“One woman emptied her cart and drove straight here”: This Toronto grocer sells some items for 50 per cent less than Loblaws

While the cost of groceries at stores like Loblaws continues to rise, one Toronto grocer has achieved the impossible: receiving actual praise for the price of their products. In early January, Raise the Root, a locally owned organic market in Leslieville with just two full-time employees, posted a sign that compared the cost of its vegetables, fruits, spices and canned goods with the prices of those same goods at Loblaws; it turns out that some of their products are as much as 50 per cent less expensive. When co-owner Angela Donnelly shared the comparisons on the store’s Instagram, it garnered hundreds of likes. We asked Donnelly about how she manages to keep things affordable and the importance of cheap food as millions of Canadians are turning to food banks.

Your recent price comparisons made waves on social media. Where did the idea come from? Five months ago, just out of curiosity, I started marking down which foods we sold for less than they cost at Loblaws. To my surprise, I quickly came up with ten items. So I put them in a list and posted them in the window for people walking to see. I’ve done the same exercise three times since then. Our most recent list was shockingly long: 23 of our items were cheaper. I posted that list on social media on January 10, and it received almost 500 likes and dozens of comments. Best of all, more customers started coming through our door. One woman said she’d come straight from Loblaws—she was shopping and got so discouraged by the store’s prices that she emptied her cart and drove here.

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What kind of items are cheaper at Raise The Root? Things like limes, leeks, kale, onions and ginger have at times been half the price of what they were selling for at Loblaws. Though I should say that not everything costs less here. Some things, like almond or oat beverages, salad greens and berries, are cheaper at Loblaws. I assume that bulk-buying allows them to charge less. We can’t always buy items in bulk—some of our vendors are too small, we don’t have the space to store huge quantities of one thing, and we can’t guarantee we’ll have enough shoppers to sell perishable items in time.

If you’re buying organic foods in relatively small batches, how is it that you’re out-pricing a company 100 times your size? I can’t know for sure. You would think that large grocery stores would come up with more competitive pricing, especially at a time when many Canadians are hurting for food and millions are relying on food banks. My optimistic answer is that, because we’re a small business, we can be somewhat flexible. Every time we receive an invoice from a vendor, we recalculate how much we need to profit on that particular item. Then we price accordingly. Sometimes, that means we can sell certain foods at a discount.

What factors into pricing an item? Pricing properly is one of the most challenging parts of the job. If we price items too high, we lose customers. If we price too low, we risk going out of business. At Raise the Root, we generally err on the side of pricing low because it keeps food affordable. We know times are tough. For example, we never make any money on milk. But everyone needs it, and we know that it brings people into the store, so we take the hit. We often set prices that make us just enough to pay our monthly rent, which is $4,000, plus salaries and wages for ourselves and our seven other staff members. The consequence is that we haven’t turned a profit since starting this business a decade ago.

Right, and I imagine inflation hasn’t helped. Are you feeling the pinch? Yes. We’re constantly redoing our price tags to account for suppliers increasing their prices. Just the other day, we raised the price of our bouillon cubes by 40 cents. It doesn’t seem like much, but it adds up. One of our loyal customers came in recently and left some items at the cash register because they were too expensive. The last year has been tough—my partner, J. J. Sheppard, and I stopped paying ourselves salaries last September. We’ve started supporting the store with our personal home equity line of credit. It’s scary. We have two kids, who are 11 and 14. This business is how we support our family. We’ve foregone birthday parties at Sky Zone and had to cancel some health insurance. That Instagram post does seem to have helped, though. We made $5,300 in one day last week—that’s the biggest daily earning we’ve had in the last 18 months.

Many people blame rising grocery prices at stores like Loblaws on corporate greed—especially since their profit margins have almost doubled in the last five years. What’s your take? I don’t know—inflation certainly plays a role. Prices are rising for everything, across the board. Operations like ours sometimes do have an edge because we can switch vendors or change prices on the fly without dealing with the bureaucracy of a big corporation. But I think it comes down to the fact that small shops and big chains have different goals. Loblaws wants to make a lot of money and drive up their stock prices. We want to support our family.

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What else is driving up grocery prices? Climate change is hampering food production around the world, and that scarcity is forcing farmers and suppliers to increase their prices. This is not a new phenomenon—a lot of people in the organic food business feel that food has been priced too low for decades and that North Americans expect to pay too little for the food they buy. But I do not blame people for wanting to spend less. Many of us are squeezed by housing costs and low wages.

Do customers ever get upset about your prices? Sometimes. But we just tell them that we are not price-gouging or spending our profit buying cottages. They can see that we work at the store every day. Those price increases help us make a living, and there shouldn’t be any shame in that. We also tell customers that there are still ways to eat inexpensively. For example, we hold older produce in our bargain basement and sell it at marked-down prices. If people are not too fussy and are willing to eat a beet instead of a cucumber, we can help them swap out ingredients too. That way, they can eat nutritiously and organically while keeping things affordable.

For those who might have heard of Raise the Root only now that it’s gone viral, what’s the origin story? I grew up in this industry. My parents had an organic food store. When J. J. and I moved from Parkdale to Leslieville in 2014, we realized there were no produce markets on the Queen East strip. We told ourselves: we have to get in on this before someone else does. So we opened Raise the Root at the corner of Queen and Jones. The hope was that people would flock to us because there were no other small organic food stores in the area.

Did they? It was more difficult to get off the ground than we thought. At first, some locals were afraid that our store would sell only super-expensive items. But people warmed up when they realized our organic produce was affordable. Still, our business has struggled. Sales went down as the pandemic put a strain on the economy. I worked part time as a freelance bookkeeper to make extra money. Last September, I was so afraid Raise the Root would not survive that I put my side hustle on hold and dedicated all my spare time to doubling down on social media.

Seems like it’s paying off. Should we expect more price comparison lists? That’s the plan. We are just asking people to give us a chance. We are a small business, we care about having good produce on the shelves and we want to help people save a bit of money.

This interview has been edited for length and clarity.