Canadian Grocer


Title: Can poor people eat well?

Sub-title: Food inflation and store access challenges are hitting Canada’s poor hard. Can grocers help?


International economists don’t mince words: Canada is part of a select group of “rich” world nations. Canadians’ $39,000 per capita GDP is massive by global standards, which means we spend smaller percentages of our incomes on food, clothing and housing. With that kind of wealth, Canadians surely must be providing the less fortunate enough aid to properly feed themselves.


Not so, says James Milway, executive director at the Institute for Competitiveness and Prosperity. “Food inflation (which is rising faster than regular inflation) has gone up faster in Canada than welfare payments, and many people are hurting,” says Milway. “The diets of poor Canadians have long been worse than those of wealthier ones. But now the situation is worsening.”


The institute recently released a study which noted that more Ontarians are turning to private charities. During 2009 more than 375,000 of them used the services of a food bank each month, up 19 percent from the previous year. “This signals the alarming effects that the recent recession has had on diets and health,” said Milway.


The study, titled The poor still pay more: Challenges low income families face in consuming a nutritious diet, recommends ways to help. These include providing grocers incentives so that they locate their stores in areas where they are accessible to lower income Canadians, a new housing benefit to provide the poor more cash to pay for food and eventual elimination of price fixing by the milk marketing boards.   


Why the diet gap?

One major problem of concern to grocers is the report’s claim that the poor have trouble accessing a healthy diet. “Many Ontarians, live in low income communities where there are few retailers that sell fresh fruits and vegetables and other nutritious foods,” says Milbank. “This creates problems because the poor often don’t have access to cars to make destination trips to major outlets. That means they need to make a massive time investment to go food shopping. Then they have to haul those bags home on public transportation, which makes it difficult to bulk shop to take advantage of savings.”


The existence of these “food deserts” is nothing new. However the problem is not easily solved. For example despite the relatively inexpensive lodgings that exist in many low income neighbourhoods, many of these are multi-story complexes in relatively high population density areas. That means land costs there are prohibitively high, and would almost certainly preclude the economical construction of a large grocery outlet. Zoning bylaws too are a problem in many urban areas, as are the difficulties in managing a heavy flow of supply trucks there. In poorer rural areas, grocers face opposite problem: population density is often too low.


“We locate our stores in areas that can justify one,” says Susan Shutta, director of corporate affairs at Walmart Canada. The company, whose core business is catering to budget-conscious customers, recently announced that it was opening 40 new supercenters in the coming fiscal year and refocusing its efforts on its fresh produce, moves that Shutta believes will contribute to Canadians’ overall nutrition.


Improved food quality

According to one poverty activist, Quebec’s poor face many of the same challenges as those in Ontario. “Traffic to our food bank increased significantly during the recession,” said Eric Kingsley, coordinator of the emergency services program at Sun Youth. “The poor cannot negotiate their rent, hydro and car payments, so when tough times come they easiest way to cut expenses is in their food budgets.”


However poorer Canadians don’t just have challenges regarding the quantity of food that they get and their access to it, quality is also an issue says Milway. “The poor buy the same proteins that the rich do, but they consume the less healthy parts,” says Milway. “For example they eat hot dogs and hamburgers as opposed to pure beef. And if they can afford a steak, their cuts will have more fat and bones in them.”


Kingsley agrees. “A lot of it relates to pricing,” he notes. “If a big bottle of cola costs less than a carton of orange juice or milk, the purchase decision can be a tough one. The same applies to whole grain crackers which are far more expensive than the cheaper crackers.”


Kingsley believes that education also plays an important role in getting Canadians to eat better. “We have a culture in which many people think you should eat meat at every meal. That’s 21 times a week,” says Kingsley. “However if you skip meat now and then and replace it with lower cost options such as chick peas or lentils, you can save a lot of money.”


Grocers can help

While grocers alone cannot solve the substandard nutrition problem on their own, there are some steps that industry stakeholders can take to contribute to an overall solution.


 “We are not blaming them,” says Milway. “But they could be more aggressive with municipalities regarding zoning requirements and a little more innovative in the way that they set up stores in urban neighbourhoods.” Milway cites the Bloor Street Market, which is owned by Loblaws, as an excellent example of a company successfully locating a store in a high population density, though higher income, area. “If they could do the same in lower income neighbourhoods it would be a good start,” says Milway, who notes Sobeys too has been starting to open more smaller stores in the city, which he regards as a positive step.


Milway also notes the pernicious effect that supply management in the poultry, dairy and egg sectors, which account for 20 percent of Canadian agricultural sales has on food prices, often raising them to many times what they would ordinarily cost in a free market.


For his part, Kingsley adds that grocers could be far more careful when managing the outdated produce that they sometimes ship to food banks. “While we are happy to accept the older produce, often grocers await too long before shipping it to us,” says Kingsley. “Often, not only can we not use much of it, be we also incur heavy waste management fees to have the stuff hauled away.”



Recommendations for government and industry


  • Promote better education about nutrition and diet

  • When possible grocers should contribute more and better quality merchandise to food banks.

  • When contributing produce, grocers should ship it out faster, while it is still usable, rather than letting it rot in the warehouse until they can send a full truckload.

  • Improved incentives for retailers to increase food accessibility in low income neighbourhoods.

  • Grocers need to be cleverer in negotiating with zoning authorities when establishing new locations.

  • Grocer need to be innovative in creating store designs for specific areas.

  • Governments need to take action to eliminate dairy quotas which artificially raise milk and other prices, disproportionately hurting the poor.



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