More big changes in store for Sobeys, says food distribution expert
The dean of Dalhousie University’s management faculty says the abrupt departure of Sobeys’ CEO is just the beginning of big changes for the company.
“What was fired is not necessarily one person, it was a vision and that vision is represented by more people than just Marc Poulin,” said Dr. Sylvain Charlebois, a food distribution and policy expert.
Empire Company Ltd., the parent company of Sobeys, announced Friday Poulin was leaving the company immediately.
At the end of June, Empire reported a loss of $ 942.6 million or $ 3.47 per diluted share for the fourth quarter, compared with a net profit of $ 55.4 million or 20 cents per share in last year’s fourth quarter.
Charlebois said it’s an indication the board was unhappy with the company’s big picture.
He said the drop in earnings was the result of the difficult takeover of Safeway in Western Canada.
“Marc Poulin was dealing with the perfect storm. Safeway and Sobeys were very different companies and they were struggling to create synergies between the two companies,” he said.
“Their challenge, of course, is the Alberta economy. Safeway was acquired to capture some of that growth out west, but we all know what’s going on there with the oil prices.”
Struggle to increase sales
Charlebois said there was no way to foresee the impact oil prices would have out west.
“At the time, no one would have been able to predict what actually happened to the economy since then,” he said.
Sobeys is the second largest grocery chain in Canada, behind Loblaws, with just over 1,500 stores and 125,000 employees.
CBC | Business News