Walmart cuts prices on staples in Western Canada

Fri Mar 12, 2010 9:38am EST
 
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TORONTO (Reuters) - Walmart Canada said on Friday that it plans to cut prices on staple goods in Western Canada as it ramps up a price war in that hotly contested area.

The company, a subsidiary of U.S.-based Wal-Mart Stores Inc WMT.N WMT.N, said the items include everything from milk and bread to eggs and butter.

The move comes as competitors such as Loblaw Cos Ltd L.TO, the country's biggest grocer, and Sobey's, a division of Empire Co Ltd EMPa.TO, continue to expand in that area.

Loblaw has opened a number of its discount No-Frills stores over the past few years, which offer low prices on all their goods.

Walmart, which has 317 stores across the country, has also opened a number of its larger-format supercenters in western Canada, which offer groceries and general merchandise under one roof.

"This is probably a reaction to the increased discount competition that they (Walmart) are facing," Bill Chisholm, a retail analyst at MacDougall, MacDougall and MacTier, in Toronto, said of Walmart's latest move.

Last month, Walmart also said it planned to spend C$115 million ($113.1 million) to open a refrigerated distribution center in Alberta later this year, which would serve a large part of Western Canada.

($1=$1.02 Canadian)

(Reporting by Scott Anderson, editing by Gerald E. McCormick)