Canadian Grocer November 2024

A growing appetite for global flavours THE RISE AND RISE OF DISCOUNT GROCERY LESSONS ON LEADERSHIP WHAT’S TRENDING IN SPECIALTY PRODUCE?

NOVEMBER 2024

MIDAS

TOUCH

MEET THE 2024 GOLDEN KARL VOKEY PENCIL EILEEN MAC DONALD JOHN PIGOTT WINNERS FROM TOP LEFT:

C�gratulati�s Eileen MacDonald, John Pigott and Karl Vokey on your 2024 Golden Pencil Award!

from your friends at

Contents 45

Departments

24 The Leaders TOP, FROM LEFT: CHOCOLATE CUPS: SHUTTERSTOCK/PIXEL-SHOT; PEOPLE PORTRAIT: MIKE FORD; SHOPPING CART: GETTY IMAGES/CYANO66; PISTACHIOS: GETTY IMAGES/KONE

33

8

Features

5 Front Desk 6 The Buzz 51 New on Shelf

Lessons from John Carmichael, president & CEO, Nestlé Canada

PEOPLE

8 Shaking things up How a

26 Midas touch

Toronto couple is making waves with a healthier frozen treat

Meet the 2024 Golden Pencil winners!

IDEAS

11 Sizing up food shoppers

33 The rise and rise of discount Retailers are betting on discount.

Will the momentum last?

38 Leadership tips from an egg industry veteran Bill Gray, owner and CEO of L.H. Gray & Son, on cultivating loyalty

A new report looks at how Canadians are dealing with rising food prices

13 Strength in numbers

Star Women in Grocery winners, past and present, share stories of collaboration and support

17 Merchandising in the digital age How grocers can

up their game with digital visual merchandising

18 When stars align See

A growing appetite for global flavours THE RISE AND RISE OF DISCOUNT GROCERY LESSONS ON LEADERSHIP WHAT’S TRENDING IN SPECIALTY PRODUCE?

NOVEMBER 2024

On the cover Golden Pencil winners Karl Vokey, Eileen Mac Donald and John Pigott Photography by Aaron Mckenzie Fraser and Tobi Asmoucha

November 2024 || Volume 138 - Number 7

photos from this year’s sold-out Star Women in Grocery Awards ceremony!

FRESH

43 What’s new in specialty produce? From pawpaws to ‘the new shishito’ pepper, these are the fruits and veggies you need to know about AISLES

45 Bits and bites What

Canadians are seeking when reaching for the snack drawer

49 A world of flavour

There’s a growing appetite for global cuisines and these are the flavours leading the charge

50 Pistachios: Four things to know As a snack, in a spread or a syrup, this little green nut is everywhere EXPRESS LANE

52 Space race PwC’s Fred

Cassano on the state of Canada’s commercial real estate market

COLUMN

MIDAS

TOUCH

MEET THE 2024 GOLDEN KARL VOKEY PENCIL EILEEN MAC DONALD JOHN PIGOTT WINNERS

21 How to win among online shoppers Kantar’s Amar Singh lays it out

FROM TOP LEFT:

November 2024 || CANADIAN GROCER 3

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LESSONS FROM THE TOP What defines the best leaders? A quick Google search on the subject will spit out a seemingly endless list of traits the best leaders should possess—things such as vision, resilience, courage, authenticity and empathy, to name a few.

According to Harvard Business Review, something of an authority on the matter, becoming a great leader is a “journey of continuous learning and growth.” During a fireside chat at the recent Global Produce & Floral Show in Atlanta, Kroger chairman and CEO Rodney McMullen espoused this belief. When asked about his leadership philosophy, the grocery executive—the first in his family to attend university—said he was a huge believer in lifelong learning and education. “I don’t think you ever ‘arrive’ … I’m still trying to become a better leader and be more impactful.”

In this issue, we bring you stories from some of the Canadian grocery industry’s finest leaders. First up, we talk to Nestlé Canada president & CEO John Carmichael for the second instalment in our new “The Leaders” series. Carmichael shares his leadership story—from the biggest risks taken to his “run at the barking dog” approach to solving problems, and how crucial it is within a business to create a culture where people can thrive.

(Read the interview on page 24.) And writer Rosalind Stefanac speaks with Bill Gray, owner and CEO of L.H. Gray & Son, about what it takes to successfully lead a 90-year-old family business (page 38). For this egg industry veteran, it comes down to a hands-on leadership style, says Gray: “We have a philosophy here that you can’t run a business from 40,000 feet up, and

so we’ve never done that.”

Finally, we are delighted to feature Karl Vokey of Sobeys (retired), Eileen Mac Donald of GS1 Canada and John Pigott of Club Coffee and Morrison Lamothe for our cover story.

Turn to “Midas Touch” (page 26) to learn more about these three outstanding leaders and why they’re so deserving of the prestigious Golden Pencil Award for 2024. And be sure to come back next issue when we’ll be shining a light on the industry’s rising leaders, our Generation Next winners. CG

Shellee Fitzgerald Editor-in-Chief

sfitzgerald@ensembleiq.com

Keep up to date on the latest news by signing up for our daily e-newsletter. It’s free and we’ll deliver it to your inbox each morning.

Visit canadiangrocer.com to subscribe November 2024 || CANADIAN GROCER 5

The Buzz

The latest news in the grocery biz

T&T’s 39,000-sq.ft. store in London, Ont. is the largest Asian grocery store in town and offers bakery and in-store prepared foods

OPENINGS

London, Ont. is home to a new T&T SUPERMARKET. At 39,000 square feet, the new store, which opened in late September, is the largest Asian grocery store in town and offers bakery and in-store prepared foods including a hot meal buffet bar, sushi, Hong Kong barbecue pork and a Tianjin crepe station.

London, Ont. also has a new HEALTHY PLANET. The natural foods chain recently opened an 18,000-sq.-ft. store that offers a wide range of products, including fresh organic produce, premium quality meat, natural beauty products, vitamins and supplements. It also features a selection of vegan and gluten-free options.

KALEMART24 continues to expand its footprint. The convenience store chain focused on better-for-you food and

6 CANADIAN GROCER || November 2024

Loblaw’s new ultra-discount banner No Name offers a limited assortment of products including produce and a small range of frozen food items

beverage options recently opened a third location in Montreal, next to the Bell Centre at 1055 Rue de La Montagne. The store offers a curated selection of organic snacks and eco-friendly household essentials.

Following renovations that include wider aisles, improved product displays and upgraded fixtures, RED APPLE STORES

Alessandro’s No Frills smallformat store in Burlington, Ont. recently celebrated its opening with a ribbon-cutting ceremony

recently reopened its store in Forest, Ont. This follows the recent rebranding of four The Bargain! Shop stores (two in Saskatchewan, one in British Columbia and one in Ontario) to the Red Apple banner. “We’re committed to bringing more value and convenience to our customers,” said Brendan Proctor, president and CEO of Red Apple, in a statement.

News to share? Tell us about your openings, comings and goings, etc. by dropping a line to sfitzgerald@ensembleiq.com

LOBLAW COMPANIES LIMITED

LOBLAW has been busy expanding its discount network. In September, the grocer debuted its No Name format in Windsor, Ont., which offers a limited assortment of 1,300 products (shelf-stable bakery and produce items as well as a small range of frozen food items) with savings of up to 20%. Meanwhile, Alessandro’s No Frills small-format store (15,000 square feet) opened in Burlington, Ont.—the banner’s third such store in the province.

PEOPLE

Calgary Co-op CEO Ken Keelor has stepped down after 10 years with the company. Former Loblaw executive Lisa Swartzman has been appointed interim CEO while the board searches for a permanent replacement.

Ken Keelor

Daniel Calderoni

Aurelio Calabretta

Mars Inc.’s snack food company Kind Snacks has tapped Daniel Calderoni as chief executive officer for North America. He previously served as general manager of Mars Pet Nutrition in Canada. Before that, Calderoni was the vicepresident of emerging markets for Pet Nutrition in support of its global growth strategy. He has also served as general manager of Pet Nutrition in the Southern Cone, which includes Argentina, Brazil, Chile, Uruguay and Paraguay.

Aurelio Calabretta has been named president of Zavida Coffee Company. Calabretta spent more than 20 years at The J.M. Smucker Co., most recently serving as vice-president and general manager for Canada. He has also served on the boards of GS1 Canada and Food, Health and Consumer Products of Canada.

Key changes have been made to Keurig Dr Pepper Canada’s executive team. Knolly Smith has been named vice-president of sales and Jean Gagnon has been named vice-president of cold beverages. Additionally, Marc-André Vézina, currently general manager of Van Houtte Coffee Services, has been promoted to senior director of sales for the eastern region.

Several appointments have been made within UNFI Canada’s sales and supplier relationship management teams. Lisa Gilbert has been promoted to senior director, sales strategy, customer experience and field sales; Jillian Andreas has joined the company as sales director for the Empire Group; and Betty Balkowski (McPherson) has been hired as supplier relationship management director for strategic brands.

Knolly Smith

Marc-André Vézina

Jo-Annie Tétreault has been appointed senior manager, sustainability at Bel Group Canada. Tétreault previously worked as an account lead for organizations such as HydroQuébec and the Quebec Tourism Alliance. Most recently, she served as the lead for sustainable growth at Montreal advertising agency LG2.

George Maia has joined REMBrands as vice-president of sales. Maia previously worked at Longo’s as a director of category management and has also held management and analyst positions at Sobeys.

AWARDS/RECOGNITION

The Italian Chamber of Commerce of Ontario Canada (ICCO Canada) has announced the winners of the 2024 ICCO Unico Primo Pentola d’Oro Awards and two of Canada’s grocery executives are among this year’s recipients. Joe Fusco, senior vice-president at Metro will receive the Pentola d’Oro Award, which “recognizes a Canadian company or individual who has excelled in the whole food and beverage industry–from farming to food production, packaging, retail and distribution.”

Meanwhile, Michael Rinaldi, senior vice-president of business enablement and enterprise procurement at Loblaw Companies Limited, will receive the Italy-Canada Award sponsored by Fortinos, which recognizes “a Canadian or Italian company that has excelled in business and cultural relations between Italy and Canada by promoting and developing the Italian food industry in both countries.” The winners will be celebrated at a gala event in Vaughan, Ont. on Nov. 21.

RETIREMENT

Pattison Food Group president Darrell Jones is retiring after nearly 50 years in the grocery industry. Chief operating officer Jamie Nelson will step into the role next March.

Jones began his career Darrell Jones in grocery in 1976, working as a bag boy at the Overwaitea Foods store in Cranbrook, B.C. Jones then moved throughout the province, holding progressively senior leadership roles at Save-On-Foods and associated banners before joining the executive team in 2002. In 2012, Jones was promoted to president of SaveOn-Foods and the Overwaitea Food Group.

Under his leadership, Save-On-Foods and the Pattison Food Group have expanded into the Yukon, Saskatchewan, Manitoba and into the United States.

Metro’s executive vicepresident, chief financial officer and treasurer François Thibault has announced he will retire from the Quebec-based food and pharmacy company next spring.

François Thibault During his 12-year tenure with Metro, Thibault played a pivotal role in acquisitions, including that of the Jean Coutu Group, as well as supporting the modernization of the company’s supply chain. Thibault will work through to his retirement, giving Metro time to choose a successor.

Geraldine Huse, president of Procter & Gamble Canada, is set to retire at the end of this year. During her 38-year career with P&G, Huse (a 2021 Star Women in Grocery Award winner) Geraldine Huse has held leadership roles across the globe. Her tenure in Canada began in 2020, just as COVID began. Effective Nov. 1, Noam Pik, country manager for the P&G Canada fabric and home care business, will succeed Huse.

November 2024 || CANADIAN GROCER 7

People

Who you need to know

SHAKING THINGS UP

How this Toronto couple is making waves with a healthier frozen treat

By Andrea Yu • Photography by Mike Ford 8 CANADIAN GROCER || November 2024

A

decade ago, Tamara Al Dip and Yazeed Yasin immigrated from their hometown of Abu Dhabi in the United Arab Emirates to Toronto with their two young kids in tow. They soon found themselves on the hunt for healthy alternatives to ice cream to give their children, one of which couldn’t consume dairy. “We couldn’t find healthy varieties on freezer shelves,” Yasin recalls. “The main issue is most dairy as well as non-dairy ice creams have added sugars or sweeteners as one of the first two ingredients.”

So, Al Dip decided to make a healthy ice cream alternative in her family’s kitchen. Internet searches led her to a recipe for “nice cream,” made by blending frozen bananas. “Everyone loved it,” Al Dip says. She began tweaking her recipe by adding fruits and nuts to create different textures and flavours.

Friends and other family members loved Al Dip’s ice cream, too. That prompted the couple to consider turning it into a full-fledged business. “We’ve always wanted to start our own business,” Yasin explains. At the time, he was working as a marketing manager for Global News. Al Dip worked in banking before moving to Canada, after which she took a career break. Yasin used his marketing background to conduct research, while Al Dip refined her recipe and developed more flavours. By March 2016, the family had opened Nanashake in North York— the first vegan ice cream parlour in the city. By this time, Yasin had left his marketing career to work full time on Nanashake with Al Dip. Their risk paid off. The shop flourished, fuelled by a growing interest in veganism. NanaPops, their version of ice cream bars, became one of Nanashake’s bestsellers. Customers asked how they could buy NanaPops in other parts of the city, so the couple turned NanaPops into a packaged product in late 2019.

“We ordered some packaging off Uline, slapped some stickers on it and started approaching local stores with our most popular products,” Yasin says. “Initially, we got a lot of ‘noes,’ but eventually, some of the stores decided to give us a chance.”

Their first retailer was the now-defunct Toronto health food grocer Noah’s Natural Foods. The product sold well, so the couple added more local stores to the mix, giving Al Dip and Yasin the confidence to approach the first major retailer:

Sobeys. “We got in as part of their local program,” Yasin explains. “Within a year, we were being sold in 20 of their stores.”

When COVID hit, Nanashake’s retail shop took a hit due to mandatory closures. So, in January 2022, when their retail lease was up for renewal, the couple closed their store and pivoted fully into a CPG business. “It was a little bit sad,” Al Dip says of the store’s closure. “I spent a lot of time there creating new recipes and meeting our community.” But, the couple knew it was the best decision for their business.

That same year, Al Dip and Yasin decided to reformulate NanaPops. The product hadn’t been selling well in some stores and was delisted from a major retailer. The couple reached out to their customers for feedback on how they could improve their products. “Tamara worked on the formulation to make it creamier,” Yasin explains. “We also added more flavours as well as updated our packaging to make it more sustainable.”

The revamped product launched in April 2022, and the couple was pleased to see better sales from NanaPops 2.0. They even got relisted at the grocer who had taken their products off the shelves. “It has now become one of our best-performing retailers,” Yasin says. That same year, NanaPops won two prestigious awards: the Sobeys Local Innovation Award and the UNFI Pitch Slam Competition.

Today, NanaPops are now sold in more than 600 stores in six provinces: Ontario, British Columbia, Quebec, Alberta, Saskatchewan and Manitoba. One of their biggest recent wins was landing on the shelves of Whole Foods Markets across Canada. “That was a dream for us,” Al Dip says. “Nanashake’s retail store was across the street from the Whole Foods Market in North York. We would source our bananas there and we used to say to each other: ‘Can you imagine that our product could be there one day?’”

Looking ahead, Yasin and Al Dip have plans to expand into the U.S. market in 2026. They’ve also been experimenting with innovative merchandising. Recently, in 21 stores, they’ve been placing NanaPops for sale next to the bananas they’re made with. “We’re the first ice cream brand to merchandise its products in the produce sections of some of the biggest food retailers in Canada,” Yasin says. “No other ice cream brand has been able to do this.” CG

30 seconds with …

TAMARA AND YAZEED What do you like best about your job?

YAZEED: We’ve met so many customers who say they couldn’t have ice cream before because of the ingredients, but when they read our ingredient list and realize they can have our product, they’re so happy.

Their reaction is really priceless.

If you weren’t in the food business, what would you be doing?

YAZEED: My passion is marketing.

If we hadn’t started Nanashake, I would most likely still be working in marketing within the media industry.

TAMARA: I love food. I cook everything from scratch. So, I would definitely do something with food, like open a small café or restaurant.

What’s the best career advice you’ve received?

