On January 8, 2018, grocery giant Loblaw offered a $25 gift card to any Canadian who had purchased bread from one of its stores in recent years. As many as six million customers across the country would receive one, according to a company estimate—a move that was expected to cost between $75 million and $150 million. This was seen as a PR scramble after the company admitted involvement in a bread price fixing scheme amid a Competition Bureau criminal probe into whether several large retailers and suppliers were coordinating to increase the price of bread. According to court documents unsealed in a class-action lawsuit, the bureau alleged that, along with grocery retailers including Sobeys and Metro and bread suppliers, Loblaw had artificially inflated the price of bread by at least $1.50 for over a decade. Each price hike would take the same pattern, which became known as the “7/10 convention”: the supplier would raise the price by 7 cents, and then the stores would raise it by 10 cents for the consumer. On and on until the price of bread was vastly inflated.
Immediately following the news of the bread price fixing, public trust in Loblaw plummeted 10 percent, CBC News reported. Today, the grocery industry is facing consumer frustration and concern, due in large part to newly increased prices at grocery stores. This past year, many Canadians have scrambled to adjust their grocery budgets because of rising inflation. According to Statistics Canada, in July, the price of eggs rose nearly 16 percent year over year, of fresh fruit by nearly 12 percent, and that of bakery products by over 13 percent.
