Using Retail Merchandising as a Strategy to Survive Price Wars in an Era of Cost Cutting

Canadian households are reducing their spending which has led to an era of cost cutting and price wars at retail. Among the issues at play is the housing crises in many of the most populated urban cities in Canada (like Toronto and Vancouver), an increased overall cost of living, an increased cost of gasoline and an increased cost of home heating. These issues are leading Canadians to change the way they spend money and look for ways to find savings in their budgets.

One of primary ways in which Canadian families are trimming their budgets is the way they spend when grocery shopping, including what retailers they shop at. If you sell product at grocery stores, this blog is for you. Cost cutting has even led some brands into veritable price wars while vying for those coveted consumer dollars.

This is not a surprise, considering a number of new studies are proving what you may be feeling in your retail sales:

  • One survey (Caddle) indicates that in the next 12 months Canadians plan to alter their approach to grocery shopping, with a whopping 30.6% indicating they will explore different retailers to score better deals. In fact, the same survey revealed that, for Canadians, pricing and affordability are extremely important with over 77% prioritizing price in their shopping decisions.
  • The Canada Food Price Report is out and reports a 19% drop in overall grocery spending in the past four years.

So, we know price is a major factor and probably the most important one. But, if you can’t compete on price, you can compete by being strategic with your merchandising. We know that some retailers have their merchandising act together better than others, and you know which ones they are. You also know which of your competitors’ products are cheaper and fly off the shelves.

Here, the strategy would be two-fold and include:

  • A competitive analysis of those products across retailers nationally to measure the frequency and patterns of their product being found out of stock.
  • In those stores and areas, you will heave up not just on your merchandising but also on promotion. Perhaps you can’t win on price for an individual purchase, but you can win with a three for one promo.

The more consistent, available, and accessible your product is, the more it will be first chosen as the alternative and win customer brand loyalty, even if it is slightly more expensive than the competition. Above is just one way in which we would help a smaller brand compete in a price wars climate using data and strategy.

If you are interested in learning more about how you can become more competitive by putting retail merchandising to work for you, visit

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