Company response: North West Company

The North West Company is earning moderate profits on its business operations. On average, North West earns 4 cents of profit on every dollar of sales, with the vast majority of the retail price, 96 cents on the dollar represented by operating costs of the business.  These costs include the cost of the product (60% on average), freight, employee wages, facilities, utilities, warehousing and distribution, support costs, the majority of which are higher in the north than the south. 

The assertion by some that North West is contributing to higher food prices in the North is inaccurate.  In fact the 2018 Government of Nunavut Food Price Survey highlights that the highest food basket in Nunavut is in the community of Kugaaruk, a community where we do not operate.  In fact the average food basket in the 21 communities we operate in Nunavut was $170.25 compared to $189.52 in the 4 communities we do not operate or 11.3% less.   We can help bring prices down through our purchasing power, negotiating leverage and other operating efficiencies.

We acknowledge that there is room for improvement and we continue to work with other stakeholders in the region to address the important issue of income security that underlies food and other living cost issues that impact people in the north. In this regard it is important to understand the significant cost differences between remote and urban Canada and the fact that these costs are, unfairly, not offset by income support programs. Construction, repairs, energy, product waste, housing, specialized management positions, transportation and local services are many times more expensive in the far north and must be considered as part of real, sustainable income security solutions.