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In Quebec like elsewhere, the 1960s give rise to
far-reaching changes. A booming economy fosters the implementation
of major social, institutional and economic reforms. Through these
changes, Quebec becomes a true welfare state. Despite a significant
demographic slowdown, its population grows to 6,000,000 by 1971.
More than ever, Montreal's neighbourhoods has a distinctly
cosmopolitan flavour. With a better standard of living, the more
educated baby boomers and the emergence of different values, the
face of Quebec is changing.
Following a brief downturn, economic activity recovers in 1971 with the building of the Olympic Stadium and the huge James Bay project which turns Northern Quebec into the world's largest construction site. Despite high inflation, the changes initiated during the Quiet Revolution lead to a significant improvement in Quebecers' standard of living. The growth of retail sales in the province is nothing short of spectacular, jumping from $4.2 to $14.3 billion between 1960 and 1976. Accounting for approximately one-third of these sales, the food industry is a primary beneficiary of this increase.
However, fierce competition in this industry prompts major players to reposition themselves to retain their respective market share. The start of a price war and the proliferation of shopping centres are just two of the factors with which the management of Les Marchés d'Aliments Metro-Lasalle Ltée has to contend. Using original marketing strategies, the Board of Directors adopts a daring and successful approach to the Company's business. In fact, this decade can be summed up in two key words: modernization and partnership.
The Boeuf Mérite Ltée plant is
inaugurated on July 2, 1968. The result of a partnership between
Les Marchés d'Aliments Metro-Lasalle Ltée and
Épiceries Richelieu Limitée, the new company uses two
letters from each name to form the acronym Mérite
(MÉ-RI-te). To ensure its development, the two partners
invest thousands of dollars in state-of-the-art equipment. These
new facilities enable Boeuf Mérite Ltée to guarantee
the two groups' 500 members access to meat of the finest
quality.
The Boeuf Mérite plant is capable of handling over 1,000,000 pounds of meat a week without risk of spoilage. After arriving at the warehouse in refrigerated cars, beef carcasses are cut up and stored at controlled temperatures until delivery, which is also carried out by refrigerated trucks. The meat is never subjected to fluctuating temperatures since the cold chain is maintained until it reaches the grocer's counter.
In its first year, Boeuf Mérite Ltée records $45
million in sales. In 1972, a pork division (with a production
capacity of 1,000 hogs a week) and the first ham smoker are
added. This decision involves the expansion of the warehouse and an
investment of approximately $1 million. Problems with meat brokers
soon lead Boeuf Mérite's management to establish its own
brokerage firm and to buy directly from suppliers. Boeuf
Mérite Ltée rapidly becomes one of the Company's
flagship divisions as well as one of the leading meat distributor
in Quebec.
In the early 1970s, the executives of major chains go on the offensive. To gain market share, they put an end to the distribution of bonus stamps and start a lengthy price war. The battle is fierce and the stakes are high. But as Gérard Bélair points out in his book "Chronologie des épiciers en gros et des détaillants au Québec" (A chronology of Quebec wholesale and retail grocers), Quebec's groups of retail grocers play the game quite well, holding their own against chain stores.
To ward off the threat from major chains, Les
Marchés d'Aliments Metro-Lasalle Ltée mobilize and
manage to retaliate fairly quickly. The Company launches a huge
advertising campaign to promote its weekly "Prix magiques"
(discounts offered by members.) In addition, in the wake of its
recent 67,000-square-foot expansion, the Notre-Dame Street
warehouse offers a new advantage: Metro-Express. This self-serve
formula allows grocers and restaurant owners to rapidly obtain the
items they need.
Within months, Les Marchés d'Aliments Metro-Lasalle Ltée innovates again with the introduction of an extensive range of house-brand products, adding to the selection of Metro-brand canned vegetables available since 1964. Shelves in the members' stores carry 116 new staples (juice, facial tissue, pasta, etc.) bearing the Metro label. This initiative enhances the Company's visibility. Grocers, on the other hand, enjoy a higher return, while customers can buy these products at lower prices. The popularity of Metro-brand products is such that their number quickly grows to more than 300.
In 1972, the Company becomes Les Marchés
d'Aliments Metro Ltée. At that time, the first stores
featuring the supermarket concept start to appear. The following
year, the Company celebrates its 25th anniversary on the theme Le
progrès en marche. Members of the group have every reason to
rejoice since Les Marchés d'Aliments Metro Ltée now
ranks among the leaders of the Quebec food industry.
In 1973, Les Marchés d'Aliments Metro
Ltée has over 300 affiliated members and sales of nearly
$132 million. The Company, which has started out with just two
employees, now has a staff of 160 in its various divisions. In
operation since 1968, a modern computer centre is available to
analyze store operations, enabling grocers to manage their stores
more efficiently and enjoy substantial savings in the process. In
fact, the Company contributes to its members' success in a number
of ways: it provides advice and support, along with a wide range of
house-brand products and quality meats prepared by Boeuf
Mérite Ltée.
In January 1975, Marchés d'Aliments Metro
Ltée and Épiceries Richelieu Limitée join
forces once again, becoming equal partners in a new entity: Jardin
Mérite Ltée, a state-of-the-art centre equipped to
handle the distribution of fresh fruits and vegetables as well as
frozen products. This initiative is intended to allow grocers
to better meet consumer demands. Professional requirements, the
massive influx of women into the labour force and a greater concern
for fitness are also having an impact on consumer habits.
Prepared foods and multiple variations (regular, light, etc.) are in greater demand. With improved transportation and storage, a wide range of fruits and vegetables are available virtually year-round. Through Jardin Mérite Ltée, the two partners' customers have access to a wider selection of fresh fruits and vegetables and often have the opportunity to discover new products.
The success of Boeuf Mérite Ltée and
Jardin Mérite Ltée soon prompts executives of Les
Marchés d'Aliments Metro Ltée and Épiceries
Richelieu Limitée to combine their operations. This merger
leads to the appearance of Metro-Richelieu Inc. in 1976.
Épiceries Richelieu Limitée is founded in 1939, when management decides to adopt a structure that will increase its buying power. The entity grows rapidly, attracting many owners of small neighbourhood stores. In 1970, Épiceries Richelieu Limitée invites retailers with larger sales volumes to join a new banner: Supermarchés Sélect.
With this move, Metro-Richelieu Inc. becomes the No. 2 food retailing organization in Quebec. Now stronger than ever, the Company has some 520 stores operating under its various banners (Metro, Richelieu and Sélect), 625 employees and two warehouses. It also continues to manage and operate its two major subsidiaries, Boeuf Mérite Ltée and Jardin Mérite Ltée. This merger results in a substantial gain in market share and a significant increase in sales volume, which grows to nearly $345 million in 1977. This solid foundation provides the springboard that will propel Metro-Richelieu Inc. to new heights.
