Page 1

Private label powers up

Inside Denninger’s The growing appetite new Burlington store for meat snacks

Star Power

 MEET OUR 19 STAR WOMEN IN GROCERY AWARD WINNERS

From Left: CHRIS YU • Galleria Supermarket /// CYNTHIA BERETTA • Beretta Farms LYNE CASTONGUAY • Sobeys /// ALICIA SAMUEL • Longo’s CHERYL SMITH • Parmalat Canada /// DANA SOMERVILLE • Kraft Heinz Canada


Congratulations,

CHERYL SMITH on winning a Star Women Award from the team at Parmalat.

Congratulations from the Sales and Marketing women in leadership at Parmalat Canada

Catherine Newman, Vice President Marketing; Marie Josee Angell, Director Sales; Nathalie Cusson, National Director Sales; Rosa Checchia, Vice President Marketing; Adrienne Pagot-Gerault, Senior Vice President Marketing; Cheryl Smith, General Manager; Diana Palacio, Director Marketing; Vanessa Grekov, National Director Marketing; Joelle Gloaguen-Laurent, Vice President Sales; Sameera Narang, Director Marketing; Belinda Parker, Director Sales


Delivering Dairy Goodness, every time.


Since 1883, Club House has committed to bringing Canada the purest flavours possible. From our family in London, Ontario, to yours - we’re proud to have found a home on your shelves and in so many Canadian cupboards.

AFTER 135 YEARS

CANADIANS KNOW

PURE FLAVOUR TASTES BETTER helloflavour.ca/pureflavour

*Reg TM/MD McCormick Canada


CONTENTS June/July 2018

COVER STORY

Volume 132 Number 4

SHINING STARS

29

OPINIONS

Introducing 2018’s Star Women award winners

7  Front Desk 18  Food Bytes 20  Behind the Trends 22  Eating in Canada 58  Checking Out PEOPLE

8  The Buzz

Comings and goings, store openings, awards, events, etc.

FEATURES

10  Matthew von Teichman

OLD WORLD MEETS NEW WORLD

Meet the president of GreenSpace Brands, where growth is on the menu

IDEAS

24  A look inside Denninger’s

13  Feeding the future

As vertical farming takes root, we chat with the president of Modular Farms Co.

stylish new store

THE POWER OF PRIVATE LABEL

14  How about those GMOs?

Canadians have divided opinions on GMOs, says Dalhousie study

44  Store brands are the

16  Seen & heard

new secret weapon in the battle for grocery shoppers

24

A roundup of industry insights shared at recent conferences

AISLES

49  Beefing up on meat snacks Meat snack sales are rising, thanks to innovation and a growing appetite for protein

52  The ginger boom

This ancient spice is on trend in 2018

53  Looking good, feeling good Nielsen reveals its latest data on health and beauty aids

44

FRESH

55  It’s a small (veggie) world COVER IMAGE: JENNIFER ROBERTS

Mini veggies are a big hit in the produce section

10

49

FOLLOW US ON @CanadianGrocer Canadian Grocer Magazine @CanadianGrocerMagazine June/July 2018 Canadian Grocer

