Metro's La Flèche named Outstanding CEO of the Year
Executive praised for transforming `the very nature of the customer experience'
It may be unfair, but Metro Inc. is often overlooked by the English-speaking press since its footprint is concentrated in Quebec and Ontario, while its two primary homegrown competitors — Loblaw Cos. Inc. and Empire Co. Ltd. — are national, but it's been as busy changing as any company.
Since Eric La Flèche became chief executive 12 years ago, the Montreal-based grocer has grown both organically and by acquisition to now include 950 food stores, under several banners including Metro, Metro Plus, Super C and Food Basics, plus around 650 drugstores, two-thirds of which are from its most recent major — and most important — acquisition, Jean Coutu Group (PJC) Inc. in 2018 for $4.5 billion.
Managing all that is a tall order and a big reason why La Flèche has been named Canada's Outstanding CEO of the Year for 2020, as presented by Bennett Jones LLP, Caldwell Partners International Inc., National Post and BNN Bloomberg.
“In a market filled with strong and sophisticated competitors, La Flèche has guided Metro to a position of impressive strength and customer loyalty, doubling its asset base in the past five years, employing some 90,000 Canadians, and increasing its revenues to over $16 billion annually,” said John Wallace, chief executive of Caldwell Partners, founding partner of Canada's Outstanding CEO of the Year. “La Flèche's passion for understanding Metro's customers — for analyzing the markets and acting upon the insights — has transformed the very nature of the customer experience.”
Metro has long had a history of making big acquisitions, which has fuelled the company named after Montreal's rapid transit system into a retail giant.
There were the 48 stores from Steinberg, once the largest supermarket chain in Quebec in 1992, a year after La Flèche joined the company's real estate department, three years after earning an MBA from Harvard Business School.
It also acquired Loeb from Loblaw in 1999, which gave Metro its first footprint in Ontario, a huge $1.7-billion deal for A&P Canada in 2005 (beating out Empire), as well as smaller ones including 15 supermarkets from Les Supermarchés GP Inc. in 2009 and a majority stake — 55 per cent — in ethnic food retailer Adonis Marché (now owned fully since 2017) in 2011.
That none of the more recent deals has tripped the company up might very well be due to the care and attention La Flèche, who seems fond of saying “retail is detail,” and his team have put into them.
That attention to detail is even more paramount now, since the grocery industry has been in the news a lot this year, likely because the big three grocers have been among the few businesses to do well during the pandemic.
Of course, that success hasn't come easily.
“Everyone really went above and beyond the call of duty to provide the essential services of food and pharmacy and I could not be prouder to lead this team than I was during the crisis,” La Flèche explained. “In fact, our whole industry — retailers, manufacturers, distributors — did a great job overall.
On the surface, grocery is pretty simple: People need food and most of us have to buy it from somewhere. But that belies how complex the industry has become. Initially slow to adopt e-commerce, the grocers are now all-in, accelerating their investments and growth projections simultaneously.
Add in other in-store technologies such as self-checkouts and electronic labels as well as new back-end infrastructure such as so-called dark stores and bigger, more efficient warehouses, plus all the political attention on pay rates and codes of conduct, and what was once a fairly sleepy business has become one of the most dynamic.
La Flèche has navigated Metro through the political turmoil and those investments, which he points out have required a lot of effort from staff in terms of change management and adapting to new processes and systems.
But more investments are on the books, including a new $400-million fresh-and-frozen facility in Montreal that should open in 2023.
Through it all, the company has paid an increasing dividend for 25plus years.
“Part of our success with investors is that we're a steady performer: We deliver decent growth in our earnings, we grow our dividend every year, we buy back some stock every year,” La Flèche said. “Those three elements have delivered good value for shareholders over the long term and we're very proud of that.”
La Flèche has guided Metro to a position of impressive strength and customer loyalty, doubling its asset base in the past five years.