I'll Feel Less Safeway.

In 2013 the Sobeys grocery chain acquired Safeway's Canadian stores.  I'm sure I was not the only one surprised when instead of rebranding them all Sobeys kept a large percentage in operation as Safeways.  (23 stores had to be sold off as part of the merger agreement.)  But now we are going to see a rebranding of some.  In Saskatoon's case 3 of the existing Safeways will be converted to the Sobey's run FreshCo branding.  FreshCo is the Sobeys equivalent of the Loblaw budget No Frills stores.  Sobeys says FreshCo stores will replace "underperforming" Safeway stores, with construction taking place in Saskatoon early next year.

The 3 stores to be converted in Saskatoon are at Market Mall, Confederation Mall, and on 33rd Street.  I only go into the 33rd Street store once in a blue moon, but I'm not surprised about the Confederation Mall store, since that mall as a whole underperforms.  Market Mall has the problem that its located in the middle of what is supposedly the oldest per capita population in Canada, the area having a large number of older residents in seniors housing.  Some of them buy little or no groceries, so it's hard to see how lower prices will change that.  One thing all three stores share is that they're smaller than the other two Safeway stores in Saskatoon, making them more suitable for a budget branding.

As for the other two Safeway stores the only thing I can imagine happening to them in the foreseeable future would be a conversion to the Sobeys branding.  The Mall at Lawson Heights store is brand new, having replaced the old Safeway space in the same mall last year, while the McOrmond Road Safeway is only a few years old.  The Lawson Safeway would need little more than some new paint and signs to become a Sobeys, as it has pretty much the same layout as recently built Sobeys stores.  The McOrmond store would need more work, unless of course they just changed the appearance.

First Down.

Canadian grocery chain Sobeys acquired Safeway's Canadian assets last year.  Back in October it was announced they would be closing a number of stores as part of the approval process from the Competition Bureau..  It was revealed that the store at the Centre at Circle and 8th, on 8th Street,would be one of those stores.  However it wasn't hard to suspect the other Safeway on 8th Street, at Cumberland Square, might also be closing, given that it's directly across the street from a Sobeys.

Those suspicions were correct. Cumberland Safeway will be closing April 5, when the current lease runs out. John Graham of Sobeys even mentions one of the factors I thought might be a problem, the costs of renovation.  Supposedly no one will lose their jobs, but given that the Circle Centre Safeway will be sold  it seems there will be more employees than positions in their Saskatoon holdings.

Concorde Properties owns Cumberland Square.  Their rep, Kyle Chatterson, states there is interest in the soon to be empty retail space.  One possible tenant that immediately came to mind to me is the Dollar Tree discount store chain, which has entered the Saskatoon market over the last year.   They have two stores on Saskatoon's west side, so an east side store on one of Saskatoon's primary business streets would be an obvious move.

When the other Safeway on 8th Street closes 2 locations will remain on Saskatoon's east side, the Market Mall and MoOrmond Drive locations.  Of course we don't know if they will stay under the Safeway name, so it's possible the Cumberland closure is the beginning of the end for a long familiar name in Saskatoon.

Odd Choice.

Safeway has long been a fixture on the Canadian retail landscape.  But its future became unclear when rival grocer Sobeys announced its acquisition of the chain earlier this year.  The federal Competition Bureau has now approved the 5.8 billion dollar sale, but one of the conditions is that Sobeys will have to sell off some of its assets in Western Canada, including both Safeway stores and its existing Sobeys, IGA, and Price Chopper stores.

Yesterday Sobeys announced the 23 stores it will need to sell off.  The single location to be sold in Saskatoon is the Safeway located in the Centre at Circle and  8th shopping plaza.  It's a decision that's sure to leave many Saskatoon residents with questions.  That location is in one of Saskatoon's major shopping centres, and does lots of business.  It has been renovated in the past few years, and also includes a gas station that just opened last year.  If there was a Saskatoon Safeway that seemed doomed to disappear it was the other 8th Street location, located in the Cumberland Square Shopping Mall.  That store is small by modern Safeway standards, has no room to expand, and needs some reno work.  More importantly it is located immediately across the street from a Sobeys.  Of course it is possible this store will simply be closed by its new owners.

Who might buy Centre Mall Safeway?  There wouldn't seem to be any obvious candidates at the moment. Canadian grocery retailer Loblaws already operates a Real Canadian Superstore grocery on 8th Street. Perhaps a chain not already operating in Saskatoon would be interested, although operating a single store might not be the most efficient way to go.

Even with the sales Sobeys will see its holdings increase by 190 stores.  Whether any of these will stay as Safeway stores, or will be rebranded as Sobeys or some other name, it still unclear at the moment.

Loblaws itself is in the middle of buying the Shoppers Drug Mart chain.  The deal is currently under Competition Bureau evaluation.  And it's a big deal, worth 12.4 billion dollars in cash and stock, which should be an indication of how major a brand Shoppers is in Canada.  Besides health care products Shoppers sells various other products, including a considerable amount of food products, which presumably means we'll see Loblaws brands appear on Shoppers shelves if the sale goes through.