TAMARA: Never take anything personally. I used to be upset when someone said something bad about the brand, but now I can segregate these two things.

What’s your favourite product from your lineup?

TAMARA: For me, it’s Banana Bread. I’m a coffee addict and the Banana Bread is great with coffee.

YAZEED: My favourite is Mango Madness, by far. I love mangoes.

Tamara uses Alphonso mango puree and honestly, it tastes just like a fresh mango.

What do you like to do when you’re not working?

YAZEED: We like to spend time with our kids. They’re really into sports.

Yaz, our son, loves soccer and riding on his scooter. Our daughter, Rafa, is really into volleyball. We all love cycling too, so we’ll go for rides around town together.

November 2024 || CANADIAN GROCER 9

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Ideas

RETAILERS || SUPPLIERS || SHOPPERS || INSIGHTS

SHOPPER SENTIMENT

GETTY IMAGES/FANGXIANUO

SIZING UP FOOD SHOPPERS As Canadians continue to grapple with food affordability, coupons are in and non-essentials are out. That’s according to the Canadian Food Sentiment Index, a new bi-annual insight report from the Agri-Food Analytics Lab (AAL) at Dalhousie University, supported by Caddle Insights.

The report measures Canadians’ perceptions and sentiments on a wide-range of food-related issues and will gather insights from more than 3,000 respondents every six months, so researchers can track trends and shifts.

Looking at their overall expenses, 84.1% of consumers said food prices have increased the most in the past 12 months, ranking No. 1. That was followed by household items and supplies (43%), transportation (36.6%), utilities (35.8%), entertainment and leisure (30.3%), education (10.5%) and childcare (9.1%).

Sylvain Charlebois, professor in food distribution policy and senior director at AAL, wasn’t surprised affordability rose to the top. “In fact, we were expecting it. In terms of expenses, obviously, it reflects the heartaches that people are facing.”

In response to food inflation, Canadians are changing their grocery shopping habits, with nearly half (48.2%) seeking out more sales and discounts. In addition, 30.5% are using more coupons, 25.2% are spending more time searching for better prices online, and nearly 25% are shopping at cheaper stores.

Consumers are also swapping products to trim their grocery bills: 22% are buying fewer non-essential foods such as ice cream, 21.6% are switching to cheaper brands, 16.8% are buying fewer premium foods such as meat and fruit, and 16.7% are switching to generic brands. Notably, only 6.3% report little to no change in their shopping habits.

Canadians were also asked about their food values, or the major factors they consider when buying food. Affordability is dominant here as well, with 47.3% citing that as the most significant factor. Second on the list is nutrition (24.9%), indicating strong interest in healthy eating. That’s followed by taste (16.7%), availability (5.5%), social responsibility (3.2%) and environmental impact (2.5%). —Rebecca Harris

November 2024 || CANADIAN GROCER 11

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STRENGTH

Ideas

IN NUMBERS An important step in building a career is fostering relationships that can encourage an individual to move outside their comfort zone, help them achieve a healthy work-life balance and to become the type of leader they aspire to be.

During a keynote presentation and panel discussion at Canadian Grocer’s Star Women in Grocery Awards breakfast in Toronto recently, speakers touched on this and more with stories of mentorship, collaboration and support.

“This is going to sound really cliché, but I truly live by the saying, ‘it takes a village.’ So, find your village. It should be your spouse, first and foremost, but also friends, neighbours, other family members who can help you accomplish everything day to day. You don’t need to do everything. That village also translates to your work. You need to build your village in the workplace so when go on vacation with your family, you can ... trust everything is going to work smoothly at the office.”

—Candice Chan, controller, financial reporting and analytics, Metro Ontario

“I have always been so hard on myself and it seems to be part of my lifelong journey to work on that self-recognition and validation and acceptance and trust that I can do this.

So, what I’ve done is try to create this safety net of leaders that I trust, that I know I can lean on for support when those feelings of imposter syndrome creep in. I’ve had leaders that have pulled me out of my comfort zone and shoved me at the next opportunity and, while those opportunities were really hard, what I came to discover is that it’s been in those moments that I’ve stretched myself and developed a greater resilience and confidence and built my efficiencies. I am, ultimately, so grateful to those leaders who have helped me to grow and who put that effort into my development because without them, I wouldn’t be here today.”

—Kim Roth, category customer sales planning leader, The Clorox Company of Canada

GOLDMEDIA.CA

By Kristin Laird

“When you think about connections, we think about work, we think about the professional part of it, but I think it’s also really important for personal growth to meet new people and to learn from them. Whether it’s in your personal life or your professional life, harnessing connections and building your network can really make a difference. It can inspire you to do more than you would have thought possible.”

—Sandra Sanderson, chief marketing officer, Empire Company Limited

“We’ve all had that leader or group of leaders in our lives where they’re leading us through something challenging or something great and we take that moment and say, ‘Wow, this is the person I want to be in 10 years’ time.’ Some of the advice I’ve been given is if you have the opportunity to learn from those really inspirational go-get-them leaders, if you ever have the opportunity for mentorship or even a conversation with them, don’t waste that chance. And if not, observe their behaviour and observe what makes them make you stop in your tracks and listen and want to be led in that way.”

—Ashley Melito, VP of sales, Mars Pet Nutrition Canada

“Work-life balance really comes down to the individual—it means different things to everyone. Those who know me well would probably say, ‘Jenn, you don’t have much balance.’ But, I would tell you, I do. I would say this: I work with a group of individuals that when it’s time to tap out, when things get tough, not only from a personal family but a professional family [perspective], we’re all here to support each other and that to me is what helps me achieve my balance.”

—Jennifer Teixeira, VP of operations, Loblaw Companies Limited, Hard Discount, No Frills (Ontario & Atlantic)

November 2024 || CANADIAN GROCER 13

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Egg Quality Certification Aligns with Consumer Preference for Sustainable Food More than half of Canadians factor in sustainability when it comes to purchasing their food.1 Yet, with more and more choices on store shelves, it can be difficult for consumers to identify foods created with responsible production practices.

According to a recent study commissioned by Egg Farmers of Canada, Canadian consumers increasingly want to know how their food makes it from the farm to their table, and 70% of Canadians are factoring in key sustainability considerations - such as the nutritional value of the food, whether it is locally sourced and if it meets quality and safety standards - when making their purchasing decisions.1 The Egg Quality Assurance™ (EQA®) certification mark is an important tool to provide Canadians with the clarity and confidence they need when purchasing fresh, local and high-quality eggs.

The components of the EQA® program are core pillars of sustainable egg farming in Canada. It all starts on the farm, where egg farmers nationwide follow the Start Clean-Stay Clean® food safety program. From inspections to mandated standards for storage, cleanliness, air quality and more, the program is acknowledged by the Canadian Food Inspection Agency for being technically sound.

Farmers must follow the rigorous standards of both the Start Clean-Stay Clean® program and Animal Care Program. In fact, all regulated egg farms must meet these standards to receive their EQA® certification and for their eggs to be sold in stores or at restaurants.

For Canadians, the EQA® certification mark is more than a symbol, it’s a beacon of trust. Especially for the 9 out of 10 Canadians who feel that a quality symbol on egg cartons would reassure them that the eggs meet national standards.2 For leaders in retail and foodservice, displaying the EQA® certification mark on cartons, products and menus means meeting consumer preferences and showing them they can trust the Canadian eggs you sell.

For more information on the Egg Quality Assurance™ program and to learn more about the standards behind the EQA® certification mark, visit eggquality.ca

At the same time, Canadian egg farmers take part in a national Animal Care Program, which is based on a national Code of Practice. This includes regular inspections and third-party audits to ensure hens have a comfortable environment, a well-balanced and nutritious diet, fresh water, and clean surroundings.

Environics Analytics (2023, June). Egg product sustainability messaging study. [Unpublished data].

Prepared for Egg Farmers of Canada.1 Maru/Blue (2019, February). National Egg Quality Assurance Omnibus. [Unpublished data].

Prepared for Egg Farmers of Canada.2

#OnlyInCanada do we picnic all year long.

As winter approaches, we embrace the uniquely Canadian moments that make this season special.

Yes, they can sometimes get a little messy, but that’s what makes them memorable—just like Kruger Products, proudly Canadian through and through. With ten manufacturing facilities across the country, our team provides comfort and care in the moments that matter most through our quality paper products under leading brands such as Cashmere, Purex, SpongeTowels, Bonterra, and Scotties.

With our deep Canadian roots, Kruger Products and our employees know the Canadian winter experience—and the beautiful mess that comes along with it. From BBQing in the cold, slushy boot tracks, and stocking up for snow-ins, to gathering together for hockey watch parties, the season is truly Canadian and unique to everyone. Kruger Products proudly celebrates the Canadian winter experience and offers a selection of products that are part of these everyday moments, touching the lives of so many Canadians all season long.

Visit mykrugerproducts.ca for more information.

PROUDLY MADE IN CANADA

*

© 2024 ® Registered Trademarks and TM Trademarks of Kruger Products Inc. ®’ Registered trademark of Kimberly-Clark Worldwide, Inc., used under licence *With domestic and imported materials

Ideas

MERCHANDISING IN THE DIGITAL AGE

How grocers can up their game with digital visual merchandising

By Rosalind Stefanac BORN AND RAISED in New York, Michael Silverman spent a big part of his career in consumer technology before moving to Canada to lead Flipp in helping North America’s largest retailers and brands transform their digital merchandising strategies. Based in Toronto, the company works with its partners (many of which are grocers) to create, curate and distribute local promotional and savings content to millions of shoppers every day. Here, Silverman shares his insights on how digital visual merchandising is changing the shopper experience and what retailers need to thrive in the digital age.

How has shopping changed in this digital age?

People have been shifting online to shop for a long time, and COVID-19 further accelerated that to the point where online is becoming the largest research centre for the shopper. However, the online experience, especially for high-frequency retailers like grocers, is still at a disadvantage because you don’t get to engage all your senses as you would in-store. Though grocery e-commerce has grown dramatically over the last four years, the majority of shopping still happens in-store. Still, Canadians are spending a little less time in-store and a lot more time online figuring out where they’re going to shop and what they’re going to buy.

FLIPP

What does that mean in terms of how products are merchandized?

The four Ps of traditional merchandising still hold true: product, placement, pricing and promotion. But, in the throes of a challenging macroeconomic climate,

pricing and promotion are the largest influencing factors right now. So, we’re working to create an amazing shopping experience by helping shoppers make informed decisions, while also helping retailers create demand. With our platform, we help our high-frequency retailers capture the attention of a shopper online and then convert them to in-store through digital visual merchandising.

to revolutionize the interaction between the shopper and retailer but rather to help retailers stay ahead of the curve to become market leaders.

What does that entail?

Where do loyalty programs fit in?

It all hinges on our ability to help the shopper understand and contextualize the product, whether that’s with 360 - de gre e views, gre at metadata descriptions (i.e. height, width, weight, etc.) and bright visuals that easily show them what’s on sale. The early days of traditional e-commerce grids with rows and rows of austere products on white backgrounds no longer fit. It’s about contextualizing the product and instead of a picture of a raw protein on sale, it’s important to see the burger you’ll make out of it and the picnic that can be created as a result.

There are some shopper loyalists for whom these programs are very important. But, the vast majority of consumers are looking across retailers and it’s about leveraging advances in AI and digital to win that shopper’s attention and drive them in-store to buy more and have a great shopping experience.

Where does artificial intelligence (AI) come into play?

I think it boils down to optimization.

Whether it’s a planogram in-store or some form of promotional activity, AI is supercharging a retailer’s ability to optimize, target and then subsequently personalize the experience. There are always going to be some limitations due to legislative privacy laws, etc., but personalization is going to become more and more important. That said, I don’t expect AI

What’s the advantage of using a platform such as Flipp for grocers?

At the end of the day, your data is the most critical asset you can invest in.

We have a platform where we see across retailers and shoppers … so, we have huge sums of data that we leverage on behalf of retailers to help them influence shopping decisions. [In the U.S.] the Krogers and Safeways of the world have made massive investments in data infrastructure and that’s why they’ve become such successful players in the retail media landscape.

Your data is sitting somewhere, whether it’s in your loyalty programs or in inventory management solutions … and one of the things we’ve become great at is helping our retailers clean up some of this data and better access and leverage it.

November 2024 || CANADIAN GROCER 17

It was a morning of celebration (and inspiration)

WHEN STARS

as Canada’s grocery industry came together in Toronto on Sept. 26 to recognize Canadian Grocer’s 2024 Star Women in Grocery winners.

A sold-out crowd of nearly 700 attendees were on hand to recognize this year’s 60 winners for their remarkable career achievements and contributions to the industry, for what was Canadian Grocer’s largest Star Women event yet.

The morning kicked off with a keynote presentation from Sandra Sanderson, chief marketing officer at Empire Company Limited and a 2015 Star Women in Grocery winner, on the opportunities stepping outside of a career comfort zone presents.

Next, as part of a panel discussion moderated by editor-in-chief Shellee Fitzgerald, four of this year’s winners—Candice Chan (Metro Ontario), Ashley Melito (Mars Pet Nutrition Canada), Kim Roth (The Clorox Company of Canada) and Jennifer Teixeira (Loblaw/NoFrills)— shared their ideas on overcoming imposter syndrome, finding work-life balance and how mentorship has benefitted their careers. CG

PHOTOCREDIT GOLDMEDIA.CA

ALIGN

18 CANADIAN GROCER || November 2024

Ideas

November 2024 || CANADIAN GROCER 19

This year Canadian Grocer was proud to host the Star Women Networking Lunch, held immediately following the Star Women Awards at The International Centre on September 26th.

Attendees were treated to an animated discussion by a panel of former Star Women winners that included: Marcy Crouse of Kraft Heinz Canada, Stacey Kravitz of UNFI Canada and Susan Irving of Kruger Products. Led by moderator Deb Craven, President of Longo’s, this panel shared tips on how they built their networks, their journey on becoming leaders and some of the surprises they encountered along the way.

“Women often struggle with networking. It is something we hear over and over again from people in this industry. With that in mind we wanted to create an opportunity for the Star Women community to network with each other, and discuss the challenges they face, and we definitely accomplished that today, “ noted Vanessa Peters, Publisher, Canadian Grocer, “We can’t wait to do it again!”

Gold Sponsors:

Silver Sponsor:

RETAIL REVOLUTION || Amar Singh shopping trip. Furthermore, 34% of Canadians cite transportation or mobility issues as a significant reason to shop online, indicating that convenience can mean overcoming logistical barriers. This is particularly true in the Atlantic provinces, where access to large grocery stores may require extended travel.

For retailers, these insights highlight the need for intuitive and efficient digital platforms.

How to win online grocery shoppers in Canada Retailers must cater to shoppers’ preferences for convenience, digital engagement, value and omnichannel

Canadian shoppers are leveraging digital tools to make grocery shopping more strategic, implying the experience is about more than simply completing a transaction

KANTAR’S CANADIAN SHOPPERSCAPE study offers an in-depth look at the rise of online grocery shopping in Canada, uncovering significant shifts in shopper attitudes and behaviours. Four key trends emerge as retailers and brands navigate a digital-first landscape: convenience, digital engagement, hybrid shopping models and a renewed focus on value.

Regional differences add further complexity to these themes, revealing how various provinces and demographics approach grocery shopping in Canada.

CONVENIENCE IS NON-NEGOTIABLE Convenience has become a core expectation for Canadian shoppers, with Kantar’s Canadian ShopperScape study revealing 52% of Canadians favour online grocery for the flexibility of shopping anytime. Additionally, 48% of shoppers highlight time-savings as a primary benefit, underscoring the shift toward online channels to simplify routines and meet the demands of a busy lifestyle. Shoppers in major urban areas, such as Ontario and British Columbia, lead this charge, as these regions have broader access to online grocery options.

The convenience of e-grocery resonates especially with millennials and gen Z, who seek a streamlined experience. Notably, 53% of millennials say shopping online saves them time. One of the unique appeals of online shopping is the ability for shoppers to gradually build a basket over multiple days, aligning with modern preferences for flexibility. For some, this ability to add items as needed fits into daily routines more seamlessly than a traditional one-time

DIGITAL TOOLS OFFER MORE THAN JUST TRANSACTIONS Canadian shoppers are leveraging digital tools to make grocery shopping more strategic, implying the experience is about more than simply completing a transaction. Younger millennials, particularly, rely on loyalty apps and digital platforms to manage their spending and use digital tools to avoid impulse buys and make smarter purchases.

