Canada’s largest grocery retailer is restocking about half the products it may have overzealously removed from shelves in a “broad brush” sweep to remove products sitting on “valuable real estate” that weren’t selling.

The system used to remove about 10 per cent of products from stores as part of its renewal plan was not sophisticated enough to properly identify unpopular products, Galen G. Weston, executive chairman at Loblaw Companies Ltd. said at the company’s annual general meeting yesterday.

“We knew we’d get probably about half of it wrong, not necessarily across the country, but on an individual store (basis),” he explained to an employee who was confused after seeing some President’s Choice and No-name products return to the shelves.

“Then we’d have to go through the process based on the customer calling us or letting you know what they want and we’d bring back those five per cent of (products) that really matter to that store,” he added.

Weston said he is aware the process is disruptive, but added the company is working to implement a new information technology system that will provide merchants with better understanding about products — from ethnic foods to private labels — that matter to customers at individual stores.

“We’ll be able to make sure the assortments service your customers much better than we have done in the past.”

Loblaw has had years of difficulties in updating its supply chain and merchandise management as it moved to compete with Wal-Mart by offering a broader range of non-grocery items including furniture, clothing and consumer electronics.

The grocery chain operates across Canada under numerous banners including Loblaws, Real Canadian Superstore and No Frills.

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