Supply Chain Scanner - Week of June 1, 2025
Weekly blog by Emily Atkins
Hyper-local distribution reaching for the rooftops in Montreal
Hyper-local distribution is not a new trend, but it’s getting new life in Montreal as Walmart Canada and Lufa Farms are teaming up to grow produce on the roof of a Walmart store.
Hyper-local distribution is a concept that came to popularity a few years ago. It sets aside the giant, suburban distribution centre in favour of smaller inner-city hubs that can get products to customers more efficiently. They avoid traffic congestion, high ex-urban real estate prices and rising delivery costs.
In the case of Walmart and Lufa Farms, they are using existing real estate that has until now been unused – the roof of the Walmart store at 951 Rue du Marché Central. Lufa Farms has set up a greenhouse on that rooftop and will be selling the produce grown there in the Walmart below. It’s a first for both companies. Lufa has always distributed its products on its own until now, and this is the first time Walmart will sell produce from a rooftop greenhouse.
The benefits are clear. First, Walmart customers can buy tomatoes, cucumbers and bell peppers that were picked as little as an hour earlier. For the farm, it means not needing to purchase land or deal with transporting perishables, and for Walmart it not only looks good from the standpoint of cutting carbon emissions, but it also cuts logistics costs for those products. From a larger social perspective, the project will also help to cut down on food waste, which is largely caused by losses in transport.
"Rooftops are one of the most underused spaces in cities – and yet they're perfect for growing food," said Mohamed Hage, founder and CEO of Lufa Farms. "Walmart has a huge network of rooftops across the country, and by transforming just one of them into a greenhouse, we're showing what's possible: fresh, local vegetables grown sustainably and sold just downstairs, the same day they're harvested. This is how we can reimagine the future of food in cities."
Lufa operates on five principles of responsible agriculture: using no new land, recirculating water, conserving energy, reducing waste, and using biocontrols instead of synthetic pesticides. The company was founded in 2009 and built its first rooftop greenhouse in 2011. It now has five greenhouses, a sophisticated distribution centre and an indoor farm at its HQ.
The company partners with local farmers and food makers and sells hundreds of products through an online store. Lufa also delivers customized food baskets weekly to a network of pick-up points across Quebec and in Ottawa, or straight to customers’ doors.
The rooftop greenhouse at Walmart covers 127,000 square feet, and with new technology, it is predicted to increase vegetable yields by up to 40 percent compared to Lufa’s other rooftops. It uses half the energy of a conventional ground-level greenhouse, recycles up to 90 percent of its water, and relies on energy-efficient LED lighting – all while making use of underutilized urban space.
The rooftop greenhouse is a very clever strategy for local distribution. And it looks as though Walmart might be trialling this one with a view to expansion. "Across the country, we're proud to work with local farmers and producers to bring their products to Walmart Canada's shelves. This collaboration with Lufa Farms brings that approach even closer to home by offering our customers the opportunity to purchase hyperlocal produce grown in the greenhouse above our Marché Central store," said Sam Wankowski, chief merchandising officer, Walmart Canada. "Our customers will be delighted by the local crops that are grown with more sustainable farming practices and then harvested on-demand each day.”
It seems like a win-win-win – for the farmer, the retailer and the customer. What’s your experience with hyper-local distribution? Do you think Walmart will succeed in expanding the concept across the country?
Join the conversation on Canada’s Logistics Community forum!
Emily Atkins
President
Emily Atkins Group
Emily Atkins is president of Emily Atkins Group and was editor of Inside Logistics from 2002 to 2024. She has lived and worked around the world as a journalist and writer for hire, with experience in several sectors besides supply chain, including automotive, insurance and waste management. Based in Southern Ontario, when she’s not researching or writing a story she can be found on her bike, in a kayak, singing in the band or at the wheel of her race car. LinkedIn: https://www.linkedin.com/in/emilyatkinsgroup/