Smaller-format grocery stores continue to expand in Canada. As a result, they are gaining market share from the bigger players.
OVER the past several years, smaller-format specialty grocers have been opening stores at a rapid pace. Consumers are embracing the trend and as a result, these retailers are gaining market share from more traditional large-format concepts. Specialty grocers operate in considerably less space than their larger-format competitors, with some stores measuring less than 2,000 square feet. Smaller footprints allow these retailers to operate where larger players may have difficulty finding space, and cost savings can be had from operating with less retail square footage. While there may be less choice for consumers overall, the timesavings and overall “food edit” has customers returning. 카지노사이트
One of the up-and-coming specialty grocers is Ottawa-based Farm Boy, which has been compared to the popular Trader Joe’s chain in the United States. Farm Boy is known for selling fresh produce and various food products, with an emphasis on farm-to-table wholesale. Attractive stores with warm, natural finishes, as well as friendly customer service keep customers coming back. The updated urban Farm Boy concepts include hundreds of Ontariomade goods as well as artisanal cheeses, naturally aged, premium meats and a high-quality mix of natural, organic, and local foods.
The brand took hold with consumers with such magnitude that Empire Co. Ltd., which is the parent company of Sobeys, acquired Farm Boy in September of 2018 for $800-million.
Despite being owned by Empire Co. Ltd., Farm Boy will remain separate from Sobeys. That’s according to Empire’s President and CEO, Michael Medline, who said in a Tweet “I can assure you that we will not screw this up”. Furthermore, Medline stated to analysts that, “We do not want to ruin the magic of Farm Boy by trying to integrate them. We love what Farm Boy is doing; it has the best brand. We want to see it grow, and we intend to enable the leadership team of Farm Boy to do what they do best: grow a highly successful retail format at double digit rates”.
In March of 2019, Medline referred to Farm boy as being a strategic acquisition for Empire, which will be rolled-out in a big way in the Greater Toronto Area. “We’ve never had a weapon like this to go at an area like the GTA,” said Medline to analysts following the release of Empire’s third quarter results. “Ontario has historically been our Achilles heel,” he went on to say.
Finding real estate for Farm Boy stores will be considerably less of a challenge when compared to larger format grocery concepts. Farm Boy began experimenting with urban format stores when in the summer of 2016, it opened a 19,800 square foot unit in Ottawa’s Westboro neighbourhood, which had a greater focus on instore dining with a larger seating area and “Farm Boy Kitchen” prepared food area. In December of 2017, Farm Boy opened an 8,000 square foot store on the lower level of the CF Rideau Centre shopping complex in downtown Ottawa, which has been a huge hit with locals and visitors, not to mention office workers in the area. 안전한카지노사이트
Nations Fresh Food and Nations Experience
The Nations Fresh Food chain, which operates several locations in southern Ontario, has big plans for its new hybrid grocery and entertainment concept. Called ‘Nations Experience’, the Toronto-based grocery concept occupies a 155,000 square foot former Target store in the city’s Stockyards area.
The actual grocery store component, itself, occupies about 40,000 square feet in the complex, offering a range of fresh food options from a variety of ethnicities. A separated room for seafood is popular with shoppers, as is the expanse of produce, all of which is competitively priced. Large palm trees are tastefully displayed over shelving in the store, which includes interiors accented with marble and wood. The overall experience at Nations Experience is particularly unique.
Frank Ho, Senior Vice President of Nations Experience, explained how he set out to create a ‘FoodTainment’ centre that embraced the world’s cultures. That includes a food hall component that features grab-and-go and sit-down menu options from various cultural groups, ranging from Indian curries to Italian pasta, Chinese dim sum and Japanese sushi.
What’s particularly unique about Nations Experience is the non-retail components that Mr. Ho explained “drives traffic to the building”. Included is a 30,000 square foot entertainment area which Mr. Ho said is “already too small for what we would like to do. It should be triple the size”. The entertainment component is designed for families. After a meal in the food hall, for example, parents may leave their children in the supervised entertainment area while they shop for groceries.