Beyond transactional needs, shoppers increasingly look for inspiration online, with many valuing personalized suggestions, recipes and meal-planning ideas. By enhancing online tools with content that supports shopper aspirations, brands and retailers can enrich the experience and foster loyalty.

OMNICHANNEL SHOPPING COVERS THE BEST OF BOTH WORLDS Despite the popularity of online shopping, physical stores remain essential across Canada, especially among gen X, boomers and shoppers in Quebec, who place high value on in-store service and immediate product access. The study shows Canadians prefer a hybrid approach, blending the convenience of digital shopping with the benefits of physical stores. Millennials and gen-Z shoppers are driving the demand for buy-online-pickup-in-store and locker pickup options. For many younger shoppers, this hybrid model balances time-saving convenience with the personalized in-store experience they still value.

VALUE REMAINS THE BOTTOM LINE While convenience drives online grocery adoption, value is a critical factor. According to the ShopperScape study, 39% of Canadians actively search for online deals, but high online prices and delivery fees remain pain points that can drive shoppers back to the physical store. For many Canadians, high online prices and slower shopping times compared to in-store experiences are among the biggest frustrations with e-grocery. Younger millennials find delivery or pickup fees are often too high, which inhibits their full adoption of online grocery shopping.

ADAPT OR FALL BEHIND As grocery retail evolves, emphasizing digital integration, competitive pricing and flexible fulfilment will be crucial for driving market share and fostering deeper loyalty. CG

Amar Singh is a senior director at Kantar Retail. He creates insights that inform strategic decisions about key drug, home improvement, discount, convenience, grocery and digital channels. Amar is a seasoned brand, shopper and advertising researcher.

November 2024 || CANADIAN GROCER 21

CHOCOLATE AND CARAMEL Flavoured coffee in capsules compatible with Nespresso* Original machines

NEW

*Lavazza is not affiliated with, endorsed or sponsored by Nespresso

coffee CATEGORY CLOSE-UP

A year-round staple

Coffee continues to be a staple in Canadian homes and at retail, with no signs of slowing down. Its popularity endures because it provides both a daily ritual and a moment of indulgence, whether at home or on the go. While the colder months naturally boost coffee consumption, the demand for coffee remains steady year-round. Specialty coffee products, in particular, thrive across all seasons, as consumers seek more customized, high-quality experiences. The rise of specialty coffee speaks to a broader shift in how consumers view coffee— not just as a functional drink but as a personal experience.

Canadians are no longer waiting for special occasions to treat themselves; instead, they’re finding ways to enjoy premium coffee moments in their everyday lives.

Convenience, quality, and personalization While ground coffee continues to lead the coffee product category in Canada, single-serve formats are seeing the most growth, driven by consumers seeking a balance of convenience, quality, and personalization. Convenience may be key, but consumers are not willing to compromise on premium quality, and many are actively exploring new beverage options, making limited-time offerings and unique flavours increasingly popular. At the same time, sustainability has become a major factor in consumer decisions, as coffee drinkers pay close attention to how their choices impact the world around them.

New generations of coffee drinkers Flavoured and single-serve products are becoming increasingly important, especially for younger consumers.

Millennials and Gen Z are emerging as passionate coffee

enthusiasts, with Gen Alpha not far behind, and their expectations for innovation in the coffee space will continue to shape the market in coming years. These consumers value personalized, customizable coffee experiences, leading to strong demand for diverse flavours, limited-time offers, and different brewing methods. These segments are not just passing trends—they represent a shift in how consumers engage with coffee, a shift that will continue to drive growth as these consumers’ buying power increases. Looking ahead, brands must prioritize product innovation, sustainability, and new flavour profiles to capture this evolving audience.

A focus on innovation Lavazza has remained a consumer favourite for over a century due to its deep-rooted commitment to quality and innovation, constantly evolving to meet the changing preferences of consumers worldwide. “The brand continually optimizes its portfolio to meet the ever-changing needs of consumers, ensuring it remains relevant in today’s dynamic market,” says Roberto D’Elia, Director of Retail, Canada for Lavazza. “Lavazza’s attention to detail, adaptability, and continued focus on listening to consumers have cemented its place as a beloved coffee choice across generations. By combining insights from data, education, and real-world feedback, we ensure we are always at the forefront of coffee innovation.” The company is now introducing chocolate and caramel flavoured coffee capsules to its line of Lavazza Nespresso Compatible Capsules, which combine Lavazza’s premium quality with the ease of single-serve coffee.

“The capsules allow consumers to explore new flavours and personalize their coffee experience effortlessly, while elevating their everyday moments with a touch of indulgence and variety.”

Top Shelf Picks New varieties of Flavoured Lavazza Nespresso Compatible Capsules Flavoured Lavazza Nespresso Compatible Capsules are compatible with Nespresso Original® brewers, and directly respond to consumer demand for convenience, variety, and customization. The new caramel and chocolate varieties complement the existing range of light to extra-dark roast coffee, offering something for every palate. Available in early 2025.

SPECIAL PROMOTIONAL FEATURE IN CANADIAN GROCER || November 2024

THE LEADERS

LESSONS FROM THE TOP

JOHN CARMICHAEL, PRESIDENT & CEO, NESTLÉ CANADA How did you get your start in the business?

I started out in pet food [at Nestlé] in Southern California, that’s where I grew up. I went to UCLA undergrad and graduate school.

What is your leadership story?

I’ve been almost 30 years with Nestlé, but I really feel like I’ve had many, many different jobs and careers during that time. I’ve lived all over North America and Europe and I’ve worked in many different disciplines—from marketing and sales and HR and all the way up through general management. At some point, my career turned to business turnarounds. And really that was dropping into distressed businesses or distressed teams, acquisitions and integrations or major events that needed to take place; for instance, relocation of a business or a division and to help the group get through it. What that really means is building teams, developing people and creating enduring business strategies.

What would you say are the crucial skills for a successful leader today?

This is a more interesting question today than it would have been five years ago, when I would have answered tenacity— the stamina and ability to stick with things and keep your team focused and their energy “AS A LEADER, YOUR FIRST JOB up. But, I think things have IS TO GET THE RIGHT PEOPLE. changed and I would now say YOUR SECOND JOB IS TO BUILD curiosity, agility and empathy A CULTURE THAT THEY CAN are crucial.

THRIVE IN. AND THIRD, YOU’VE

GOT TO LISTEN TO YOUR PEOPLE AND HELP THEM SUCCEED” – JOHN CARMICHAEL

By Shellee Fitzgerald • Photography Mike Ford 24 CANADIAN GROCER || November 2024

Tell us about the biggest risk you’ve taken in your career.

The first risk I took was my very first relocation when I moved to St. Louis from Southern California. Nestlé had just bought Purina and it was a separate company, so even though we bought them, I moved into their organization and I didn’t have a personal or professional support structure. So, it was a big professional risk. I was the

outsider and the “acquirer” and it was a personal risk because I didn’t necessarily know how to set up my personal support system. I struggled through and learned a ton. I call it my second MBA because I learned a lot about how different companies think and that two different [approaches] can be right. I also learned how to put myself out there socially; I met a bunch of new people and these experiences served me well as I moved personally and professionally through my career.

What is the one piece of wisdom you’ve carried with you through your career?

I’d say I’m still developing wisdom, but the one I use a lot is “run at the barking dog”—the barking dog being an analogy for problems. But, the truth of the matter is, when a dog is behaving badly, if you handle the situation quickly you can take care of it. But, as dogs become more emboldened and rougher, maybe even scarier, they can become really big problems over time, and so do problems in business relationships and with people. The key is to find [those problems] and handle them quickly.

I’ve spent a career literally fixing and attacking the barking dog. And it is good career advice because those who rise to the top quickly are the problem solvers, the ones that are not afraid to run into the fire, and that’s not just in business.

Have you had a mentor or manager that has positively influenced your career?

I’ve had so many, but there’s one individual, who’s quite senior in the organization, who consistently made what I would call the right decision from a values perspective. And this [became] a beacon for the rest of us that it was OK sometimes to not make the best decision if it wasn’t the right decision. Often when I am in a tough situation, I always think what would he do?

The other thing I would say, and it may be less obvious, but I think it’s easier to learn from bad managers than good managers. It’s very difficult to replicate a good manager’s leadership skillset because it’s so inherent to an individual’s DNA. It’s easier to form our own skillset in reaction to tough situations that we’ve witnessed and were able to overcome.

And so, some of the people I’ve learned the most from are people that were not the best leaders, but they enabled me to develop my leadership style in response.

Has there been a pivotal moment in your leadership journey?

As a young marketing associate, I had what was considered a funny, in retrospect, but risky strategy on the business I was on. My manager disagreed with me, but to her credit she allowed me to take it all the way up to the president of the division. I “went in hot,” as they say, and he was a man of few words, and one of the people I would pick as a mentor. He looked at me and said, “do it!” But on my way out, he stopped me and he said, “John, I invest in people, not ideas.” There were two really important takeaways from that. One: the reason things don’t get done oftentimes is people don’t ask. They don’t put together their argument and passionately put out an argument. I’ve had the craziest ideas you can imagine through my career, and I’ve almost never been told no. And some of them I should have been told no, but because I put the passion out there and because I believed in it and because I asked, they said yes. The second thing is that an investment in a good person with passion—and hopefully a good idea—is a far better investment than in a great idea then looking for someone to execute it.

How have you learned to get the most from your teams?

Look, as a leader, your first job is to get the right people. Your second job is to build a culture they can thrive in. And third, you’ve got to listen to your people and help them succeed. Sometimes it’s helping them build the confidence to get it done. Sometimes it might be helping them refine their idea, but at the end of the day, you’re helping them succeed. So, you’ve got to stop and listen. It’s the most important thing.

Most rewarding part of being a leader?

If I were to have something put on my tombstone, it would be helping people achieve things they didn’t think they could. That is amazing. I was a camp counsellor in high school and I had a particular kid that I can think of clearly today that hated horses—was scared of them. We worked on it through the course of the summer and, to make a long story short, the look on his face when his parents visited and saw him on that horse, I’ll never forget. I didn’t do a thing in that particular case. I helped him, I gave him maybe some confidence,

maybe a safe environment. That kid did it all, and in a million years he didn’t think he could pull it off. And that is what makes me so excited to be in this role is to watch teams do that every day. That is just amazing! CG

This interview has been edited for clarity and length.

FAST FOUR 1

YOUR FIRST JOB?

At the Sunday Los Angeles Times, putting together (stuffing, tying) the newspaper between midnight and 4 a.m. at age 16.

2

HOW DO YOU TURN OFF WORK?

My passion is backpacking and I’ve done a trip with the same folks for 22 years; we literally throw everything on our backs and head out into the wilderness. I find there’s no better way to turn off work. And there’s no better quality time with friends than to have that kind of uninterrupted time.

3

IF YOU WEREN’T IN THE CPG INDUSTRY YOU’D BE . . .

A camp counsellor for sure.

Working with kids is the most rewarding thing you can ever do and provides a bigger insight into people’s true nature than any other job I’ve had.

4

PEOPLE WOULD BE SURPRISED TO KNOW . . .

I’m scared of heights!

November 2024 || CANADIAN GROCER 25

The Golden Pencil Awards will be handed out at Toronto’s Fairmont Royal York on November 25. For tickets visit groceryconnex.com

MI DA S

A fierce supporter and protector of the grocery industry in Atlantic Canada, a visionary leader who has worked tirelessly to promote supply chain standards, and a third-generation executive who took the family business to new heights are recipients of the prestigious 2024 Golden Pencil Award.

Handed out annually since 1957 by the Food Industry Association of Canada, the Golden Pencil Award recognizes long-standing contributions of grocery leaders to the industry and to their communities. Read on to learn more about this year’s winners Karl Vokey, retired SVP national sourcing and own brands for Sobeys; Eileen Mac Donald, CEO and president of GS1 Canada; and John Pigott, CEO of Club Coffee and Morrison Lamothe Inc.

By Shellee Fitzgerald and Kristin Laird

26 CANADIAN GROCER || November 2024

TOUCH

Golden Pencil

KARL VOKEY

AARON MCKENZIE FRASER

SVP National Sourcing and Own Brands, Sobeys (retired) “LOVE AT FIRST SIGHT” is how Karl Vokey describes his early days as a trainee at Sobeys’ Wholesale Division in St. John’s, N.L. He landed the role straight out of university and says, “I got into an industry that I loved so, so much; hence, I became a lifer at Sobeys.”

Over his 35-year tenure at Sobeys—he retired from his role as senior vice-president national sourcing and own brands at the end of last year—Vokey worked in many parts of the business, something, he says, that allowed him to witness and participate in the company’s incredible growth. But when asked what he’s most proud of in his career, Vokey says it’s how he was able to support and protect the grocery industry in Atlantic Canada.

“I get a little bit emotional when I think about it,” he says. “Given all the growth of Sobeys across the country, I was very proud to maintain and help support Atlantic Canada and, in particular, the [company’s] hometown of Stellarton, N.S.,” he says, where he’s worked to support the employees and the functional areas of the business while making sure “the rest of the company didn’t forget about the home base, the culture, the values of the company.”

When asked what piece of wisdom has served him well over his decades-long career and what advice he would give to up-and-coming leaders in the business, Vokey says he’s a firm believer in focusing on the long game. “Don’t always focus on the battle, focus on the war,” he says. “I’m a big believer in focusing on the long-term strategy; if you’re shortsighted, sometimes you’ll make decisions that you’ll regret in the long run.”

Vokey credits his mother and father for his strong work ethic. “They worked very, very hard,” he says, adding that his parents also shaped his values. “The values and priorities they instilled in me, like ‘pay off your bills,’ ‘never owe anyone anything,’ ‘pay off your mortgage,’ ‘look after your family’—was pretty salt-of-the-earth stuff.” And he attributes his success to “honest and open conversations” with mentors and leaders over the years who pointed him in the

right direction and helped him see things differently.

“Sometimes they were tough conversations and tough for me to take at the time,” he recalls. “But, rather than being defensive, I was open enough to see that what they were saying was for the betterment of my career and I thank them even today for pointing those things out to me.”

November 2024 || CANADIAN GROCER 27

Congratulations

Karl Vokey on receiving the 2024 Golden Pencil Outstanding Service Award

Empire and our 128,000 teammates celebrate Karl Vokey, retired SVP National Sourcing and Own Brands, winner of the 2024 Golden Pencil Award.

Karl’s 35-year legacy of dedication to customers, suppliers, and his community serves as an inspiration to us all.

Golden Pencil

EILEEN MAC DONALD

GS1 CANADA

Chief Executive Officer and President, GS1 Canada

DESCRIBED BY COLLEAGUES as a visionary leader, Eileen Mac Donald has been lauded for her tireless work to promote supply chain standards during her more than 20-year career at GS1 Canada.

Mac Donald stepped up to the top job at GS1 Canada in the midst of a global pandemic. She has stated that embarking on a CEO transition (while managing through COVID) was not only the biggest challenge of her career, but also “truly a tremendous achievement.”

Since taking the reins at GS1 Canada, Mac Donald has been credited with driving the company’s double-digit growth through her strategic foresight, innovative thinking and commitment to

collaboration, all of which have helped make her organization a trusted partner across industries such as grocery and foodservice.

Mac Donald has also earned a reputation as an authentic, people-first leader.

In 2022, Mac Donald was the recipient of another industry award—Star Women in Grocery. At the time, Canadian Grocer asked Mac Donald how she would describe her leadership style, she said: “I am a people-first leader and I learned that the most important asset to any business is the team. It doesn’t matter what your strategy is, what your budget is, who’s on your board, etc. You are not a leader if you don’t have fellowship. To be privileged to work with incredibly bright, committed, focused and aligned team members is the best part of my job. My focus on people is reflected in the core of who I am as a person.”

During her time at GS1 Canada—a not-for-profit association that develops and maintains global standards for efficient business communication— Mac Donald has served as senior vice-president of marketing and operations and was also its chief operations officer. Prior to joining GS1 Canada, Mac Donald gained experience working for Home Depot, the Clarke Institute of Psychiatry (a division of The Centre of Addiction and Mental Health) and was also a small business owner.

