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Calgary Co-op

Part of the City, Serving the City

Ken Keelor, CEO of Calgary Co-op. Photo by Ewan Photo Video.

When it comes to buying groceries, Calgarians have a lot of choice. From big-box American chains to local farmers markets, an ever-expanding multitude of entities vies for a share of the local market. Each uses its own tactics to sway shoppers who, with their mighty purchasing power, ultimately decide who wins and loses.

One decisive winner – for the past 62 years – is Calgary Co-op. Formed in 1956 by local farmers, ranchers and producers, the purpose of Co-op was to pool resources in order to buy cheaper. Its first store, located in downtown Calgary, gained approximately 1,000 members in the first year.

Fast forward to today, Calgary Co-op is one of the largest retail co-operatives in North America, with $1.2 billion in annual sales and over 460,000 members. Its locations in Calgary and the surrounding communities of Airdrie, Cochrane, High River, Okotoks and Strathmore include 24 food centres with pharmacies, 28 wine, spirits and beer locations, 30 gas bars, 24 car washes, five commercial card locks and three Home Health Care (HHC) Centres. Calgary Co-op is your local grocery store (since childhood for many), and much, much more.

The basis for this longevity? “We’re founded upon service,” says Ken Keelor, CEO of Calgary Co-op. “Some people might call it old fashioned that we help you carry your groceries out or that we offer you full-service gas at self-service prices, but in a world where a lot of businesses are reducing the amount of service you get, Calgary Co-op has always been about service in every one of our lines of business.”

Keelor knows much about the grocery business, having spent most of his career in it. Originally from India, he moved to Canada in 1995 with a bachelor’s degree in physics and an MBA in marketing. After six years with Save-On-Foods in B.C., he moved to Toronto where he spent 10 years with Sobeys and three years with Rexall Pharmacies. He returned to Sobeys after it purchased Safeway, then joined Co-op as CEO in November of 2014.

His pride in Co-op’s level of service is palpable. He credits its people – Co-op’s secret ingredient, he says – with this service. “They’re outstanding,” he raves, “service is in their DNA.” Not only instrumental in day-to-day operations, these 3,850 employees also help determine Co-op’s future at twice yearly sessions conducted by store managers and attended in batches, so that all employees can provide input for Co-op’s strategy.

That Co-op’s team members are local community members is another key part of its success. “We’re created by the local communities for the local communities,” Keelor explains. “We are intimately and always will be intimately familiar with Calgarians because our team lives in these communities. We tend to understand our customer better than anybody else. When Calgary’s not doing well, we know.”

Take, for example, the past three years of recession. “Because we’re so local, we were able to see that there was some challenge ahead so we altered how we focused on our customers,” Keelor explains. “They wanted more value offerings in our stores. So, while we didn’t pull back on our services, we certainly put a dose of value into our merchandising in the stores, into the product mix in our flyers and our promotional activities.” As a result, Co-op did not make significant cuts to its workforce. “We worked through those times as a team.”

Co-op’s team members are fiercely loyal to their employer who, for the second year in a row, was named to Alberta’s Top 70 employers. “We had our service awards yesterday and had a 45-year employee,” Keelor marvels. “We had 220 employees who had 10 years each. We have one gentleman who will celebrate 50 years next year. It’s very rich.”

Today, Keelor says, Co-op is doing well given the state of the economy. “And we’re quite happy in terms of seeds we have planted for the future.” Those seeds include five new gas bars, more grocery and liquor stores, redevelopment of the Brentwood, Dalhousie, North Hill and Oakridge locations, a future cannabis business and expansion of e-commerce options.

Co-op’s grocery business, which occupies approximately 15 per cent of the Calgary market, remains focused on its key pillars. “We’re known for quality, freshness, service, local and community,” says Keelor. “We’re not known for being the cheapest price in the city, but we are known for being the greatest service-value in the city.”

Co-op customers, he continues, are more discerning, desiring local, fresh and organic products.

To meet these desires, Co-op carries hundreds of local products. Recently, it started carrying only Alberta beef. “All of our fresh beef is harvested, produced and packaged in Brooks,” Keelor says proudly. “And the response from our members has been almost immediate – a huge uptick in purchases of beef.” Other local products include Paradise Hill Farm tomatoes and the widest selection (outside of Spolumbo’s store) of Spolumbo’s sausages in Calgary.

Every year, Co-op holds a meet-the-producers event, recently rebranded as “Fresh from the West.” Taking place over four weekends in July and August, local producers and their products are showcased in stores. “It’s kind of a thrill to buy a jam when the producer of the jam is standing right there,” says Keelor.

