Conversion from Provigo to Maxi | “Merchants are stressed”

The upcoming conversion of nearly 20 Provigo stores to Maxi is worrying some franchisees who fear they will be next on the list of stores transformed into blue and yellow discount stores, learned The Press.

More brand changes are on the way. By the end of the year, a total of 30 Provigo will have been converted. At a time when consumers are on the hunt for bargains, will inflation get the better of Provigo? With the growing popularity of discount brands like Maxi, Provigo could well become a thing of the past, according to Jacques Nantel, professor and retail specialist at HEC Montréal.

Currently, in Quebec, there are 66 Provigo stores and 128 Maxi. “With less than 100 stores across Quebec, unfortunately, I would say that it is a banner that is in serious danger of disappearing,” says Mr. Nantel, who remembers the time when the brand had nearly 400 stores.

“Loblaw – which manages the two brands – has already got the better of Provigo,” he says bluntly. It’s a banner the company has had such a hard time with. There’s not much she hasn’t done with that banner since she acquired it. Provigo is a network of affiliated retailers, and Loblaw isn’t really used to dealing with that, he adds. It is not in his habits. The Maxi supermarkets are indeed managed by the company.

So, according to Mr. Nantel, franchisees who still display the Provigo name on their facade have reason to be concerned. Some fear indeed to swell the ranks of Maxi stores, confirmed to The Press sources familiar with the matter. As they are not authorized to speak publicly, they prefer to conceal their identity.

“It is sure that the merchants are stressed. Loblaw aligns itself with a concept of “Provigo plus”, a very high-end market like in L’Île-des-Sœurs and Kirkland.”

Another source suggests that surviving Provigo merchants have an idea of ​​the number of grocery stores that will come under the blue and yellow banner, but that they do not yet have an idea of ​​the complete list of those that will. will be converted, which contributes to the feeling of insecurity.

Recently, Loblaw announced that the stores in Rivière-du-Loup, Saint-Pascal, Baie-Comeau and Saguenay, in particular, will become Maxis. In some of these cities, the discount brand already has one or even two supermarkets.

The Press tried in vain to contact owners whose Provigo store will be transformed into a Maxi. Some have suggested that we contact the communications department of the parent company. As for the still existing Provigos, the owners we called also shut themselves up in silence.

From owner to employee

Thus, those whose store is converted also change hats: they go from owner to employee, since Maxi is entirely under the responsibility of Loblaw. But these merchants don’t have to worry about their future, assures Johanne Héroux, Senior Director, Corporate Affairs and Corporate Communications.

“They all have the possibility of remaining within the company, the same thing for their employees, she specifies. There is nothing to worry about for their future. So far, it’s going very well. »

Provigo is not wiped off the map

M^me Héroux ensures in the wake that the sign will not disappear from the landscape and “that it remains very much alive”. The proof, she says, is that three stores will be the subject of several million investments and will adopt the brand new concept of Provigo Le Marché – like the grocery stores in Kirkland and L’Île-des-Sœurs. Niche products and a varied ready-to-eat offer characterize these supermarkets.

Despite everything, Loblaw makes no secret of its intentions to eventually convert other Provigos to Maxis. “In the immediate future, there should not be several others. In the more distant future, the exercise is not over, ”recognizes however M^me Heroux.

In an inflationary environment where consumers are looking for bargains, Loblaw notes that Maxi’s popularity is growing. “In the past 20 years, it has never happened that we have opened so many stores,” said Patrick Blanchette, vice-president, operations, of Maxi, during a telephone interview in December.

Sale of Provigo stores suspended

In addition, while Loblaw had announced in the fall of 2020 that it was selling 25 Provigo belonging to it at a price of $50,000, the company has now decided to “suspend its program”. The objective was to franchise the entire network. Over 1000 applications were received.

Without revealing the exact number, M^me Héroux indicates that a “good part” has been sold. “We suspended the program because of this analysis that we are doing to optimize the network,” she explains.