November 2024 || CANADIAN GROCER 29

Golden Pencil

JOHN PIGOTT

TOBI ASMOUCHA

CEO, Club Coffee and Morrison Lamothe Inc. IF THERE WAS ever concern John Pigott would reap the benefits of nepotism, it was quickly squashed in 1979 when his mother and aunt fired him from Morrison Lamothe Inc. (MLI), the family-owned and operated bakery-turned-frozen food manufacturer founded by his grandfather, Cecil Morrison, in the early 1930s.

“I made a mistake and I gave a discount that I was not authorized to give,” Pigott recalls. “My mother was the [company] chair and my aunt was the president and I was asked to leave and to go make mistakes on someone else’s payroll.”

So, Pigott left and joined Xerox (“the best sales training place at the time”) for six-and-a-half years, gaining experience, confidence and sales disciplines he follows to this day.

“I learned you never go into a meeting without a plan. You learn how to close for an order. And, if you talk more than half the time, you’re not going to win the deal,” he says.

Pigott eventually rejoined the family business in 1986 as vice-president and was appointed president and CEO three years later. “I came back with the confidence that I could make it on my own and not be just the boss’s kid,” he says.

And he did just that. Under Pigott’s leadership, MLI expanded through acquisitions including Northern Fine Foods in 1990 and Club Coffee, one of the largest coffee roasters in North America, in 2005.

And, in 2022, Olam food ingredients (ofi) acquired Club Coffee at an enterprise value of $150 million, according to a press release announcing the deal.

“I did what my mother suggested I do … Go make mistakes someplace else, but come back [to MLI] and add value,” he says.

Now semi-retired, Pigott is looking to add value to the industry in a different way: through mentorship.

Instead of “heading to Florida and playing golf,” Pigott says he is spending most of his time mentoring the next generation of leaders. And in recent weeks, Food, Health and Consumer Products of Canada announced Pigott was its new board chair. “The industry was good to me. It’s pay it forward time.” CG

November 2024 || CANADIAN GROCER 31

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Feature

The RISE and RISE of discount grocery As shoppers seek savings, retailers are betting big on discount, but will the momentum last?

GETTY IMAGES, CYANO66

By Rebecca Harris

DISCOUNT GROCERY STORES have long been a draw for budget-conscious consumers, but with rising food prices and a higher cost of living, even those who once filled their carts without a second thought are now seeking ways to trim their grocery bills.

A February 2024 survey by Caddle Insights found more than 62% of grocery shoppers have switched primary grocery stores to secure better deals, and nearly 30% select grocery stores based on in-store discounts and promotions. More recently, the Canadian Food Sentiment Index by the Agri-Food Analytics Lab at Dalhousie University, supported

by Caddle Insights, found nearly 25% of Canadians are shopping at cheaper stores.

“Discount has almost always been winning, other than a blip during COVID when conventional gained because you could do a one-stop shop and shop less frequently,” says Ransom Hawley, founder and CEO of Caddle. But now, he adds, more Canadians are changing how they eat and shop as they look to stretch their dollar as far as possible.

While Hawley’s insights are grounded in data, he shares a personal anecdote that’s playing out across the country. “Even in our household—and we’re certainly more fortunate than the average Canadian— we switched primary grocery stores because the prices were better,” he says. “We’ve traded to more private-label products because the prices are better. Even over Thanksgiving weekend, my uncles were talking about using price matching—that never would have crossed their minds before.”

November 2024 || CANADIAN GROCER 33

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Better Everyday Health With Humanity

Get Well. Stay Well. Scan to learn more.

FA_PNP-halfpage_Grocery-AI.pdf

1

16/10/24

18:30

Feature MAKING BIG PLAYS FOR PRICE-CONSCIOUS CONSUMERS

As value becomes a focal point in Canadian households of all types, major grocers are doubling down on their discount strategies—opening new stores, converting conventional stores into discount banners and launching all-new ultra-discount concepts.

“Discount has always been there … but the pace is ramping up as the economy is still top-of-mind for many people. That doesn’t seem to be going away in the near future,” says Lisa Hutcheson, retail strategist and managing partner of J.C. Williams Group. “Customers are willing to sacrifice to save money now. They are willing to give up some of the comfort they used to have from their go-to retailers.”

Loblaw, in particular, is making a significant play in the discount channel. This year, the retailer announced plans to expand its discount banners, No Frills and Maxi, with 40 stores—a mix of conversions and net-new stores. For No Frills, the focus has been on smaller footprint stores, typically around 10,000 square feet in urban markets.

Recent openings include a small-format No Frills in Burlington, Ont., one in Toronto’s Liberty Village neighbourhood and one in the city’s entertainment district.

In August, Loblaw made noise with its new, strippeddown discount concept, No Name, which is being piloted with three stores in Ontario. The stores carry a small range of pantry staples, produce items, bakery products and household necessities—but no dairy or fresh meat—primarily under the No Name and President’s Choice private-label brands. The idea is to reduce operating costs and pass savings on to consumers in a variety of ways, including a limited assortment, no refrigeration, reduced store hours and limited marketing.

When the No Name banner launched, Loblaw president and CEO Per Bank said since inflation took off, the company has been “laser-focused on doing what we can to keep prices lower for customers,” including opening more discount stores.

Loblaw is also keenly aware that the allure of discount shopping extends beyond those watching their wallets.

“Discount stores appeal to everyone, regardless of their grocery shopping budget. That hasn’t changed a lot. However, in recent years, we have definitely seen a bigger shift to discount stores,” a Loblaw spokesperson said in an email to Canadian Grocer. “As the demographic makeup of Canada continues to change, we’re adapting and making sure that we tailor the assortment of each store so that it reflects the diversity of the community it serves.”

Metro, which operates two discount banners—Food Basics in Ontario and Super C in Quebec—is also expanding its discount network. In its latest fiscal year, the company opened four new Super C stores and converted three Metro locations to the Super C banner. Fiscal 2025 is looking similar, according to Metro spokesperson Geneviève Grégoire. Meanwhile, Food Basics recently opened a store in Petawawa, marking the discount banner’s 145th store in Ontario. In the third quarter, Metro reported 3.5% sales growth; on an earnings call with analysts, president and CEO Eric La Flèche said the growth was primarily driven

by sales at its discount banners. “Conventional is under pressure in [Quebec and Ontario], no question about that,” he said. “When we combine discount and conventional, we’re seeing some market share and tonnage gains.”

Empire, which operates discount banner FreshCo, is looking ahead to full-service taking back more market share. “We believe that the gap between full-service and discount same-store sales will continue to close as the economy improves, which will be advantageous to us as we continue to lean into our strengths as a full-service grocer,” said Michael Medline, president and chief executive officer of Empire and Sobeys, on the company’s earnings call in September. However, Empire is still betting on FreshCo, with Medline saying, “We like our discount banner … It’s been a home run for us.”

PRICE IS KING, BUT PERCEPTION IS EVERYTHING

The question is, can discount banners win on price alone, or do other factors influence their success? “Our research continues to show that price is paramount,” says Caddle’s Hawley, adding that convenience and perceived value are also important. “If you don’t put price first and foremost, and consumers don’t think they’re getting value, then you’re going to struggle.”

Amar Singh, senior director at Kantar Retail, agrees that one of the main success drivers for discount stores is the perception of value. In addition, discount stores have shed their reputation for offering lower-quality goods in less-than-appealing shopping conditions.

“The brand profile of discount stores has improved tremendously over the past few years,” says Singh, adding that the shopping experience is often on par with conventional supermarkets. “If you go to a high-end No Frills that’s well-lit, clean and has good signage, it’s akin to any decent supermarket now,” he says. “If you need a limited number of products and have a defined basket … week after week, the discount store does a good job. The supermarket is where you can buy additional items you can’t access at your discount store.”

Moreover, Singh points out that if shoppers can buy the same private-label products at discount stores as in conventional stores, they’re likely to make that switch.

“Just as consumer perceptions of private-label products have improved, their perceptions of discounters have also improved,” Singh says.

DOLLAR STORES SHAKE UP THE GROCERY LANDSCAPE

As retailers continue to evolve and expand their discount offerings, grocers have another player to contend with: dollar stores. Dollarama, in particular, has expanded its food assortment in recent years, offering brand name products including bread, cereal, canned goods, condiments, snacks, rice and pasta. In September, Dollarama reported a second-quarter profit of $285.9 million, up from $245.8 million in the same quarter last year. On a call with analysts, CEO Neil Rossy said grocery “is just one small part of our store,” attributing its strength to its wide range of products.

November 2024 || CANADIAN GROCER 35

Feature

IS DISCOUNT SHOPPING HERE TO STAY?

Looking ahead, if the economy improves and the cost of living stabilizes, will Canadians continue to embrace discounters, or will they revert to their former shopping habits? For the next few years, at least, it appears discount will be king. “In our forecasting at Kantar, the value channel, which includes all the discount grocers, Dollarama, Dollar Tree and Giant Tiger, are going to outpace the category average of all other channels,” says Singh. “So, the value channel is going to be the fastest growing through 2029.”

Hutcheson agrees, predicting sustained growth for the discount category. “The economy is not looking to improve greatly, although it has some glimmers of hope,” she says. “People are becoming very price-sensitive and they’ve educated themselves [about food prices].” Even if some go back to the way they used to shop, Hutcheson says, “while the economic uncertainty is here, saving money is at the forefront of consumer behaviour.”

Hawley suggests if a shift away from discount happens, it will take time as more Canadians have learned the value of savings by shopping at discount stores and price matching. “Once people understand how much they can save, it’s hard to go back,” he says. “For the foreseeable future, I see the discount channel continuing to win.”

36 CANADIAN GROCER || November 2024

Can Aldi and Lidl be wooed?

“Will they or won’t they?” For years, grocers, analysts and consumers alike have been asking about the chances Germany-based “hard discounters” Aldi and Lidl will set up shop in Canada. Aldi operates more than 12,000 stores worldwide, including more than 2,300 locations in the United States where it continues to expand.

Lidl also has more than 12,000 stores globally, but significantly fewer in the United States at around 170. Both discount retailers focus on private-label products and smaller assortments than traditional supermarkets.

The question of a Canadian expansion was reignited last year when a Competition Bureau study concluded that more competition in Canada’s grocery industry is needed to bring prices down.

The report noted that in other markets, “the expansion of discount grocers like Aldi and Lidl has created significant benefits through lower prices and greater choice.” This past April, the Wall Street Journal reported the federal government was reviewing a list of 12 potential international grocery chains that could expand to Canada and create more competition, and Aldi and Lidl were on the list.

While the government may be keen to bring in a foreign competitor, analysts don’t see it happening anytime soon. “In Canada, we have very welldefined, consolidated discount grocers,” says Kantar’s Amar Singh. “That’s one reason it’s hard for any entrant to come into Canada and challenge them because they’re such well-established [retailers] with strong shopper loyalty and defined supply chains.”

Retail consultant Carol Spieckerman sees more of a likelihood of foreign discounters coming to Canada.

“I would go so far as to call it an inevitability because they naturally have to continue to expand,” she says. “Even so, it may take a while because Aldi believes they have a lot more growth potential in the U.S. ahead of them. And that’s the most logical thing to do.” CG

SHUTTERSTOCK, PEPPY GRAPHICS

However, there’s no doubt Dollarama is having an impact on the grocery landscape. Hutcheson of J.C. Williams Group says in addition to the pace of growth in the discount grocery channel, “we’re seeing Dollarama all of a sudden weaseling in there.

They’ve had great results and are opening stores in markets that grocery wasn’t previously in and taking some market share.

We’re starting to see people look to Dollarama and Giant Tiger as a grocery option for non-perishables, particularly. I think retailers are saying, ‘uh oh, we’d better pay attention, and we need to maintain our market share.’”

Research from Caddle shows more Canadians are, indeed, buying grocery items from the dollar channel. “Canadians are picking up more items at dollar stores and including them as part of their [overall] shop,” says Hawley. Since many food items at Dollarama come in smaller units than what’s sold in grocery stores, “it’s not necessarily the best value, but it’s the lowest price,” he says.

U.S.-based retail consultant Carol Spieckerman is watching Dollarama with interest. “Dollar General, the big player here, has been investing heavily in grocery and continuing to expand into other categories, yet they’ve seen some concerning numbers and decreases in momentum that they had going for quite some time,” Spieckerman says. “In contrast, to see the recent numbers out of Dollarama, it makes you wonder if Dollarama is doing something different, or if there’s going to be a lag effect where Dollarama also, in time, will start to see a slowdown.”

However, she adds, the success of concepts such as Dollarama stems from diversification. “They have the ability to expand into non-grocery and pump-up profits and get higher margins. So, they can be more opportunistic than pure-play grocers.”

In the United States, Aldi employs a similar strategy with its centre-row aisles of cheap, non-food merchandise. “Even though Aldi is very focused on grocery, they have those treasure hunt aisles, and that’s their way of trying to grab more margin outside of grocery and keep that treasure hunt vibe going,” says Spieckerman. “Aldi can increase the number of visits in that way—it brings people in beyond shopping for groceries every week.”

The ACTION: In 2024, we installed solar panels on our grading stations and farms in Southern Ontario.

The GOOD: We expect to harness enough power to sustain approximately 65 average households every day, reducing our energy consumption up to 26%*

Taking local action for the greater good.™

*At the Gray Ridge Strathroy Grading Station

© L. H. Gray and Son Limited, 2024

Winner, 2024 Canadian Grocer Impact Award Sustainability Category

LEADERSHIP TIPS FROM AN EGG INDUSTRY VETERAN

L.H. Gray & Son’s Bill Gray on leading a family-owned business, cultivating loyalty and always evolving

By Rosalind Stefanac Photography by Jaime Hogge

AT

90 YEARS in business and still a major player in Canada’s egg industry, L.H. Gray & Son is obviously doing something right.

Owner and CEO Bill Gray will say the company’s secret to success is a combination of dependable service, reliable supply and satisfied customers. But, as his track record proves, so is having an owner passionate about the egg industry, who values his employees and isn’t afraid to evolve.

Gray, who took over the family operation from his father in the late 1960s, says his experience in all aspects of the business provided the best kind of training to be a successful leader. “My parents started from humble beginnings and as they grew the business, I was part of that growth, too,” he says, adding that he was already grading eggs at the age of 10. Later on, Gray says he performed any task required, from driving trucks, picking up chickens and so on—nothing was beneath him.

Being involved in all aspects of the company also gave him a clearer understanding of the complexities of the egg industry in Canada. “There is a different culture in the farming community 38 CANADIAN GROCER || November 2024

than there is in the sales end of the business dealing with retailers, so it’s important to understand all sides,” he says. As a result, Gray was often out in the field talking to people to better understand what it takes to attract egg producers and keep retailers happy. “We have a philosophy here that you can’t run a business from 40,000 feet up, and so we’ve never done that,” he says.

This kind of hands-on leadership style has been pivotal in helping cement the company’s reputation for being able to meet customers’ needs. “We’ve been a supplier of Loblaws continuously since 1950 and deal with just about all the major retailers now,” says Gray. “We’ve had buyers for more than 85 years … and we continuously strive to build our credibility with customers.”

Even in acquiring dozens of companies over the years, Gray says he’s always prided himself on treating people well. This not only helped him keep his good reputation intact, he says, but improved his chances of being the one people thought to contact when they wanted to sell their businesses.

THE KEY TO CULTIVATING LOYALTY

That there are employees who have worked at L.H. Gray & Son for 40-plus years speaks to the company’s understanding of how to attract good people—and keep them engaged. “For me, communication is key as I want to know what people are thinking and where they are at … and it’s really important to listen more than speak so people feel they have the opportunity to give direction on where they want to go,” says executive vice-president Scott Brookshaw. “You may not always go with that direction, but at least you can tell them why.”

He says helping employees feel empowered is something he always strives to do. “We have people who started on the floor packing eggs and are now running health and safety,” says Brookshaw, who himself once worked on the ground with producers and now oversees operations across the company. “I’ve stayed around for 27 years because I’ve grown with the business.”

In fact, one of the benefits in working for a family business, he says, is having opportunities to drive growth once the head decision-makers are confident in your abilities. “In family businesses, there is often one person at the top and they have to be willing to look at other points of view to make the best decisions,” he says. “You may not always agree, but you’ll talk about it and come to a consensus.”

