Sobeys grocery stores has admitted to an enormous miscalculation which led to a nearly 12 percent drop in first quarter net earnings. Speaking with analysts the CEO of Sobeys parent firm Empire Co. Ltd. said the loss occurred because Sobeys did not understand how difficult it would be to integrate the Safeway operation into the Sobeys way of doing things. Empire purchased Safeway’s western Canadian chain from the American parent in 2013. Sobeys uses a sophisticated merchandise control system created by the German software giant SAP. The system keeps track of everything from prices and sales to best-before dates. But president Marc Poulin said the real-time pressures of the software were too much for Safeway employees. He did not elaborate. Were there delays at cash? Whatever, Sobeys and its Safeway add ons did much less business. Net cash dropped $14.3 million from the same quarter last year.
