Sobeys parent company Empire shutters Voilà grocery delivery in Alberta

Sobeys parent company Empire Co. Ltd. is closing its Voilà grocery delivery facilities in Alberta and pausing the online service's expansion in the Vancouver area as it failed to meet the grocer's financial expectations. 

The Stellarton, N.S.-based company said it will take a $750 million writedown in its fiscal third quarter because of the wind-down. 

It also expects the moves to deliver $95 million in annualized operating income in its fiscal 2027 year. 

"Empire's Alberta e-commerce operations have not met the company's financial expectations, largely due to the Alberta grocery e-commerce market's size and expansion being smaller than originally anticipated," the grocer said in a news release Wednesday afternoon. 

The company said its customer fulfilment centres in Calgary and Edmonton will wind down immediately. A previously announced pause on development plans for a Vancouver warehouse will remain in effect.

Voilà will continue to operate in Ontario and Quebec, which is growing steadily, the company said.

For its Western Canada online shoppers, the company is planning to offer same-day delivery services through its third-party partnerships. It announced a new partnership with delivery app DoorDash, which will begin rolling out in the coming months.

Chief executive Pierre St-Laurent says the move is a part of reshaping the e-commerce strategy as the grocer responds to changing customer needs and expectations.

"Customers in Ontario and Quebec love Voilà and, while difficult, the decisions we have made related to our (customer fulfilment centre) network in Western Canada will help ensure the long-term growth and profitability of our e-commerce business," he said in a statement.

Empire launched its online delivery platform in 2020.