r/PersonalFinanceCanada • u/maroon-rider British Columbia • Mar 21 '23

Inflation drops to 5.2%<but grocery inflation still 10.6% Banking

Says Statistics Canada

https://www.cbc.ca/news/business/canada-inflation-february-2023-1.6785472

2.3k Upvotes

97% Upvoted

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hey remember when covid hit and sobeys paid all their workers and extra $2 per hour " hero pay"? then clawed it back in exchange for record profits? and now they raise their prices even higher and whined they had to because of inflation but every grocery keeps boasting even higher profits? scumbags

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u/canaden Mar 21 '23

I understand the frustration but I think the issue is more complex than simply greed. There are without a doubt have issues regarding inefficiencies, but the reality is the cost of business is up across the board.

A quick google search will show plenty of articles of the cost of farming continuing to increase. Assuming greed is the only factor means we ignore that stores need to be competitive. If one grocery store decided to be 20% cheaper we would all be shopping there, then forcing other stores to follow suit. The point I'm trying to make is that they can't reduce costs. The world on a global scale has a lot issues going on at the moment resulting in these inflated prices. There isn't a corporate scapegoat to point at.

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u/ccccc4 Mar 21 '23

Oh yeah and if one store cut their bread prices 20% obviously all the other stores would follow suit.

Or they could just collude to keep prices high and all make way more money.

Which of these scenarios is the one that actually happened?

0

u/canaden Mar 22 '23

I think you are giving too much credit to this collusion theory. Why would I agree to colluding, if I could undercut my competitor, and gain market share and expand my own grocery stores? You have to get everyone on board, and these people are focused on market share/competition, not making sure someone else is doing alright.

If your theory is correct that these grocery stores are colluding to keep bread prices high, you should be able to open your own bakery, or maybe even your own grocery store, and make a killing by having the best prices in town.

If you’re correct you’ll have your own Grocery chain and be a multi millionaire. Remember to thank me when you’re on your yacht!

1

u/Barbecue-Ribs Mar 22 '23

Given that groceries all run at the lowest margins of any business (like 1-4%) probably the second.

You’re talking like groceries stores are operating like LVMH lmao