Shopping Cart | An unlikely connection between Lufa Farms and Walmart

If any company perfectly embodies the concept of commerce, it’s Walmart. The mega-company founded in Bentonville, United States of America, with more than 400 stores in Canada, has become a true symbol of mass commerce. Import at the lowest price, at any cost, that’s Walmart’s motto. Its logistics are so efficient that opening a store can sometimes lead to a deflationary effect on its immediate market, which completely contrasts with the values ​​of locality, terroir and simplicity.

In stark contrast, however, Lufa Farms, one of the largest urban farms and one of the largest operators of rooftop greenhouses in North America, has opened a fifth greenhouse on the roof of the Walmart in Market Central. Walmart. Seeing these two companies side by side, which is at first surprising and for some disturbing, brings together Lufa Farms, a symbol of local, natural production without synthetic pesticides in an urban environment, with a giant often accused of harming local commerce.

The 126,000-square-foot greenhouse, where cucumbers and peppers are grown, uses cutting-edge technology from the Netherlands that allows the company to produce 40% more efficiently. The goal is to produce more at lower costs while maintaining quality values ​​and local production to satisfy the approximately 68,000 subscribers the company already has.

Like any business, Lufa Farms aims to increase its turnover and expand its market. With now more than 560,000 square feet of greenhouses, Lufa Farms production capacity has reached an interesting level. The company is even considering selling its products to its occasional neighbor Walmart, cementing an unexpected alliance. But there is always something to prove for Lufa.

Ordering from Lufa Farm is child’s play: order online and receive your food within days. For three days after purchasing online, you can modify your order if your needs change. The manufacturer delivers everywhere, up to 250 kilometers from Montreal.

Inflation has certainly forced many shoppers to rethink their grocery budget and change their shopping habits. However, the food environment has developed significantly, from which the company could profit in the long term.

First, there is a growing desire among consumers to favor local products in order to reduce their negative impact on the environment. As price fluctuations and climate change disrupt the planet, localized production like the Montreal manufacturer has is beneficial.

Lufa’s prices are slightly higher than the cheaper products on the market, which makes sense given the niche, smaller nature of production compared to the vast fields of California or Arizona. But that is less and less.

It is important to note that the prices of all products have increased over the last four years, and especially the last two.

Fruit and vegetable prices have increased by an average of 32% in Canada over the past four years. It is impossible to know the exact price increase of Lufa Farms, but it is definitely not 32%. In fact, our preliminary reports on the public markets indicate that prices in these markets have increased by about 15% on average. In other words, the gap between traditional products and specialty products has narrowed in recent years.

A recent study published in Journal of Hunger and Environmental Nutrition this year shows that small producers can be an attractive option even for people on a tight budget. According to the study, prices were generally higher at small producers than at grocery stores, but there were exceptions.

Running a company like Lufa Farms, with around 600 employees and a market larger than Switzerland, is no easy task, but the current macroeconomic conditions could be favorable for him.

Finally, the synergy between the Montreal company and Walmart shows that coexistence between different business models is not only possible, but can also be fruitful.

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