to struggle with the high cost of groceries, Costco Canada says the company has taken steps to lower prices on hundreds of items over the past year.
Pierre Riel — executive vice-president and chief operating officer of Costco Wholesale International and Canada — touted several steps the retailer has taken to lower costs during a Tuesday House of Commons agriculture and agri-food committee meeting focusing on stabilizing food prices.
Riel told the committee that Costco has invested in its popular Kirkland Signature private-label brand, increasing the number of Kirkland items on shelves by 12% in the past four years.
He claimed that Kirkland brand items offer at least 20% savings to Canadian shoppers, compared to nationally branded items.
“We have mitigated price increases and accelerated price decreases as input and commodity prices drop, despite the weakening of the Canadian dollar,” he said.
Riel added that Costco is also investing in national suppliers, with 61% of Kirkland products being manufactured in Canada.
“We are always looking to decrease our prices. For example, from the start of 2023, we have decreased the prices on hundreds of items and continue to do so where we can.”
The Costco executive said that the company is “constantly comparatively shopping” with its competitors to keep its prices lower.
“Costco’s answer has always been the same. We will stay true to our business model by offering the best possible prices to our members, we help to stabilize prices and lower the food prices for all Canadians,” he explained.
CEO highlights Costco employee benefits
Aside from Costco’s pricing strategy, Riel also commended the company for its employee benefits.
He noted that Costco’s starting hourly pay increased to $18.50 in September, and the average hourly wage for its employees has also gone up from $27.63 in 2019 to $30.20 today.
Nearly two-thirds (57%) of Costco employees work full-time hours, with part-time employees being guaranteed 25 work hours a week.
“We have among the best-defined contribution pension plans in Canada,” he boasted. “A cashier who has been with us for over six years makes over $70,000 a year.”
CEO talks grocery code
Riel also spoke about Canada’s Grocery Code of Conduct, which is what the federal government and industry experts see as a significant step toward improving the resiliency and efficiency of the grocery supply chain.
The code requires Canada’s major grocery players to sign on and agree to its terms.
Riel said supporting the principles of the code “poses no problem at all.”
While the code was supposed to be implemented by the end of 2023, there have been delays due to Walmart and Loblaw expressing hesitancy to sign on.
While Reil did not outwardly object to Costco signing the code during Tuesday’s meeting, he did emphasize that the company will undergo further review of its terms and details.
“This code of conduct is not an issue for us,” he reiterated.
“We will continue to forwardly review the details of how the code will function, who will participate, how disputes will be resolved and how the code will impact food prices for the Canadian public.”
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