Loblaw plans to pilot new value-based No Name grocery stores in Ontario.

Beginning in September 2024, three stores in Windsor, St. Catharines and Brockville will offer 20% savings on everyday grocery and household essentials by lowering operating costs and carrying only a targeted assortment of products.

“We are not working with an agency partner, and the stores will actually have very limited marketing (i.e. no flyers, etc.) in order to keep our costs – and therefore the prices – down,” a spokesperson for Loblaw tells strategy.

Loblaw president and CEO Per Bank says the motivator is to provide food and essential household items across a limited range of national brands, as well as No Name brand products at the lowest possible price.

“Since food inflation took off globally, we have been laser-focused on doing what we can to keep prices lower for customers, including opening more discount food locations in more parts of the country,” Bank says. “This new test concept allows us to pass on lower prices to our customers – it’s a completely different and simplified shopping experience.”

The No Name stores are reducing operating costs in other ways, including smaller assortment (a limited selection of 1,300 SKUs), shorter operating hours and no refrigeration.

Melanie Singh, president of Loblaw’s hard discount division, said many of the items sold in No Name stores will be top-selling pantry and household staples. “This is a test and learn project, and we’re planning to listen and adjust quickly.”

In May, Loblaw agreed to a revised Grocery Code of Conduct, which recently added Walmart and Costco as signatories.