Senior vice-president of sales and marketing Sean Mateer, who left a more corporate setting in the food industry to join L.H. Gray & Son in 2019, also appreciates being able to bring new ideas to the team at any time. “We have our budgets, but if there is an opportunity that doesn’t fit the budget, we don’t have to wait until next year to talk about [it],” he says. “If it makes sense, we can make a decision and go.”

With 1,200 employees across three provinces (Ontario, Alberta and British Columbia), cultivating a positive workplace culture also means ensuring there is mutual respect regardless of roles, says Brookshaw. “We all respect each other, from the person sweeping the floor to the president,” he says. “Your voice on the floor is as important as the one in the boardroom in my opinion, and Bill would share that.”

With a diverse workforce working in food production often doing the same tasks day in, day out, it has been essential to keep people excited about coming into work, whenever possible, says Brookshaw. That means celebrating various cultural holidays and

Feature

L.H. Gray & Son’s senior vice-president of sales & marketing Sean Mateer (left) with founder and CEO Bill Gray

making efforts to instil some fun, such as a party and presents for employees’ children at Christmas or giving them turkey dinners and gift certificates for the holidays. “Ten years ago, we would have worked Thanksgiving Monday and today we don’t,” he says.

“We figure out what we need to do to ensure people can have that day with the family—it will cost us, but it creates a much better environment for people to want to work in.”

EVOLVING MEANS NEVER STANDING STILL

In dealing with COVID-19, Avian flu and other challenges that have negatively impacted the egg industry over the years, Gray says his company’s strong relationships with suppliers and retailers—along with a willingness to keep innovating—have been essential in finding solutions. When restaurant closures during the pandemic resulted in a surge in egg supply and shortage of egg cartons, for example, the team was able to quickly source larger egg trays for its retail customers that are still popular among consumers even now. Similarly, when the Avian flu hit British Columbia, the company could pull from assets in Alberta and Ontario to keep the egg supply going.

“Yes, there have been difficult times, but nothing we couldn’t handle,” says Gray. “This is a competitive industry, but our reputation is everything and we’ve managed to find ways to supply our customers … and our customers have rewarded us for that in terms of being able to grow our business.”

The team’s willingness to stay ahead of the curve with technology—whether investing in plants and trucking fleets to improve efficiencies or scoping out the latest technologies in egg production—has been another asset in staying relevant throughout the decades.

“There have been advancements in the egg industry that we have been a big part of,” says Gray, citing the vast expansion of egg varieties over the years now available to consumers in the grocery store. “We have a philosophy here taught to me many years ago that if you’re standing still, you’re going behind—and we have not stood still, believe me.”

Going forward, there will be more growth and more innovation, but never at the expense of good customer service, says Gray. “Supporting local supply and building a sustainable future is always important to us.” CG

November 2024 || CANADIAN GROCER 39

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A growing market for macadamia nuts

The Canadian market for macadamia nuts is experiencing growth driven by evolving consumer preferences for nutritious, high-quality snacks. According to Innova’s 360 research, 32% of consumers in North America snack on healthy options daily, and a 2023 Nielsen IQ report shows that 73% of Canadians prioritize products with health benefits when choosing snacks. In addition to snacking, macadamia nuts’ versatility makes them a popular ingredient in both sweet and savoury dishes and their unique flavour profile aligns with the growing diversity in Canadian cuisine, providing opportunities for retailers to introduce them in various food categories. As an increasingly popular choice for snacking, baking and culinary uses, macadamia nuts are a valuable product to stock throughout the year for consumers seeking both exceptional taste and health benefits. Hawaii-grown macadamia nuts are available for bulk and retail sale in Canada and brokers and retailers can request product information and samples online at www.hawaiimacnut.org/canada.

Balancing nutrition and flavour Canadian consumers are looking for snacks that balance nutrition, flavour and sustainability. Hawaii-grown macadamia nuts perfectly meet these needs, offering a rich, buttery flavour alongside heart-healthy fats and antioxidants without excessive sugars.

While demand spikes during the holiday season due to their role in gifting, baking and special occasions, their year-round appeal is growing as more Canadians recognize their nutritional value.

A commitment to sustainability Hawaii macadamia nuts offer year-round freshness and are known for their rarity—macadamias make up less than 2% of the world’s tree nuts, with Hawaii producing only

a small fraction. The volcanic soil and perfect climate of Hawaii contribute to their distinctive, creamy texture and buttery taste, setting them apart from other tree nuts or macadamias. Hawaii-grown macadamia nuts are particularly appealing because they’re grown in ideal conditions using sustainable farming practices, including water conservation and minimal pesticide use. This aligns perfectly with the increasing demand for ethically produced and environmentally friendly products.

Boosting sales of macadamia nuts Innovation is deeply rooted in Hawaii's tradition, as it was the first place in the world to plant macadamia nuts commercially, starting in the 1920's. This pioneering effort led to decades of macadamia research by the Hawaii Agricultural Experiment Station and over a century of dedicated farmers cultivating 100% Hawaii-grown nuts, ensuring constant progress and quality improvement.

Innovation is key to staying competitive and meeting evolving consumer preferences. According to the Hawaii Macadamia Nut Association, “We focus on developing new products and flavours that highlight the natural qualities of the nuts, such as snack packs, chocolatecoated varieties, and new flavour profiles that cater to different tastes. This focus on variety and product development helps retailers offer something new and exciting to consumers. We’re eager to collaborate with Canadian buyers and retailers to maximize the sales potential of Hawaii-grown macadamia nuts. HMNA is driving consumer awareness and demand through targeted marketing campaigns, and we also provide support for in-store merchandising, helping retailers effectively position macadamia nuts as a premium snack and ingredient choice for their customers.”

Top Shelf Picks Two popular products are dry-roasted macadamia nuts with sea salt and unsalted macadamias, also known as "naturals." The dry-roasted option provides a savoury, satisfying crunch, while the unsalted macadamias are perfect for those seeking a low-sodium, versatile snack. Both products cater to current consumer interest in clean, simple ingredients and healthy snacking options.

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SPECIAL PROMOTIONAL FEATURE IN CANADIAN GROCER || November 2024

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TRENDS || TECH || MERCHANDISING || PRODUCTS

PRODUCE TRENDS

WHAT’S NEW IN SPECIALTY PRODUCE? From pawpaws to ‘the new shishito’ pepper, here are specialty fruits and veggies grocers should watch for

IMAGES SHUTTERSTOCK/RAMBUTAN, D_M; DRAGONFRUIT, SAPLNAC; SHISHITO, HORTIMAGES; EXOTIC FRUIT, AGAVE STUDIO

By Rebecca Harris While the produce department takes centre stage in any grocery store, it’s brimming with opportunities beyond the usual apples and oranges. Specialty produce—items that often aren’t staples in major grocery stores or are only available in limited quantities—satisfy consumer demand for unique, new-to-them flavours that often cater to the tastes of ethnic communities. Here’s a look at some specialty fruits and vegetables that can elevate grocers’ offerings.

New twists on citrus: There’s a world of citrus flavours beyond everyday lemons and limes. Kris Kasuya, sales manager at Bondi Produce, is enthusiastic about sudachi, a small, round, green citrus fruit from Japan that looks similar to a lime.

“It has a huge pop of flavour with a super bright citrus profile. It’s sour, but not lemon-lime sour,” he says. Sudachi is added to Japanese recipes such as cold noodle dishes, as well as to dressings and salads.

“It really brightens and refreshes a meal,”

Kasuya says. “I would love to see these make a big push into the retail space and grow in the North American market … It stands out as something special.”

Tropical tastes: Tropical fruits such as jackfruit and mangosteen are on Adri de Wet’s list of popular specialty produce items. The president of Vancouver-based Fresh Direct Produce says East Indian and South Asian consumers are behind tropical fruits’ rising popularity. But, offering these items can also attract “adventurous eaters from other backgrounds who are curious about trying new ingredients,” she says.

Jackfruit is popular as a meat substitute in vegetarian and vegan dishes, de Wet explains. “When unripe, jackfruit has a mild, subtly sweet taste and a texture like that of pulled pork.” When fully ripe, jackfruit becomes sweeter with flavours of banana, mango and pineapple. Meanwhile, mangosteen has a sweet, tangy flavour, notes de Wet. “Its unique taste and

health benefits are drawing interest, and it’s starting to appear more frequently in specialty and Asian grocery stores.”

Another specialty fruit is actually grown stateside: pawpaws. Native to eastern parts of the United States, the pawpaw fruit has a mango-banana flavour and custard-like texture. “It sort of looks and tastes like a tropical fruit, but it grows in temperate climates,” says Jonathan Deutsch, a professor and founding director of Drexel Food Lab at Drexel University in Philadelphia.

At Longo’s, two popular tropical items are tree-ripened mangoes, which ripen in their natural environment and have a juicy texture and sweet flavour, and Honeyglow pineapples from Del Monte, which are extra sweet and have a radiant golden hue. Joe Fusco, Longo’s vice-president merchandising, produce & floral, says the grocer’s buying teams regularly connect with growers to stay on top of new items and are committed to bringing unique produce to its stores.

Get cooking: Canadians can look to speciality vegetables to mix things up in the kitchen. One item that’s currently popular in restaurants is the Jimmy Nardello pepper. “It’s been coined as the new shishito,” explains Kasuya of Bondi Produce. A versatile, sweet pepper, the Jimmy Nardello “can be eaten raw, it can be fried, it can be grilled … And it’s one item you’re going to see pop into retail very soon as a specialty pepper,” he says.

S quash is ano ther cate g or y that doesn’t have to be the same-old, sameold. Koginut squash is a new hybrid of butternut squash and kabocha squash developed by Dan Barber’s Row 7 Seed Company. “They cook really well, so if you’re making soups, they get very creamy when you roast them,” says Kasuya. “They have a super nutty flavour and they’re sweet as well. Like all specialty items, it’s about getting away from the norm and exploring some other options.” CG

November 2024 || CANADIAN GROCER 43

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BITS AND BITES When it comes to snacking, Canadians are committed to good health and the environment

By Matt Semansky

Product trends may come and go and consumer motivations may evolve and change, but no matter what, you can count on Canadians to reach for a little something to bridge the gap between meals.

“The one thing that doesn’t change is that people love to snack,” says Jenny Longo, vice-president, private brands at Longo’s. It’s a perspective backed by research from Statista indicating the Canadian snack market will generate more than US$8.8 billion in revenue in 2024—and grow by more than 5.6% annually through 2029.

While guilty pleasures such as chips and chocolate never seem to go out of style, several trends are adding depth and complexity to the snack landscape and driving innovation. Near the top of the list is a change in the way consumers are parsing out their calorie intake through the day.

“People are not sitting down to the traditional three meals each day,” says Lynsey Walker, director of marketing for the Canadian Health Food Association (CHFA). “They’re looking for snacks to fuel them through their day in a different way.”

Nicole Bleiwas, vice-president of marketing for Riverside Naturals, producer of snack brands such as MadeGood, agrees. “The line between meals and snacks continues to blur,” she says. Bleiwas cites a study by research

November 2024 || CANADIAN GROCER 45

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Aisles firm Circana indicating adult consumers snack 3.5 times per day and children under 18 do so 4.9 times per day.

Afternoon is prime time for snacking, adds Bleiwas, but snacks accompanying or replacing breakfast or in the hours after dinner are also popular.

As with most aspects of consumer behaviour, inflation is exerting pressure on snacking. Research from Innova Market Insights reveals 48% of consumers in Canada and the United States cite personal finances as their top concern. That’s up 5% from 2023. More than half (61%) of respondents also said they noticed rising snack prices, and 37% of those surveyed have sought out cheaper options.

“Inflation and its impact on personal finances are top-of-mind for consumers in the U.S. and Canada, with many adjusting their purchasing behaviour to seek out more affordable snack options,” says Lu Ann Williams, global insights director at Innova Market Insights.

But that doesn’t mean Canadians are compromising on snacks. Experts agree that customers are increasingly seeking brands offering health benefits, responsible global citizenship and affordability— without sacrificing taste.

“There’s a lot going on in the world in terms of global affairs, climate change and issues like that, and people are feeling stress,” says CHFA’s Walker. “Something we’re predicting going into 2025 is consumers looking for moments of joy and sensorial experience of food. Little glimmers throughout the day.”

Here are some trends manufacturers and retailers should consider as they look to provide those glimmering moments:

GETTING HEALTHY: WHAT’S IN Consumers are looking for more health benefits from their food, and snacks are no exception. According to research from Innova, more than half of the global population is willing to sacrifice at least a little bit of indulgence in exchange for snacks that are natural and healthy. Specifically, 61% of consumers in Canada and the United States who look for specific ingredients in their snacks look for protein, while 48% look for fibre.

“Demand for healthy and nutritious snack options has increased 8% since 2020,” says Paul Hogan, general manager for Conagra Brands International, citing 2023 research from Ipsos FIVE.

61%

of consumers in Canada and the United States who look for specific ingredients in their snacks look for protein, while

48%

look for fibre Hogan adds that snackers’ preferences tend to change throughout the day, as they look to products that provide hydration, mental focus and an energy burst in the mornings and afternoons and seek indulgence and comfort at night.

Protein and healthy fats are near the top of the list for customers at Summerhill Market, according to Brad McMullen, co-owner and president of the Torontobased grocery chain. McMullen says Quest Chips—a high-protein, low-carb, low-sugar snack—are strong sellers at his stores. He also reports an uptick in sales of dried fruit, suggesting consumers are looking for a dose of sweetness from a natural source.

Gail Castillo, head of insights, North America for AB World Foods sees ingredients such as seaweed and chickpeas as an indication that international influence and health are intertwined. “If you look at things like seaweed snacks, they’re getting so popular that people are even giving them to their kids.”

GETTING HEALTHY: WHAT’S OUT Innova’s research, however, also suggests that what’s not in the product still carries more weight. In fact, the top two attributes that define “healthy” in the minds of Canadian and U.S. snackers are: no artificial ingredients (39%) and no additives or preservatives (37%). “Consumers in the U.S. and Canada define a snack as being healthy by what’s not in them—no artificial ingredients and no additives or preservatives,” says Williams.

This includes dairy-free, nut-free and gluten-free options, according to Longo.

“We’ve seen an increase in requests for snacking options that are dairy free or allergen free,” she says. Longo lists vegan cupcakes, gluten-free mini muffins and nut-less clusters among the private-label snacks it has developed in recent years.

This is where Peter Higgins, president

at Choxco, sees an opportunity to fill a need. The B.C.-based company produces a line of chocolate cup snacks with various flavoured fillings, with only four grams of sugar and a short-and-natural list of ingredients. “Where we fit in is simple and clean ingredients,” he says. “No artificials of any kind.”

Higgins says past trends towards sugar-free led to a wave of products made with artificial sweeteners, which did not address flavour or health. He says today’s customer doesn’t want to turn away from sugar entirely. “The way we term it is, people are on a sugar budget,” he explains. “This is where the four grams of sugar fit in. I’m not having a chocolate bar with 30 grams of sugar, I’m having a cup that has four.”

SNACKING FOR A CAUSE Canadians also want their snack brands to make a positive impact in the world, particularly when it comes to the environment. A 2023 survey from Agriculture and Agri-Food Canada found 70% of Canadian consumers seek foods that are produced sustainably.

Sustainability is also a priority at Choxco, which has partnered with Repurpose, a company focused on mitigating the impact of plastics. “We’re certified plastic-neutral, so we recover as much plastic from the environment as we use,” says Higgins, adding that Choxco also emphasizes sustainable cocoa farming.

“I think those efforts do resonate with consumers. We all want whatever we buy to represent our values,” he says.

Sustainability isn’t the only cause snackers have rallied around. At Summerhill Market, McMullen says the Purplesful Snacking popcorn brand, which donates 25% of profits to charities that support health, nutrition and education programs for children, is a popular item.

“We’ve had good success with it,” he says.

“It’s a product with a charitable angle that tastes great.”

Yet, CHFA’s Walker warns of a gap b e t we e n i n t e n t i o n a n d c o n s u m e r behaviour. She believes financial factors are preventing shoppers from wielding their purchasing power for good causes.

“We talk about the ‘say-eat gap,’” Walker says. “People say they want to align themselves with responsible brands, but the cost is prohibitive. Being able to close that gap is a place of opportunity.”

November 2024 || CANADIAN GROCER 47

Aisles following taste trends to be influential heading into 2025.

