Dollarama signs up with UGI

Grocery buying group UGI is adding another member.

Dollarama, the country’s largest dollar-store chain, will join Jan 1.

In a letter sent to suppliers and the buying group’s members, UGI president Denis Gendron said the addition of Dollarama “confirms the determination of the UGI board members to continue to grow.”

READ: Dollarama, Canada's hottest retailer is loonie

“We are confident that there will be opportunities in the future to add new members,” he added.

Dollarama’s board of directors must still approve joining UGI. It meets next Wednesday to decide.

Dollarama posted sales of $1.86 billion in 2013, a 16 per cent increase from the previous year.

About 37 per cent, or $687 million, of Dollarama's sales last year were from consumable products.

The Montreal-based chain, founded in 1992, now operates more than 900 stores in all ten provinces.

Toronto-based UGI includes some of Canada’s largest supermarkets, including Metro, Overwaitea Food Group, H.Y. Louie and Longo’s.

Last year UGI suffered a setback when one of its largest members, Canada Safeway, exited the group after it was bought by Sobeys. Safeway’s sales in Canada totaled some $6.7 in 2012.

But in recent months UGI has added several key members. In June, convenience-store giant Couche-Tard joined, as did Core-Mark, a distributor of tobacco products, candy, snacks, groceries and fresh food.

A month earlier, Quality Foods, an independent grocer with 12 stores on Vancouver Island joined UGI.

And last month, Freson Bros. the 15-store Alberta supermarket chain signed on.

VIEW: See inside Quality Foods' Victoria store

UGI says its membership now totals more than $30 billion in retail sales with a 21% all-channel market share.