Metro Inc. is investing more into its distribution power, with plans to put upwards of $400 million into its Ontario distribution network over the next six years. The step is a big one as the chain already entered a $3.6 billion deal to acquire Jean Coutu this month, then announced plans to sell off $1.2 billion in Couche-Tard Holdings to fund the buy-out.
"This investment will enable Metro to continue its growth and expansion in the Ontario market," commented Eric R. La Flèche, President and Chief Executive Officer. "With a new and modernized supply chain infrastructure, we will be even more responsive to the needs of our customers."
The investment strategy, which includes building a new fresh distribution facility and a new frozen distribution facility, will modernize its Toronto operations between 2018 and 2023. Both are planned to leverage technological improvements, according to a press release, including automation.
"The new distribution centers will provide improved product assortment and selection accuracy as well as more flexibility which will allow us to improve service to our store network and customers," said Executive Vice President and Metro Ontario Division Head Carmen Fortino. "In addition, they will feature state-of-the-art technology to enhance efficiency."
The retailer currently operates six different distribution centers in Ontario–four in Toronto and two in Ottawa.
Metro said that it anticipates the decision to modernize and automate a part of its distribution network will result in losing approximately 180 full-time and 100 part-time positions starting in 2021, adding that it acknowledges the impact its decision will have on these employees and their families.
"Working with our employees and our union, we will provide those who will be impacted by this decision with a range of transition measures to support them throughout the process," said Fortino. "Fortunately, we have some time to plan the transition."
Metro operates over 600 food stores under several banners, employing more than 65,000 throughout Ontario and Québec.