EAST AND SOUTHEAST ASIAN

A WORLD OF FLAVOUR Consumers have a growing appetite for global cuisines, and flavours from Asia and the Middle East are leading the charge

SHUTTERSTOCK/ELENA ERYOMENKO

By Matt Semansky More than ever, Canadian consumers can explore the world at their local grocery store. Over the past several years, factors ranging from the pandemic and inflation to immigration and social media have created a perfect storm for culinary adventure and experimentation—and the result is an explosion of global flavours.

“When it comes to flavour, there seems to be this demand for more,” says Jo-Ann McArthur, president at Nourish Food Marketing in Toronto. “Consumers are looking for food to deliver a more intense experience with every bite.”

Canadians have historically looked to restaurants to find this intensity; however, the stay-at-home restrictions of the COVID years and the subsequent rise in grocery prices have led more consumers to go global from their kitchens. “ D u r i n g C OV I D, p e o p l e we r e n’ t eating out anymore and all of a sudden their cooking abilities went up a couple of notches,” says Gail Castillo, head of insights, North America for AB World Foods, which counts Patak’s Blue Dragon and Tabasco among its brands.

“Now that we’re experiencing inflation, we’re still seeing people come down the

international aisles to save money on going to restaurants or ordering in.”

Consumers are also getting more and more inspiration from social media, as they look to recreate recipes from Instagram and TikTok. “Trends used to start in fine dining and then come down to quick-service restaurants, but now they’re going crazy because of TikTok,” McArthur says. “We’re finding the trends there before they show up in research and Google trend data.”

The underlying driver, of course, is Canada’s diverse population, which now includes multiple generations of individuals who have more than one ethnic background. As consumers look to incorporate all elements of their identity in the kitchen, traditional culinary boundaries are being shattered.

“People want to incorporate everything they’ve experienced culturally into their food,” says Castillo. “You see it on Instagram posts, people mixing Korean with tacos, or butter chicken on pizza.”

For these reasons, nailing down the hottest thing in global flavours is a little like trying to step on one’s own shadow.

But, grocery retailers can count on the

The cuisines of Korea, Japan, the Philippines and Thailand are tantalizing consumers with their blends of spice and sweetness and driving 24% growth in the multicultural food category, according to Paul Hogan, general manager for Conagra Brands International.

Conagra aims to satisfy these cravings with a portfolio that includes P.F. Chang’s line of Teriyaki, Sweet Chili, Sesame and Kung Pao sauces, as well as frozen P.F. Chang’s Home Menu products such as the Broccoli & Beef Skillet dinner, Chicken Pad Thai Bowl and Korean-Inspired Pork Bowl. And AB World Foods’ Blue Dragon brand recently launched Spicy Teriyaki Sauce that can be used for grilling, marinating or dipping.

SOUTH ASIAN Newcomers from South Asia broadly, and India in particular, are driving Canada’s immigration trends. Accordingly, the flavours of the region are influencing products on store shelves.

According to McArthur, a slowdown in innovation from food manufacturers has led private-label brands to fill in gaps in the international food aisle. For example, Farm Boy’s in-house butter chicken and tikka masala sauces, frozen mini samosas and pakoras with tamarind sauce, and canned curry products offer consumers a taste of India. “What we’ve seen is a huge pullback in innovation in CPG,” explains McArthur. “Private label is kind of picking up the slack there.” (Still, products such as Conagra’s VH Butter Chicken Sauce show traditional manufacturers are still in the game.)

MIDDLE EASTERN & MEDITERRANEAN Middle Eastern cuisine is the fastest-rising flavour trend in the country, according to McArthur. Frank Jaja, director of category management & ethnic for Metro and Food Basics, is seeing this play out in the popularity of dairy products such as kefir and labneh, spices such as sumac and za’atar, and dates.

Meanwhile, Mediterranean flavours are favourites with consumers. Spyce Girls Theo the Greek Seasoning, for example, can be used as a rub for meats and as a seasoning for vegetables and potatoes.

November 2024 || CANADIAN GROCER 49

Aisles 4 HEALTH NUT

1 TREE OF LIFE

2 FLAVOUR TAKEOVER

Market research firm Fact.MR estimates demand for pistachios in Canada will advance at a compound annual growth rate (CAGR) of 5.1% over a 10-year period ending in 2033. Global pistachio sales will increase to US$7.4 billion in 2033 from $4.5 billion in 2023, with Fact.

MR attributing the growth of pistachios to “their increasing use as a flavour enhancer.”

“Pistachios are showing up everywhere in our stores,” notes Teresa Spinelli, owner of five Italian Centre Shops in Alberta.

There’s pistachio pestos (brands include Favuzzi, Dolgam and Pisti), pistachio ice cream and 50 CANADIAN GROCER || November 2024

Pistachios Four things to know

By Chris Daniels

gelato (Pinocchio, Sicilian and Fantasia) and pistachio syrups for adding to lattes and other beverages (Monin). “Pistachio ice cream is very popular, and customers call to see if we have pistachio spreads because they frequently sell out,” says Spinelli.

Pistachios are also showing up in the healthy snacks category.

Nomz is a Canadian brand of organic, vegan and gluten-free energy bites coated in a layer of coconut, hazelnut, almond or pistachio. “Our pistachio bites remain a standout—likely due to the novelty of pistachios in the snack space,” says Jana Zaibak, founder and CEO of Nomz, which also makes a pistachio spread.

3 DECADENT MATCH

Offering a combination of salty and sweet flavours, chocolate pieces featuring pistachios enjoyed a CAGR of 57% for wrapped and 47% for unwrapped pieces over a five-year period (July 2019 to June 2024), according to North American tracking from Innova Market Insights.

“Nuts elevate chocolate from a simple indulgence to a luxurious experience, offering a delightful burst of both sweet and savoury notes,” says Lu Ann Williams, Innova’s global insights director. And there’s something even fancier about pistachios compared with other nuts. Perhaps that’s why more than one in four North American consumers favour pistachios as an “emerging flavour” in chocolate confectionery, according to a 2024 Innova survey.

Pistachios are also making their mark in nut spreads. Launches with pistachios in North America jumped 57% between July 2019 and June 2024, according to Innova.

This includes Pistachio Chocolate Almond Butter from Mumgry, a Vancouver-based all-natural nut butter brand that is carried at Vancouver’s Stong’s Market and Toronto’s Summerhill Market.

GETTY IMAGES/FLOORTJE

Living as long as 300 years, pistachio trees produce the greenish-purple nut—which is technically a seed—in grape-like clusters. Native to the Middle East and Central Asia, pistachio trees require little water and can survive extended droughts, making them an ideal crop for a warming planet.

“Pistachios are known for being packed with antioxidants, healthy fats, protein and fibre, and for helping to promote gut health,” says Edward Hilling, senior omni merchant, salty snacks, Walmart Canada. He says Walmart’s 454-gram bag of Great Value private-label pistachios is a top seller in the nut category. “These nutrient-rich nuts are also very versatile for grazing on long car journeys, snacking at home, or enhancing charcuterie or sharing platters,” says Hilling.

Given pistachios are enjoyed as a healthy snack, Michael Catalano, vice-president of sales, Canada for Wonderful Pistachios, recommends retailers cross-merchandise with fresh and dried fruits, “which is one of the reasons you can often find Wonderful Pistachios in or near the produce section.” Its No Shells line comes in various flavours, each with their own coloured packaging. “This invites grocers to display them in a colour-blocking pattern,” notes Catalano. “It’s an eye-catching arrangement that draws shoppers in.” For example, Wonderful’s top seller, Chili Roasted, is in red packaging and Sea Salt & Vinegar, its second bestseller, is in light blue.

New on shelf!

1 CHEERIOS VEGGIE BLENDS For parents looking to sneak some fruits and vegetables into their kids’ diets (or for adults looking to improve their own fruit and veg consumption), there’s Cheerios Veggie Blends, which combine fruit puree and vegetable powder with the cereal’s traditional whole grain oats. It’s available in Blueberry Banana and Apple Strawberry flavours.

2 MANITOBA HARVEST’S COLD PRESSED HEMP CULINARY OIL Ideal for sautéing, roasting, baking and dressings, Manitoba Harvest’s Cold Pressed Hemp Culinary Oil contains eight grams of omegas 3 and 6 per serving and, according to its maker, has 25% less saturated fat than olive oil.

Aisles The latest products hitting shelves

1 2

3 EARTH’S OWN CINNAMON COOKIE DOUGH OAT COFFEE CREAMER A sweet and creamy addition to either hot or iced coffee beverages (or as an addition to French toast mix), Earth’s Own Cinnamon Cookie Dough Oat Coffee Creamer mixes well without separation and is nut free, dairy free and non-GMO. 4 CANADA DRY GINGER BEER Crisp fall temperatures usher in food and drinks with warm, full-bodied spices. Meet Canada Dry Ginger Beer, a carbonated beverage balanced with natural flavours and real brewed ginger for a refreshing yet bold taste that can elevate any cocktail.

5 DAIYA’S REFORMULATED PLANT-BASED PIZZAS Now with a lighter, fluffier and crispier gluten-free crust, Daiya’s line of reformulated plant-based pizza also boasts an enriched, zesty tomato sauce, plant-based meats and dairyfree cheese that has been made using proprietary plant-based cultures. The line includes Cheese Pizza, Meatless Pepperoni Pizza, Supreme Pizza, Fire-Roasted Veggie Pizza, Meatless BBQ Chick’n Pizza and Meatless Meat Lover’s Pizza. CG

4

3 5

November 2024 || CANADIAN GROCER 51

Express Lane

SPACE RACE

PwC’s Fred Cassano on the state of Canada’s commercial real estate market

By Kristin Laird

What is the current state of Canada’s retail real estate market?

PwC together with Urban Land Institute publishes Emerging Trends in Real Estate every year and we sit with 200-plus c-suites that are real estate investors in every asset class to get the pulse of the market. For the last two years, retail had its struggles. But last year, retail was our shining star in the publication based on various factors: omnichannel distribution, strategic partnerships and [increased need for] grocery-anchored retail in growing communities and in the downtown core. The market is seeing increased demand for retail space.

Small-format stores and boutique food halls are gaining popularity. Shopping centres are being redeveloped to cater to luxury goods and boutique experiences.

And, while high construction costs and interest rates are slowing new retail development, overall sentiment remains positive with a resurgence in foot traffic and leasing activity. Certainly, growth 52 CANADIAN GROCER || November 2024

in immigration compared to the supply of grocery stores has also contributed to the demand … we still don’t have enough retail space per capita. If immigration continues to increase, we have more people needing grocery-anchored retail.

We’ve heard from grocers that real estate is hard to come by. Doesn’t sound like that’s the case.

While the grocery real estate market is facing challenges due to restrictive property controls by major chains, we are still hearing there have been a lot of vacancies, especially for new condo ground floor units and the leases are for attractive rents. So, there is availability.

How should grocers search for space?

That’s a very good question. What we’re seeing is larger institutions such as REITs (real estate investment trusts), large corporations or government agencies that hold commercial assets divest from retail. These institutions often engage in divestiture to streamline operations, raise cash, reduce debt, or focus on core business areas. For grocers looking for retail space, these divestitures represent opportunities to acquire properties these institutions are offloading.

Shopping centres are a lso viable as landlords seek grocery tenants and may consolidate smaller spaces. Emphasizing small-format stores caters to consumer preferences for convenience, while incorporating community areas like cafés or bars enhances customer experience and boosts foot traffic.

The Competition Bureau is investigating the use of restrictive real estate clauses in the Canadian grocery sector. Is it hampering competition?

Yeah, I think it’s hampering competition ... These clauses limit the types of stores that can open nearby and create barriers for new entrants, reducing market competition. I understand the Bureau suggesting limits or banning such clauses to improve market conditions.

How will demographic shifts or changes in consumer behaviour impact retail space in the long term?

Population growth in urban centres due to high immigration rates is increasing demand for space. Preferences are shifting towards service-oriented and experiential retail, such as health and wellness services and luxury brands. Inflationary pressures are boosting the popularity of discount retailers and grocery stores.

Limited new construction is leading to rising rents and low vacancy rates, pushing retailers to consider suburban locations and mixed-use developments.

There is a growing trend of grocery stores partnering with entertainment complexes to attract younger consumers who value experiences. By situating grocery stores near entertainment venues like gyms, retailers can offer convenience and capitalize on the desire for quick, healthy meal options post-activity. And, the aging population in Canada is driving demand for senior-friendly retail spaces. There is an increased need for accessible retail environments. CG

PWC

RETAIL IS RESILIENT. Though it was one of the commercial real estate sectors that suffered most during COVID19, demand for space is on the upswing, buoyed, in part, by strong population growth and greater demand for necessity-based shopping. We asked Fred Cassano, partner, national real estate leader at PwC, to give us the lay of the land (pun intended!) to outline demographic shifts that could impact retail space in the long term. This interview has been edited for clarity and length.

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Printed in Canada

Bread.......................................................................

Breakfast .................................................................

Coffee .....................................................................

Coffee Creamers .................................................

Culinary Salt.........................................................

Eggs .......................................................................

Fresh & Deli .........................................................

Frozen Foods.......................................................

Peanut Butter.......................................................

Plant-Based Beverages...................................

Protein Snacks....................................................

Salad Dressings .................................................

Specialty Foods .................................................

Yogurt ....................................................................

FEED WHAT NOURISHES YOU

BREAD Commercial Bread is $3.4 billion in sales1 in the last 52 weeks (ending August 10, 2024) with sales growth of +1% and gaining $29 million in Canada. Commercial Bread is a large grocery category and plays a significant role at retail with a high household penetration of 97%2. Higher Health—comprised of grains, rye, dietary needs (weight management, no fat, no sugar, gluten free) and organic breads— is the largest segment in Commercial Bread with almost a 19% dollar share, followed

by White Bread at 18%, Buns & Rolls at 18%, and Breakfast at 15%. These four major segments account for 70% of the Commercial Bread category.

Higher Health is the segment that supports consumers’ growing awareness and demand for healthy, nutritious and “better-for-you” products.

Sources: 1. NielsenIQ MarketTrack National Incl NFLD GB+DR+MM L52W period ending August 10, 2024 2. NielsenIQ Panel data National Total Outlets L52W period ending June 15 2024

INNOVATION KEY GROWTH DRIVERS Established Branded Items

New Items/Innovation

Commercial Bread

Higher Health

White Bread

Wheat Bread

Breakfast

Buns & Rolls

Flatbread

Specialty

Source: NielsenIQ MarketTrack BRANDED ONLY L52W period ending August 10, 2024

NEW PRODUCT INNOVATION

COMMERCIAL BREAD SEGMENTATION $ Share (Growth %)

Commercial Bread = 100 (+1%)

Specialty

Higher Health

Flat Bread

Breakfast

plays a key factor in category growth and innovation is coming from all segments within Commercial Bread.

White Bread

Buns & Rolls

Wheat Bread

Source: NielsenIQ MarketTrack L52W period ending August 10, 2024

CATEGORY CAPTAINS

5

BREAKFAST Breakfast habits in Canada are shifting in the wake of the pandemic. Skipping breakfast is becoming more common, particularly among younger adults, with more than one in five Canadians acknowledging a tendency to skip this meal. In contrast, families with children continue to prioritize breakfast, presenting opportunities for retailers and brands.

Currently, 81% of breakfast occasions are sourced from home, with an increase in carriedfrom-home options (+1% vs. 2022) among work commuters. Traditional breakfast staples like eggs, sliced bread, and ready-to-eat cereals remain popular, showing strong ongoing performance. Brewed coffee remains the primary breakfast beverage, however, there has been growth in the consumption of specialty hot coffee and hot chocolate.

The top motivators for breakfast choices are the need for physical energy, hunger satisfaction, and ease of preparation. Consumers of all ages are increasingly seeking ultraconvenient breakfast options that take less than 15 minutes to prepare, favouring portioned and portable choices. Given breakfast is the most important meal of the day, brands and retailers have ample opportunity to grow by addressing evolving consumer preferences and emerging trends.

