Metro expanding in-store tech amid labour crunch

CEO Eric La Flèche says self checkout and shelf labels offer cost savings for the grocer and makes jobs simpler for staff

Metro Inc. plans to roughly double the number of stores with self checkouts during its 2020 financial year as the industry contends with a tight labour market.

"It's a challenge," said CEO Eric La Flèche, during a conference call with analysts after the company released its fourth-quarter results.

"I suspect it's a challenge for everybody in retail and it's a challenge for us to staff stores."

In October, the unemployment rate in Quebec was 5% and 5.3% in Ontario, according to Statistics Canada. Both fell below the national rate of 5.5%.

Metro operates most of its food and pharmacy stores in Canada's two largest provinces along with some Jean Coutu locations in New Brunswick.

La Flèche said the company was managing through the problem so far but he noted at a certain point, if staff didn't show up or stores couldn't find people to fill vacancies, store conditions started to reflect that reality.

"That's why technology, like self checkout or shelf labels, helps in making the job simpler for our store people," he said.

More than 100 Metro stores already have self checkouts installed and the company plans to add the technology to another 100 locations this fiscal year, he said.

Currently, 37 stores have electronic shelf labels that don't require price tags to be updated manually, he said, and Metro is targeting to boost that number to close to 100 by the end of its 2020 financial year.

While the company is installing the self checkouts in an effort to improve customer experience, La Flèche said the technology and electronic shelf labels helped manage labour costs.

"If we manage our hours well ... we're seeing some labour savings as expected to provide the return on investments."

Labour savings vary by store, he added.

The comments came as the retailer ended its fiscal year with a 15.4% net earnings boost in the fourth quarter.

The Montreal-based company earned $167.4 million for the period ended Sept. 28, up from $145 million a year earlier.

Excluding one-time items, Metro earned $174 million in adjusted profits, compared with $161 million a year ago.

Revenues increased 3.3% to $3.86 billion, from $3.74 billion as food same-store sales climbed 4.1% and pharmacy same-store sale were up 3.4%.

For the full year, net earnings fell by more than half to $714.4 million from $1.72 billion following the sale of operations. Adjusted profits grew 26.3% to $731.6 million. That compared with $579.2 million in the 2018 fiscal year.

Revenues were $16.77 billion, up 16.6% from $14.38 billion or up 3.2% when excluding the Jean Coutu Group.

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