That entertainment area includes a playground, games and arcade area, and meeting rooms. On a given day, dozens of children can be found playing in the supervised play area.
When asked why non-retail uses were added to Nations Experience, Ho explained that the non-retail drives shoppers to the grocery store itself and, as a result, the operation is profitable. Furthermore, Nations Experience has created something of a shopping centre-like corridor and is leasing spaces to smaller retailers.
Moving forward, Frank Ho says that he expects Nations Experience to expand nationally by occupying real estate vacated by retailers such as Target and Sears Canada. An entire shopping centre could even be taken over, creating something similar to a ‘mini west Edmonton Mall’ that would feature core grocery offerings as well as an international dining hall and entertainment options. Experiential retail is the future of brick-and-mortar, he said.
Ethnic Grocery Retail: Seafood City
Filipino-inspired grocery concept Seafood City is looking to expand into Canada in a big way after opening its first Canadian storefront at the Heartland Town Centre in Mississauga in the fall of 2017. The retailer provides a fullservice supermarket, fresh seafood, meat and produce, not to mention dry goods. Besides products catering to the Filipino community, the in-store restaurant options are what really draws the crowds—that includes concepts Grill City, Noodle Street, CrispyTown and the super-popular Jollibee chain, based out of Manila. 카지노사이트 추천
It has become a one-stop shopping and dining destination and also a retail hub that caters to the Asian and Filipino lifestyle in the U.S. and now in Canada,” said Eucliff Cheng, Marketing Manager for the company.
Providing Canada’s expansive Filipino community a ’taste of home’ is a goal for Seafood City, which recently announced a Winnipeg location as part of its national expansion. Shoppers of all backgrounds frequent the Mississauga store, in search of unique items that may not otherwise be available in larger more mainstream grocers.
When Jollibee opened its first standalone location in Toronto last year, it drew incredibly long lineups on its opening day, as well as days after. Including Jollibee restaurants within Seafood City will no doubt be a traffic generator for the retailer. Other concessions at Seafood City stores that draw in the Filipino population include Valerio’s Tropical Bakeshop, TFC (The Filipino Channel), Atlas International Courier, and the Philippine National Bank. In some respects, Seafood City is taking a page from Nations Experience by adding non-grocery offerings to draw in more customers.
Why are we seeing the rise in popularity of specialty grocers?
Grocery industry expert James McArthur explained how consumer preferences are changing, and how grocery retailers are curating selections for convenience. “Local and fresh grocery retail is a significant trend that appeals to a growing segment of the population,” he said. “In a world where there is almost unlimited choice in grocery stores, shoppers are actually seeking out options that stand out in the market, and that are more aligned with their needs and preferences”
“For example, Farm Boy is seen by some consumers as saving them time, both with a more compact store format, and by curating their selection of products to align with their customers aspirations.” They do this while also offering prepared foods”. As a result, some specialty grocery stores are becoming something of a regular “go to destination” he went on to say. “By being a provisioner of meals, not just ingredients, it’s possible to get a consumer base that shops more frequently than at a traditional big-box grocer”.
“Originality is also a factor,” McArthur said, “along with product differentiation. Ultimately, specialty grocers like Farm Boy and the rise of ethnic grocers have resulted in a differentiation that make stores more attractive to consumers. He went on to say, “Smaller stores with a curated selection can also seem less overwhelming, while also a better experience for the time sensitive consumer.”
The large-format grocery chains, in some respects, started the trend towards unique, curated and ‘exclusive’ products.
“When Loblaw introduced the President’s Choice brand to its stores, it created a brand and set of products that you could only get by shopping at that particular store. I predict we will continue to see a growth in private-label and exclusive products in grocery stores, both big and small, as retailers seek to differentiate themselves amid unprecedented competition in the industry”.