Source: Ipsos 10th Edition of Consumption Habits and Attitudinal Trends, Dec. 2023

TOP FOOD AT BREAKFAST

TOP COMMERCIAL BEVERAGES AT BREAKFAST Pt. Chg. v. 2022

Total Population

Eggs Fresh Fruit Sliced bread/toast RTE cereal Cheese Yogurt Hot cereal All other breads Bagels Bacon Muffins Waffles/pancakes Croissants/biscuits Buns/rolls Bars

0.3 -0.7 1.1 0.2 -0.6 -0.4 0.2 1.0 -0.6 -0.5 0.7 0.0 -0.1 0.5 -0.1

Source: Ipsos FIVE R12ME August 2023 – % Occasions Based on Total Foods consumed at Breakfast, Indexed to Total Population

Hot brewed coffee Milk and dairy alt.

Dairy milk Plant based beverages Fruit/veg juice/drink Hot tea Flat bottled water Specialty hot coffee Hot chocolate Carbonated soft drinks Iced/cold coffee Smoothie Sparkling water Iced tea Enhanced water

0.5 -2.4 -3.1 0.3 -2.3 0.4 1.0 0.7 0.5 -0.3 0.0 0.4 0.1 0.1 0.1

Source: Ipsos FIVE R12ME August 2023 – % Occasions, Indexed to Total Population

BREAKFAST OCCASION VENUE

Pt. Chg. v. 2022

Total Population

-1.4

Sourced from home Carried from home Sourced from restaurants Sourced from HMR/AO

Pt. Chg. v. 2022

Total Population

+1.0

+0.6 -0.2

Source: Ipsos FIVE R12ME August 2023 – % Food/Comm Beverage Occasions, Indexed to Total Population

CATEGORY CAPTAINS

7

From the time brewing begins.

COFFEE The coffee category has seen continued value growth over the past year, fueled by the rising demand for instant coffee, espresso capsules, and ready-to-drink beverages across grocery stores, drugstores, and mass merchandisers. While traditional coffee and K-Cup® pods remain key stable segments, meeting consumer needs for innovation1, sustainability2, and affordability1 is critical for driving further expansion. Over the last 52 weeks, larger K-Cup® pod formats have gained popularity as consumers navigate economic pressures and tighter budgets. The latest Coffee Association of Canada study reveals that many are stocking up on coffee to manage inflation3. Highlighting sustainability and promoting value-driven messaging will help unlock additional growth opportunities.

Sources: 1. Shopper Intelligence, Coffee Category Decision Factors Importance, 12 months ending Q1, 2024.

2. Mintel, The Sustainable Consumer, Canada, December 2023.

3. Coffee Association of Canada, Coffee drinking trends, (n=1,503), December 2023.

COFFEE ANNUAL VALUE

Total Coffee Annual Value $2,661M / +6%

K-Cup® Pods

Coffee Disc

Espresso caps

Traditional Ground

Traditional Beans

Instant

Ready to Drink Coffee

Source: Nielsen NATIONAL EX NFLD GB +DR +MM, L52W period ending June 15 2024 , Espresso Caps are compatible Nespresso capsules sold at retail.

COFFEE SHOPPER BEHAVIOURS

of consumers are stocking up on at-home coffee when it’s on sale.

of consumers started buying larger packages of at-home coffee to save money

Source: Coffee Association of Canada, Coffee drinking trends, (n=1,503), December 2023

RISING INFLUENCE OF YOUNGER COFFEE DRINKERS (16-34 yrs.)

This group is more likely to make unplanned purchases, with

of them indulging in spontaneous buys.

Source: 2023 Q4 Shopper Intelligence Grocery Survey, Decision factor importance rank 1 to 10

CATEGORY CAPTAINS

9

TRY COLD FOAM AT HOME

* C

COFFEE CREAMERS Consumers seeking to replicate an out-of-home coffee experience are fueling the growth of Flavoured Coffee Creamers (+7.4%), ranking as one the fastest growing categories within the Refrigerated Dairy case in the last 52 weeks.2 Refrigerated Coffee Flavourings are fueled by strong growth within the Traditional Segment +4.9% dollar sales driven by dollar sales per Point of Distribution growth of +9.1% and Large format (>1L) growth of +16.7% in the last 52 weeks.2 Refrigerated Plant Based Creamer’s momentum continues as the segment grew at +7.3% in the last 52 weeks.2 Creamers performance is supported by the growth of Barista Shelf Stable Creamers, posting gains of +11.5% in the last 52 weeks on increased TDP’s of +4.6%.2 Category growth is aided by new occasions created through innovative items such as Cold Foam Creamer, introduced to the market in February 2024, the segment has secured a 3.4 dollar share of the Total Refrigerated Coffee Creamers & Flavourings in the last 12 weeks.2 Cold coffee drinks (Cold Brew & Iced Coffee) continue to create excitement with portfolio innovation and increased awareness fueled by a rise in distribution points across all channels. Cold Brew, in particular, has posted category growth of +27.2% in the last 52 weeks. Despite the growth of RTD and multi-serve RTD cold coffee, 30% of consumers reported drinking more hot coffee compared to last year, driven by Gen Z and Millennials paving the way for continued coffee creamer growth.1 Sources: 1. Coffee & RTD Coffee Report – US – 2024, Mintel, 2024 2. Nielsen, MarketTrack, National Incl. NFLD GB+DR+MM L52W period ending September 7, 2024

HOUSEHOLD PENETRATION

4

% of household penetration

Source: Nielsen, MarketTrack, National Incl. NFLD GB+DR+MM – L52W period ending September 7, 2024

SEGMENTATION & SHIFTING Dollars

Dairy Cream

Coffee Creamers & Flavourings

Plant-Based

L52W Growth:

L52W Growth

L52W Growth

Traditional

L52W Growth:

Source: Nielsen, MarketTrack, National Incl. NFLD GB+DR+MM – L52W period ending September 7, 2024

CATEGORY CAPTAINS 11

NEVER, EVER BLAND And always fine, coarse or grindable.

CULINARY SALT Culinary Salt is a well-established staple category in Canada, reporting $59MM in annual sales. The category reported some decline during the pandemic, but recovered fully in 2023, showing +14% growth vs. the previous year.

• There are seven main segments in the Culinary Salt Category with Sea Salt, Table Salt and Pink Salt being the main segments, representing over 75% of the total market share.

• Sea Salt (+5.4%) and Pink Salt (+2%) are the fastest-growing segments, reflecting rising consumer interest in natural and unprocessed food products along with awareness of the benefits of sea/pink salt.

• On average, Canadian consumers purchase two different types of culinary salt per year.

Source: Culinary Salt U & A Study, 2024

TYPES OF CULINARY SALT PURCHASED IN PREVIOUS 12 MONTHS/MOST Table

Sea

Pink

Kosher

Pickling

Seasoned Salt

Salt Substitute

Source: Culinary Salt U & A Study, 2024 Q10. Which of the following types of culinary salts did you buy for your household in the past 12 months? Base: Gen Pop (n=2481)

CULINARY SALT MARKET SIZE, $ SALES Year-Over-Year Growth

$ SHARE AND VARIATION BY SALT SEGMENT Sales $ Share by Segment

Substitutes Pickling

Seasonings

Kosher

Pink

Other

Table

Sea

Source: NielsenIQ, NAT GB+DR+MM, latest period ending May 18, 2024

CATEGORY CAPTAINS 13

Because Naturally Golden Yolks matter.

Give your consumers the Naturally Golden Yolk eggs they’re asking for.

Only from Conestoga Farms Our local Ontario farmers feed their hens marigold extract, a natural source of lutein for healthy vision, so you can target both the foodie and the nutrition-conscious consumer.

Because Why*?

Top Free Run Eggs in Ontario:

Free Run Omega-3

#1

Because free run eggs are driving specialty

egg sales growth significantly over regular eggs

Because Conestoga Farms eggs lead

#2

free run egg $ and unit growth, making up 53% of all free run sales

Because Conestoga Farms eggs are

the top 3 performing free run egg skus, accounting for 70% free run sales1

Free Run Omega-3

#3

NEW Family Pack for value

Produced by local Ontario farmers.

For more information, contact us at

www.ConestogaFarms.com/ContactUs

*Source Nielsen IQ – Ontario GB+D+MM – 52 Weeks Ending May 18, 2024 1Among National brands ©Gray Ridge Eggs, Inc., 2024

EGGS In Canada, Eggs in all forms (Shelled, hard boiled, liquid and liquid replacement eggs) is a $1.5B dollar category1. Mature categories rarely generate significant growth yet Canadian consumers have increased total Egg sales by $111.8MM (+8%) vs the same time last year. The value added segments are also contributing to total egg growth (Figure 1).

Shelled Eggs are the largest segment accounting for 97% of total Egg sales and growing +8%.1 From coast to coast, Shelled Eggs are generating more revenue for retailers. (see Figure 2) It is important to understand segment development for the east vs west to address regional consumer demands.

More households are purchasing Shelled Eggs (buyers +2%) and those households who purchased last year are spending more ($’s per HHLD +5.8%).2 (see Figure 4) This trend isn’t surprising as consumers are looking to larger pack sizes in the category to find value. Both 18 Packs (+13%) and 30 Packs (+33%) have increased their share of Eggs significantly vs year ago.1 Although Conventional Eggs (no additional claims) make up the largest share of Shelled Eggs (76.8 dollar share & +9%), Specialty Eggs have been growing significantly as well (23.2 dollar share & +6%).1 Free Run Eggs have been a primary driver of Specialty Eggs growing +14% vs year ago.1 This trend is positive for building bigger baskets in the category as Specialty Eggs retail at a higher price per unit vs Conventional Eggs. (see Figure 3) Optimizing the category requires keeping up with trends on larger packages while offering a strong range of specialty products.

Sources: 1. NielsenIQ - National EXCL NFLD GB +DR +MM - L52W Period Ending May 18, 2024 2. NielsenIQ – National All Channels - L52W Period Ending May 18, 2024

FIGURE 1 - $ % Chg vs YA

FIGURE 2 - $ Sales, $ Share and $% Change

NATIONAL

WEST

Shelled

Pickled

Source: NielsenIQ - National EXCL NFLD GB +DR +MM L52W Period Ending May 18, 2024

Eggs Conventional (Non - Specialty)

Eggs Specialty- Free Range Eggs Specialty - Free Run Eggs Specialty - Omega

$ Share:

QUEBEC

$ Share:

BC

All formats: 6s, 12s, 18s, 24s, 30s Total Eggs

Change: 8%

FIGURE 3 - AVG UNIT PRICE

Eggs Specialty

$ Share:

Liquid & Replacement Eggs

ONTARIO

$ Share:

Change: 7%

Change: 9%

ALBERTA

$ Share:

Change: 9%

Change: 10%

MARITIMES

$ Share:

Change: 10%

MAN/SASK

$ Share:

Change: 11%

Change: 9%

Source: NielsenIQ - National GB+D+MM L52W Period Ending June 29,2024

FIGURE 4 - SHELLED EGGS

Eggs Specialty - Organic Source NielsenIQ - National EXCL NFLD GB +DR +MM L52W Period Ending May 18, 2024

$ % Chg

% Chg in Hhlds

% Chg in $/buyer

% Chg in $/Trip

% Chg in Trips / Buyer

Source NielsenIQ – Homescan - National All Channels - L52W Period Ending May 18 2024

CATEGORY CAPTAINS 15

Bringing Elevated Food & Beverage Experiences to Canadians End to End Solution.

Who We Are.

The Tree of Life Advantage At Tree of Life Canada, we are curators of unique brands, bringing elevated food and beverage experiences to Canadians. We manage brands spanning all categories including cheese & deli, specialty, natural & organic, food service, HMR, bakery and frozen.

Tree of Life is a division of KeHE Distributors.

- 4 warehouses across the country - 700k+ square feet.

- 150+ retail and food service sales team members.

- Strategic brand building, trade spend management.

- DSD, WHS, Direct, Cross-dock, DSD 3PL, 3PL. - Demand planning, trade marketing, and actionable insights.

Import &

National Reach,

Tailored Brand

Logistics

Local Approach

Experience

Your end to end solution! We manage inbound freight, foreign exchange, and import from over 30+ countries & growing.

150+ retail and food service sales team members who service retail head offices and take a personal approach to store door sales.

A 360 degree approach to brand building. Our brand and supply chain experts tailor your brand strategy and provide market insights to align with your business goals.

Get In Touch.

French: 855 506 2727

6185 McLaughlin Road

English: 833 640 8733

Mississauga, ON, L5R 3W7

www.treeoflife.ca

FRESH & DELI Canadians take their cheese seriously, with 86% saying that cheese is a planned purchase.1 Packaged cheese is by the far the largest segment within the category, representing a 60% dollar share or $3B and growing at +5%.2 Most consumers are making their cheese purchases at grocery stores – with an even split between channels: 48% of consumers buy at conventional grocery and 47% buy at discount. Within the grocery store, most consumers are purchasing from the dairy section, however 1/3 are also purchasing from the deli counter and another 1/3 are purchasing from dedicated cheese counters.3 • Expanded occasions – the versatility of cheese will be its winning factor. The vast array of domestic and imported varieties fulfills all need-states and occasions.

• Familiar flavours – flavoured cheeses are an important segment to the category, but consumers’ will reach for familiar flavours before unique flavour innovation. Familiarity is a safe buying strategy, especially for specialty cheeses.

• Variety for occasion – cheddar continues to hold a large share of our fridge deli drawers, but expanded knowledge has consumers trying different varieties. Domestic artisanal brands are showcasing stellar cheeses. Meanwhile, access to imported cheese varieties from abroad allows for global exploration.

Cheese has not been immune to ongoing pricing concerns, but the pièce de resistance of this category is its flexibility between nourishment and indulgence.

Sources: 1. Caddle Cheese Shopping Insights, March 2023 2. NielsenIQ, All Channels, Natl L52W period ending Dec 30, 2023 3. Mintel Canada, Cheese, 2022

WHERE CHEESE IS TYPICALLY PURCHASED

81%

Dairy section of grocery stores (ie where cheese is pre-packaged)

32%

31%

Deli counters in grocery stores

Dedicated cheese counters in grocery stores (i.e. sells artisanal cheese)

Base: 1,901 internet users who eat cheese I Source: Kantar Profiles/Nibtel, April 2022

CHEESE TICKS THE BOXES ON BOTH NOURISHMENT AND INDULGENCE

90% agree

Cheese makes meals/ snacks more nourishing

83%

Cheese makes for an indulgent treat

CHEESE PERFORMANCE IN CANADA

$ (000)

$ Change vs YA

Units (000)

Units Chg vs YA

NATURAL CHEESE * EXACT WEIGHT

3,073,162.1

5

433,464.0

1

NATURAL CHEESE * EXACT WEIGHT DELI

909,617.7

6

107,491.0

(1)

CREAM CHEESE * EXACT WEIGHT

353,842.6

9

74,454.3

(0)

NATURAL CHEESE * RANDOM WEIGHT

249,813.7

(7)

7,187.5

(9)

PROCESSED CHEESE SLICES

248,764.4

6

49,873.1

1

COTTAGE CHEESE

144,349.6

18

28,905.9

9

GRATED CHEESE PRODUCTS

100,667.7

(5)

10,524.7

(10)

Source: NielsenIQ, All Channels, Natl L52W period ending Dec 30, 2023 Source: Mintel Canada, Cheese, 2022

CATEGORY CAPTAINS 17

FROZEN FOODS Frozen Food in Canada continues to experience notable growth, with a compound annual growth rate (CAGR) of 7.6% over the past five years, accompanied by a unit growth of 1.3% during the same period. Key factors, including rising inflation, are influencing the growing trend of meals prepared at home, now accounting for 78.8% of food consumption, up from 77.3% last year. Consumers’ desire for convenient yet high-quality meal options has propelled frozen dinners and entrées, the largest subcategory, to grow at an 8.5% CAGR, reaching $2.6 billion in sales.1 Frozen dinners and entrées are favoured by a diverse range of demographics. Millennials and Gen Z, responsible for 41% of frozen food occasions, are drawn to the wide selection of global flavours available, offering culinary adventure without the time and effort of cooking from scratch. For busy families with young children, frozen meals provide quick, nutritious solutions, while frozen snacks and appetizers have become a go-to for snacking.2 Older adults also appreciate frozen foods for their ease of preparation, reliability, and portion control, particularly as they seek balanced meals with minimal effort. At the same time, classic comfort foods continue to play a significant role across all age groups. These familiar dishes provide a sense of nostalgia and comfort, making them a go-to for those seeking warmth and simplicity in their meals.

The Frozen category strikes an effective balance between convenience, affordability, variety, and familiar comfort, making frozen dinners and entrées a staple for a wide array of consumers.

