Loblaw makes food safety a top priority
Sharpens focus amid recent health scares

By MARINA STRAUSS
RETAILING REPORTER,
THE GLOBE AND MAIL

Thursday, Feb. 5, 2004 

Loblaw Cos. Ltd. has declared that food safety is a top priority, and has geared up to fight the mounting number of such troubling scares as contaminated salmon, mad-cow disease and bird flu.

"Food safety is the Achilles' heel of our industry, and Loblaw Cos. will absolutely be on the forefront of that issue," Loblaw president John Lederer told CIBC World Markets Inc.'s annual retail conference yesterday.

"It is going to be the killer of our business. We've seen it in one or two stores when there are certain breakouts. It's going to become a more prevalent issue."
The pressure on grocers to ensure that products are safe has been underlined by the rash of food safety crises in the past year or so.

Loblaw, the country's leading purveyor of food, has felt the strains, including class-action lawsuits following a hepatitis A health scare at one of its Toronto stores.
Ultimately these scares can hurt the bottom line. Last week, a Loblaw spokesman said sales of salmon had dipped a bit because of publicity about the potential risks of eating farmed salmon.

Still, the chain continues to support salmon farmers and doesn't see any need to switch to wild salmon, he said.
Yesterday, Mr. Lederer said Loblaw already has measures in place to ensure high food safety standards.

The Toronto-based retailer is the only one in Canada -- and among the few in North America -- to operate its meat department out of a central processing plant, Mr. Lederer noted.

"I'd rather have one factory than 300 factories, because a meat shop is a factory," he said.

Last year, Loblaw appointed Larry Griffin, a former quality control official at the chain, as vice-president of food safety, responsible for the entire company's safety matters. It is the first time Loblaw has created such a national position.

It is a sign that food safety is "a big initiative" for the company, Mr. Lederer said.

Loblaw spokesman Geoffrey Wilson said in an interview later that the focus on food safety by both governments and the public has driven Loblaw to concentrate more on the issue.

"We want to make sure we're consistent and hopefully raise the bar over time across the country," Mr. Wilson said. "We believe it's a high-priority area and we believe it warrants a senior executive looking after it."

Karl Moore, a professor of business strategy at McGill University, said Loblaw is wise to latch on to the food safety issue at a time when there is growing public concern about the matter.

"It's an opportunity, from a marketing view, to establish that you're doing better in this area than others," Prof. Moore said.

Loblaw's sway in the industry will also prompt others in the food chain, from farmers to fishermen, to try to clean up their acts, he said.

Loblaw already has developed organic foods and it may move even further in this area, he suggested.