While Federated Co-operatives Limited announced record sales for 2012 today, delegates at its annual meeting in Saskatoon were warned of increasing pressure from large competitors in key business sectors.
That covers large competitors like Walmart and Target in the retail food sector and Glencore and Agrium in the crop supply business.
“Recent changes to the marketing of grain in Canada has opened up a whole new wave of international competitors in our market,” FCL chief executive officer Scott Banda told the audience.
“These competitors are pursuing grain in Canada, but they bring with them a whole number of other business lines with them that compete directly with us.”
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FCL recorded sales of $8.86 billion in 2012, up seven percent from 2011, representing growth across its energy, food, home and building supplies, crop supplies and feed businesses.
“The marketplace is changing and to compete we need to keep improving. We know that the status quo is not an option,” said Banda, highlighting a marketing and branding initiative for the upcoming year.
The organization has 234 retail members across Western Canada, down from last year following several amalgamations. FCL’s annual report shows that four other members — Burnaby, Kinasao, Magrath and Orion were removed from membership.
“Amalgamations are happening in a whole variety of ways,” said Vic Huard, FCL’s vice-president of corporate affairs in an interview, where he highlighted the merger of large co-ops in Red Deer and Innisfail, Alta.
Further amalgamations are likely to occur, he said.
“We know that there are boards out there talking. We encourage them to talk all the time ….” said Huard.
“We don’t control that. It has to happen at the retail level. People in the communities have to make these initiatives work.
