The opening of the prototype outlet coincided with a period of rising inflation rates and consumer complaints regarding the high price of food.

[2] Similar limited variety supermarkets had been in operation in Europe for a number of years, and had captured significant market share in several countries.

[3] Months earlier, Loblaw had launched a line of generic products called "No Name" that consisted of 16 unbranded items in very basic yellow and black packaging.

[4] As No Name sales exceeded the company's own projections, Loblaws Supermarkets president Dave Nichol predicted the day when "limited line stores" would offer a complete assortment of No Name groceries[5] While the first No Frills (originally branded no frills) featured the new generic product line, most items were still national brands.

Though the European model typically offered dry goods, Loblaw promoted "fresh produce at the lowest possible price"[6] as a way of attracting customers.

[7] In order to reduce costs as much as possible, No Frills customers had to forego some of the conveniences that North American supermarket shoppers had come to expect.

"[9] In spite of the limited product selection and minimal customer service, the first No Frills store, which advertised "the lowest overall food prices in Toronto", was successful from the initial launch.

With the successful launch of the prototype store, Loblaw began converting a number of its older, more marginal outlets to the new discount format.

Three former Knob Hill Farms supermarkets in Toronto were converted to No Frills after the chain had closed all of its stores in 2001 due to increasing competition.

No Name, which is still heavily featured, has expanded from the original 16 items to more than 2,900 and the company's premium "President's Choice" line is readily available on store shelves.