Freshness is another attribute Co-op is loved for. “Our produce is fresh because our team puts so much TLC into it,” Keelor explains. “But another reason is it’s an upward spiral – our member/owners purchase it faster and we replenish it with other fresh stuff.” He highlights Co-op’s cheese island, with hundreds of varieties of cheeses and highly-knowledgeable team members, as well as the bakery. “I’ve never seen bakery people as passionate as they are at Calgary Co-op.”

Environmental sustainability is a priority for Calgary Co-op, which has undertaken several initiatives in its grocery stores including new coffin freezers with sliding doors, recycling programs and combined heating and power (CHP) units at its Shawnessy and West Springs locations. “It uses the waste from natural gas to heat and power the store,” Keelor explains, “and allows a 20-40 per cent reduction in usage of the grid.”

Under Keelor’s direction, Co-op pharmacies have received a recent update. New blue graphics replaced old hospital-looking white ones, new software and cash registers were installed and more comfortable chairs were added. “We’ve made it more of an oasis,” he says. “Where you feel good and we look after you.”

The Natural Choice department – adjacent to the pharmacies and where natural foods and supplements can be found – is growing. Natural Choice advisers are available in store offering advice to customers.

Co-op’s wine, spirit and beer business is also expanding, and Keelor sees much potential. “We should have many more liquor stores than we do,” he admits. “We’ve grown that business with great care and it’s been very exciting. At its heart is our wide assortment and very knowledgeable and passionate liquor employees.”

Promotional activities, including the twice-yearly “Grape Escape” where many suppliers, including private labels, are highlighted to customers, are important.

The World of Whisky, Co-op’s newest concept liquor store – located downtown in the +15 next to the Calgary Petroleum Club – has been a huge success since opening last year. “They have 700 varieties of scotches and whisky,” Keelor offers. “But it’s really the two employees in that store who make the difference. They can tell you the origins; how to drink them. It’s a very small store, but wow, for World of Whisky, it is amazing!”

Acquired some years ago, Co-op’s HHC line of business is very healthy and in fact has continued to grow every year of the recession. “It’s our most recession-proof business because it’s not about impulse purchases,” Keelor explains. “It’s people with genuine needs who want to trust who they buy from.”

A co-operative at its core (membership costs $1), Calgary Co-op members earn a rebate when they shop at any of the businesses. In February each year, the rebate is sent out in the form of shares and cheques. The total amount rebated has ranged between $31 million and $35 million the last few years. “The longer and more you shop, the larger the cheque,” Keelor smiles.

It is member/owners who make up Co-op’s nine board of directors. “If you spend $3,600 in a year you are eligible to stand for election to our board,” says Keelor. “We’re tightly governed by Calgarians and I experience it every day.” For example, he’s often challenged on how a promising business decision is also good for the community.

“We don’t exist just because we have a business but also because we have a social purpose,” he reiterates. “And our social purpose is to serve Calgarians in a responsible, trustworthy way that contributes to Calgary and the surrounding cities.”

Indeed, Calgary Co-op contributes generously to many charitable causes. The Co-op Charity Golf Classic raises between $290,000 and $300,000 every year for organizations such as the YWCA and Meals on Wheels. “We have lots of supplier participation and all of our store managers come out,” Keelor says.

Another initiative, which occurred this past February, encouraged members to spend their rebate cheques in Co-op stores in support of the Calgary Women’s Emergency Shelter. “If you spent your cheque with us we would contribute our own funds to the women’s shelter,” Keelor explains. “And if you wanted to donate, we would match your donation too.”

Other initiatives include Stuff a Bus for the food bank, Stampede breakfasts throughout the city, Seniors’ Day at Heritage Park and financial support for local community projects.

With an eye to the future, Keelor expects much more competition for Co-op, as well as plenty of opportunity to excel at what it does best. “More and more customers are becoming discerning, whereas in the past it was all about price and you could get by if you were somewhere in the middle. Now we think grocers in the middle will perish. You have to be acutely about price or acutely about the discerning customer who knows what they want.” For Co-op, this will mean offering traceable products that can be purchased through multi-channels (in store or online, for example).

The redeveloped stores (none of which will close during rebuilding) will be better integrated with local streetscapes, featuring more natural lighting, brighter colours, open and community spaces, and rooftop gardens.

Co-op’s cannabis business, still in the early stages, provides another opportunity. “A significant portion of our members are interested in buying cannabis from a safe, trusted and reliable retailer – which we are. So, we take immense pride in being able to build a brand-new business.”

With a social purpose and a solid business, Calgary Co-op’s place in the city is sure. By remaining committed to its original values while also building on them, Co-op has not only survived 62 years, it has thrived in them. It remains Calgary’s grocery store.