Sources: 1. Nielsen, National All Channel L52W period ending June 15, 2024.

2. IPSOS Canada, 5YR month ending June 2024.

FROZEN FOOD DEPARTMENT PERFORMANCE REPORT Total Frozen Foods

June

June

+8.5% 5-YR CAGR

+7.6% 5-YR CAGR

Dinners & Entrees - Frozen

June

June

June

June

Source: Nielsen, National All Channel L52W period ending June 15, 2024

TOP 10 FROZEN MEALS & ENTREES MOTIVATIONS



Satisfies my hunger Wanted something tasty

Comforting

Could be eaten quickly

Good value for the money

Pack size was right for me

Satisfies a craving

Wanted something all the household members would like

Out of home

Easy to prepare/little or no planning

Wanted something hearty/something to fill up

WHERE FOOD WAS EATEN

At my home



At someone else’s home



Source: IPSOS Canada, Total Food Items 12M ending June 2024.

Source: IPSOS Canada, 5YR month ending June 2024

CATEGORY CAPTAINS 19

Over

0 0 3 1, anuts Pein every jar

*

*1 kg Jif® Creamy Peanut Butter based on average production (excluding Light).

TM/©/® Smucker Foods of Canada Corp. or its affiliates.

PEANUT BUTTER Peanut Butter continues to be a household staple for Canadians, reaching annual sales of $351 million.1 While the total category has experienced inflationary dollar growth of 6%, tonnage volume has declined slightly by 2%.1 The category is led by Regular (Stabilized) Peanut Butter, accounting for 81% of sales across the category and experiencing dollar growth of 7% vs year ago, while the Natural Peanut Butter segment represents the remaining 19% of total category with annual dollar growth of 2%.1 Creamy Peanut Butter continues to be the preferred Peanut Butter sub-segment of consumers (68%), followed by Crunchy (19%), Light (12%), and Dark Roast (1%).1 With annual household penetration at 67.8%,2 Canadians continue to consume peanut butter in their diets, perceiving it as a healthy, convenient, on-the-go option that satisfies hunger and provides an energy boost.3 With multiple usage occasions, Canadians continue to use peanut butter as a spread (77%), ingredient in dishes (45%) or even straight out of the jar (28%).3 Peanut Butter continues to offer an affordable solution to evolving consumer needs, making it key for retailers to offer a variety of Brands to meet them.

Sources: 1. NielsenIQ, National All Channels, L52W Period Ending July 13, 2024 2. NielsenIQ Panel On Demand Homescan Data, L52W Period Ending July 13, 2024 3. Erickson Research, Peanut Bureau of Canada – Canada (2024)

PEANUT BUTTER 3-YEAR TREND

$ Volume

Tonn Volume (Kg)

Source: NielsenIQ, National All Channels, L52 Period Ending July 13, 2024

PEANUT BUTTER SEGMENTS, DOLLAR VOLUME AND DOLLAR SHARE Total Peanut Butter Dollar Volume $351,202,913

Natural Peanut Butter

PEANUT BUTTER SUB-SEGMENTS

Total Dollar Volume and % of Dollar Share

Regular Peanut Butter Source: NielsenIQ, National All Channels, L52W Period Ending July 13, 2024

Creamy

Crunchy

Light

Dark Roast

Source: NielsenIQ, National All Channels, L52W Period Ending July 13, 2024 Note: Creamy and Crunchy calculations exclude overlap of Light and Dark Roast Sub-Segments

CATEGORY CAPTAINS 21

*

* As part of a complete breakfast and balanced diet.

Silk® / Silk® NexmilkTM © 2024 WhiteWave Services, Inc. All rights reserved.

PLANT-BASED BEVERAGES Health and taste are the main reasons why Canadians turn to non-dairy milk, with health as the number one purchase driver for all plant-based shoppers in Canada. Personal values influence buying behaviour as those who eat plant-based diets are 2.5 times more likely than the average consumer to say they chose their diet to align with their values demonstrating, aligning the category with rising consumer concerns around health, sustainability, animal welfare and food security.

The Plant-Based category lends itself to the changing consumer landscape as 80% of new Canadians, particularly those from South Asia, have purchased non-dairy milk in the last three months.1 This is especially true for recruitment and retention of younger shoppers as 73% of new Canadians aged 18-34 have purchased non-dairy milk in the last three months, important facts for long-term category growth as 44% of the Canadian population is expected to be multicultural by the year 2030.2 Consumer behaviours have influenced Coconut base growing at +13.4% dollars3 due to its versatility across many occasions including cooking. Changing demographics and the high protein offering in Soy helped the segment deliver +0.2 dollar share gains.3 The Dairy Like segment, delivering on taste and texture sought out by the plant-based consumer secured a 2.0 share, +17.3% dollars in the latest 52 weeks3 on portfolio and distribution expansion.

Sources: 1. Mintel, June 2023 | Insight Plant-Based Milks Can Recruit New Flex-Dairy-ans; Mintel, Dairy and Non-Dairy Milk Canada, 2023.

2. Mintel, August 27, 2024 | Report Milk and Non-Dairy Milk – US – 2024.

3 Nielsen, MarketTrack, National Incl. NFLD GB+DR+MM – L52W period ending July 13, 2024.

HOUSEHOLD PENETRATION Total Plant-Based Beverages Almond Oat Soy Blends Dairy-Like

Source: Nielsen, Marketrack, National Incl. NFLD GB +DR +MM, L52W period ending July 13, 2024.

$ SHARE OF SEGMENT

Almond

Oat Soya

Coconut Cashew Dairy-Like Coconut/Almond Rice

Source: Nielsen, Marketrack, National Incl. NFLD GB +DR +MM L52W period ending July 13, 2024.

CATEGORY CAPTAINS 23

PROTEIN SNACKS Canadians are turning to snacks with protein in their quest for healthier food options.3 Snacking continues to increase in frequency and importance • With increased focus on satisfying daily nutritional priorities, Canadians are turning to snacks with protein in their quest for healthier food options2.

• 46% of Canadian consumers agree that they can’t get enough protein without animal meat1.

Product Innovation is driving growth of the Meat Snack category • Loyal Jerky consumers continue to indulge in more of their favourite brand when it is offered in bold new flavours, but product innovation is critical to attract new consumers to the Meat Snack category, driving trial and purchase incidence.

Disrupt the shopping trip to drive purchase incidence • By merchandising top performing core items as well as innovative new items with multiple points of availability, retailers will see increases in impulse purchase, frequency of purchase, and ultimately, profitable category growth.

Trends in product innovation, coupled with consumers’ focus on prioritizing nutritional snacking, will continue to fuel the growth of Meat Snacks in Canada.

Sources: 1. Mintel, Future of Animal Proteins, 2024; 2. Healthy Hits the Spot, Canadian Grocer, Sept 9,2021 3. Mintel snacking motivations, 2024.

SNACKING CONTINUES TO GROW IN IMPORTANCE

Total Population

Male 18-34

Male 35-54 More

Female 18-34

MEAT SNACKS, AS A CATEGORY, CONTINUE TO DELIVER SALES GROWTH

Female 35-54

MEAT SNACKS CONTINUE TO ATTRACT NEW SHOPPERS 3.4 MILLION HOUSEHOLDS

+200,000

MORE $ PER BUYER

Source: NielsenIQ MarketTrack. National All Channels.

Total Meat Snacks Trended sales L52W period ending July 13, 2024. * Projected Sales.

Same

Source: Mintel Salty Snacks Report, Feb 27, 2024.

MORE BUYERS

MORE TRIPS PER BUYER

Shoppers are spending more and putting Meat Snacks in their basket more often.

Source: Nielsen Homescan. Market Summary. L52W weeks period ending Feb 2024. Total Outlets. Total Meat Snacks.

PROTEIN POWER Protein is considered the most important nutrient, and most Canadians think of meat as the main source of protein

When eyeing snacks at the store, consumers cite protein as the most important attribute.

An overwhelming

of consumers

admit it’s more critical than ever for protein to take center stage Source: NielsenIQ. Wellness Trends Influencing Consumers. 2024.

CATEGORY CAPTAINS 25

SALAD DRESSINGS Pourable Salad Dressings (PSD) is a $316MM1 mature category with a +3.4% 2-year CAGR and an average household penetration of 71.7% over the last 2 years2.

The category is comprised of two major segments, refrigerated and shelf stable dressings (SSD), where SSD represents two-thirds of the category. In the last 52 weeks, PSD has seen a continued rise in dollar sales vs. prior year while overall product consumption declines (-3.0% pounds vs. last year)3 – this is due to two factors, rise of inflation and growth of premium smaller/restaurant brands.

Pourable Salad Dressings are primarily consumed at meal occasions led by dinner, and routinely used with over 60% consuming it three or more times per week4. Since 2020, household penetration continues to decline as consumers are dissatisfied with the additives and lack of flavour in current offerings, turning to homemade dressings for simpler, customizable ingredients. While salads remain the top host food, consumers are expanding consumption to non-traditional occasions such as dipping with creamy dressings and marinating with vinaigrettes4.

Sources: 1 NielsenIQ, TOTAL National - L52W period ending Aug 17 2024 & Cal-Year 2022 & 2023 2 NielsenIQ, TOTAL National - BMO TOTAL OUTLETS - L52W period ending Jul 27 2024 & Cal-Year 2022 & 2023 3 NielsenIQ, TOTAL National - L52W period ending Aug 17 2024 4 Ipsos FIVE 12ME February 2024 | % Occurrences – Total Food Universe

IMPORTANCE IN BOTH SHELF STABLE & REFRIGERATED SEGMENTS Shelf-Stable Share

Refrigerated Share

*Note: Year to date, August 17, 2024 Source: NielsenIQ, TOTAL National - L52W period ending August 17, 2024 & Cal-Year 2022 & 2023

DOLLAR SALES GROWTH BUT DECLINE IN POUNDS DUE TO INFLATION & PREMIUMIZATION

HOUSEHOLD PENETRATION

Volume in Pounds (lbs)

Dollar Sales ($)

*Note: Year to date, August 17, 2024 Source: NielsenIQ, TOTAL National - BMO TOTAL OUTLETS L52W period ending July 27, 2024 & Cal-Year 2022 & 2023

*Note: Year to date, August 17, 2024 Source: NielsenIQ, TOTAL National - L52W period ending August 17, 2024 & Cal-Year 2022 & 2023

CATEGORY CAPTAINS 27

Now Exhibiting:

W b l

q

b

,

l

l v

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Sponsored by:

J y

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ll

,

V

www.treeoflife.ca

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A Tasteful Collection

C

SPECIALTY FOODS Canada’s shifting demographics, fueled by immigration and global connectivity, is propelling its culinary world into a vibrant tapestry of flavours. Almost 40% of new immigrants hail from Asian countries like India, the Philippines, and China, enriching Canada’s food culture.1 While Canadians are increasingly embracing international cuisines for diverse culinary experiences, new immigrants often seek comfort in dishes reflecting their cultural heritage.

The Asian cooking and baking sauces segment in Canada experienced a 12% increase in sales, reflecting the growing preference for home cooking2, with these sauces being a top choice. Chinese cuisine is favoured, followed by Mediterranean and Latin American/Mexican dishes. African cuisine piques the interest of 45% of Canadians, followed by Korean and Caribbean flavours.3 Grocery stores can diversify their offerings by introducing seasoning kits, meal kits, frozen or fresh prepared meals, encouraging customers to explore new flavours. Fusion dishes are a welcoming gateway to international cuisine for those seeing new culinary experiences. With these trends, Canada’s food landscape is set for ongoing expansion and evolution.

Sources: 1. Stats Can 2. Nielsen IQ Item Ranking – Oriental Sauces Plus Cooking & Baking Sauces, National excl NFLD GB+DR+MM, L52W period ending Sept 2, 2023 3 Mintel – Internationally Inspired Foods, Canada, 2023

CANADA: CONSUMPTION AND INTEREST IN INTERNATIONAL FOODS, 2023 Have eaten

Have not eaten, but interested in trying

CANADA: INTERNATIONAL FOODS CANADIANS HAVE NOT EATEN BUT ARE INTERESTED IN TRYING, 2023

Have not eaten, not interested in trying

African

Korean

Caribbean

Southeast Asian

Chinese Mediterranean Latin Am./Mexican Western European

Eastern European

Middle Eastern

Western European

Indian/South Asian

Japanese

Latin Am./Mexican

Mediterranean

Chinese

Indian/South Asian

Southeast Asian

Middle Eastern

Caribbean

Korean

African

% of customers

% of customers

Source: Mintel – Internationally Inspired Foods, Canada, 2023

Source: Mintel – Internationally Inspired Foods, Canada, 2023

CANADA: AREAS OF INTEREST IN INTERNATIONAL FOODS, 2023

MARKET SIZE, DOLLAR GROWTH AND UNIT SALES Oriental Sauces plus Baking & Cooking Sauces

Fusion dishes inspired by a mix of different countries/regions

Dollar Sales

Seasoning kits inspired by different regions

Desserts infused with international/ internationally inspired flavours

Beverages

Heatable prepared foods inspired by international foods

% of customers

Source: Mintel – Internationally Inspired Foods, Canada, 2023

Unit Sales

Salty snacks seasoned with international/ internationally inspired flavours

International/internationally inspired meal kits

Eastern European

Japanese

Source: Nielsen IQ Item Ranking – Oriental Sauces Plus Baking & Cooking Sauces, National excl NFLD GB+DR+MM, L52W period ending Sept 2, 2023

CATEGORY CAPTAINS 29

Bringing health through food to Canadians

Silk® © 2024 WhiteWave Services, Inc. All rights reserved.

Activia® / Danone® / Two GoodTM used under lic., © 2024 Cie Gervais Danone.

Oikos® used under lic., © 2024 Danone US, LLC. All rights reserved.

Danone Canada is a Certified B CorpTM

YOGURT Consumption of yogurt has been driven in part by an increase in household penetration, hitting 88.6% in the last 52 weeks,1 +0.2 pts and a shift towards more premium and valueadded segments, mainly functional benefits, which has lifted total Yogurt category growth of +9.2% dollar share, +5.4% EQ (tonnage) in the last 52 weeks.2 The primary motivation for consumers planning to increase their yogurt intake is the pursuit of a healthier diet, focusing on products that offer specific health benefits. Yogurts highlighting health attributes, include those with natural ingredients, protein and added functional benefits.1

The Greek segment continues to drive absolute dollar sales as shoppers are seeking out high-protein options within their diets. 45% of consumers agree that “high in protein” is a key health-related consideration when choosing yogurt products.3 50% of consumers are interested in yogurt with a creamier/thicker texture which is very on trend with the profile of High Protein and Indulgent segment. In addition to consumer interest in high-protein, shoppers are seeking gut-healing properties found within Yogurt, especially within the Active Health segment holding a 20.3 dollar share of total yogurt on +3.8% dollar growth in the last 52 weeks2 driven by gut health, gut microbiome and probiotic trends. Continued growth of the yogurt category will stem from an appetite for healthier lifestyles, satisfied by a broad selection of Yogurt with functional benefits and diverse flavours.

Sources: 1. Nielsen Homescan, National Incl. NFLD GB +DR + MM, L52W period ending June 15, 2024.

2. Nielsen, National Incl. NFLD GB +DR + MM, L52W period ending September 7, 2024 3. Yogurt and Yogurt Drinks Report 2024 - Canada, Mintel.

ABSOLUTE $ GROWTH OF THE SEGMENT Absolute Change in Sales $

Yogurt

Greek incl. Skyr Active Health

Kids

Regular

Indulgent Light

Organic

Plant-Based All Other

Source: Nielsen, National Incl. NFLD GB +DR + MM, L52W period ending September 7, 2024.

Greek including Skyr Kids

Regular

Active Health

Indulgent

Light

Organic

Plant-Based Other

Source: Nielsen, National Incl. NFLD GB +DR + MM, L52W period ending September 7, 2024.

HOUSEHOLD PENETRATION RATE (LAST 3 YEARS) Household Penetration (%)

$ SHARE OF SEGMENT

Rolling 52 w/e

June 18, 2022

Rolling 52 w/e

June 17, 2023

Rolling 52 w/e

June 15, 2024

Source: Nielsen Homescan, National Incl. NFLD GB +DR + MM, rolling 52W period ending June 15, 2024.

CATEGORY CAPTAINS 31