Get the Goods on Us
As one of our customers or community stakeholders, you deserve to know the facts behind the food and products you purchase from us every day.
How do we operate? How do we set prices on our products? What are we doing to keep prices fair for people and communities across the North?
Below are answers to these questions and how we're working to make a difference. You trust us to provide the food and products you need. We're committed to earning and keeping that trust, every day.
The Goods on Our Profits
On average, across a normal basket of goods, we earn about 4 cents of profit on every dollar of sales. The rest (96 cents) are direct costs to us, including the cost of the wholesale, product, transportation and freight, employee wages, facilities, utilities, warehousing and distribution at northern rates.
The Goods on Our Prices
We don't contribute to high food prices in the North. In fact, we do just the opposite. According to the 2018 Government of Nunavut Food Price Survey, the highest food basket in Nunavut is in the community of Kugaaruk - a community with no North West store. In fact, the average food basket in the 21 communities we operate in Nunavut was $170.25 compared to $189.52 in the 4 communities where we have no operations. We help bring prices down through our purchasing power, negotiating leverage and other operating efficiencies.
The Goods on Our Costs
We operate in the same high-cost environment as our customers and communities. And, this contributes to the high cost of food. When compared to our southern neighbours, everything is more expensive in the North including rent, utilities, transportation, construction materials, and utilities. Take for example the costs of electricity which are $.48 kWh in Iqaluit versus $0.07 in Winnipeg. For us, it means paying over $1M in Iqaluit for electricity - 7 times more than any comparable market in the South. Construction costs are another example, which can run more than 2 to 3 times higher in the North than in the South. Depending on location, a 10,900 sq ft store in Nunavut can cost over $6 million - almost 3 times higher than a similar build in the south.
The Goods on Lowering Prices
We're one for the few retailers that are investing in the North to bring prices down. We’ve made significant investments in sealift and winter road warehouses to help drive down the costs of storing and transporting products and pass the savings onto you.
The Goods on Lack of Competition
There is increasing grocery competition in the north. We have a local competition of varying degrees in the majority of markets we serve, including from Arctic Co-operatives, La Fédération des Coopératives du Nouveau Québec, and a number of local, independent stores. We also compete with online retailers that have made no investments in the north. Also, many northerners shop when they head South. So northern shoppers do have options where, when and how they spend their grocery dollars.
The Goods on Income Insecurity
We're encouraged by the Federal Government’s recent increase in subsidies for the Nutrition North (NNC) program and realize that there is more to do. You've told us that basic income programs such as social assistance and child tax benefits need to be increased to reflect the inherently high living costs in remote communities. Income Assistance Rates are 41% amongst Nunavummiut – about 5 times the national average. We also know that people on social assistance are 6 times more likely to be food insecure regardless of where they live in Canada. Without serious consideration to income security, food insecurity rates will continue to be higher in remote communities than elsewhere in Canada.
The Goods on Nutrition North
While Nutrition North (NNC) has room for improvement, the program has been effective in decreasing in retail prices. Since its inception in 2011, NNC has helped reduce North West’s nutritious food prices by an average of 6.24% on Level 1 items tracked in our stores (October 2018) despite inflation of 14% over this same period. Customer savings have led to a 26% increase in healthy food consumption, delivering on the program's mandate to make healthy food options more affordable and accessible. These results were achieved because we passed along all subsidies, passed along the freight savings we negotiated, and voluntarily lowered margins on eligible items.
The Goods on Nutrition North Compliance
Independent audit results by Deloitte confirm our compliance with the Nutrition North Canada program. Our results have been posted to the NNC website.
The Goods on Community Support
Every year, North West supports hundreds of community events and causes – from cultural celebrations to sports teams through more than $1.5 million in donations and sponsorships and volunteer time from North West Company employees.
The Goods on Working at North West
We are the largest employer of Indigenous peoples in Northern Canada and Alaska. In Nunavut, we are also the largest private sector employer. These jobs can lead to careers within our company and provide an entry into the wage economy for people in our communities.
The Goods on Better Food Options
In September 2017, we introduced our Health Happy program and 300-800 "better nutrition" food items in Canada and Alaska. We launched the program with a commitment to make healthy food products as affordable as possible. Since then, we've seen 13.8 percent more of these items purchased in our Northern/NorthMart stores.
The Goods on Better Distribution
In June 2017, we acquired North Star Air to build the first all-cargo air service in Northern Canada. Our goal is to achieve a more efficient air supply chain to serve customers in 87 communities that are not accessible by all-weather road.