5


PRESIDENT, ENSEMBLEIQ-CANADA Jennifer Litterick

FRONT DESK

jlitterick@ensembleiq.com

VICE PRESIDENT/ GENERAL MANAGER EVENTS Michael Cronin mcronin@ensembleiq.com

EDITOR-IN-CHIEF Shellee Fitzgerald

sfitzgerald@ensembleiq.com

MANAGING EDITOR Carol Neshevich

cneshevich@ensembleiq.com

ONLINE EDITOR Kristin Laird

klaird@ensembleiq.com

ART DIRECTOR Josephine Woertman

jwoertman@ensembleiq.com

CONSULTING EDITOR George H. Condon condug@sympatico.ca

DIRECTOR OF PRODUCTION & DESIGN CANADA Derek Estey destey@ensembleiq.com

PRODUCTION MANAGER Michael Kimpton mkimpton@ensembleiq.com

AUDIENCE DEVELOPMENT MANAGER Lina Trunina ltrunina@ensembleiq.com

WEB OPERATIONS MANAGER Valerie White vwhite@ensembleiq.com

SALES ASSOCIATE BRAND DIRECTOR Vanessa Peters vpeters@ensembleiq.com

SR BUSINESS DEVELOPMENT MANAGER Chantal Barlow cbarlow@ensembleiq.com

EDITORIAL ADVISORY BOARD Tom Barlow, Ross Bletsoe, François Bouchard, André Gagné, Annick Gazaille, Denis Gendron, Lorelle Gilpin, Florent Gravel, Won Suk Ha, Jessica Kim, Les Mann, Ken Schley, Peter Singer, Mondella Stacey, Mike Venton SUBSCRIPTION SERVICES Subscriptions: $85.00 per year, 2 year $136.00, Outside Canada $136.00 per year, Single Copy $12.00, Groups $59.00, Outside Canada Single Copy $16.00. Email: contactus@canadiangrocer.com Phone: 1-844-694-4422 between 9 a.m. to 5 p.m. EST weekdays Fax: 1-844-815-0700 Online: www.canadiangrocer.com/subscription

REPRINTS, PERMISSIONS AND LICENSING Please contact Wright’s Media ensembleiq@wrightsmedia.com 1-877-652-5295

CORPORATE OFFICERS

EXECUTIVE CHAIRMAN  Alan Glass CHIEF EXECUTIVE OFFICER  David Shanker CHIEF OPERATING OFFICER & CHIEF FINANCIAL OFFICER  Richard Rivera CHIEF BRAND OFFICER  Korry Stagnito PRESIDENT, ENTERPRISE SOLUTIONS Terese Herbig CHIEF DIGITAL OFFICER  Joel Hughes CHIEF HUMAN RESOURCES OFFICER Jennifer Turner SENIOR VICE PRESIDENT, INNOVATION  Tanner Van Dusen

MAIL PREFERENCES: From time to time other organizations may ask Canadian Grocer if they may send information about a product or service to some Canadian Grocer subscribers, by mail or email. If you do not wish to receive these messages, contact us in any of the ways listed above. Contents Copyright © 2018 by EnsembleIQ, may not be reprinted without permission. Canadian Grocer receives unsolicited materials (including letters to the editor, press releases, promotional items and images) from time to time. Canadian Grocer, its affiliates and assignees may use, reproduce, publish, republish, distribute, store and archive such submissions in whole or in part in any form or medium whatsoever, without compensation of any sort. ISSN# 0008-3704 PM 42940023 Canadian Grocer is Published by Stagnito Partners Canada Inc., 20 Eglinton Avenue West, Ste. 1800, Toronto, Ontario, M4R 1K8.

JOHN GOLDSTEIN MEDIA

Printed in Canada at Transcontinental.

Canadian Grocer launched the Star Women Awards in 2012

WOMEN AT WORK

Once again, it’s time to recognize our industry’s extraordinary women and the work they do ABOUT A YEAR AGO in this space, I wrote about the outstanding achievements of women in our industry, and Canadian Grocer’s desire to recognize these achievements through our annual Star Women in Grocery Awards. Our cover may have given you a clue— in this issue we are once again shining a light on our Star Women winners. From a tall stack of nomination forms (big thanks to all of you who took the time to nominate colleagues!) our editors, with the help of a panel of former winners, selected 19 standouts: women who have gone above and beyond to make critical contributions to their companies and the industry at large. This year’s winners come from various backgrounds and have compelling stories to tell. One, Julie Bednarski, is a chef-turnedentrepreneur who got her big break when her product caught the eye of Starbucks. Another, Cynthia Beretta, set up a farm to produce organic meat 25 years ago, long before it was trendy to do so. And another of our Star Women, Janet Jacks, started her career as an elementary school teacher then plunged into the grocery business, opening

a natural food store where she applied her teaching skills to help educate her customers on healthy eating. Jacks’ single Goodness Me! store has expanded to nine, with a 10th in the works. (Read all of their stories starting on page 29.) We are celebrating this year’s winners at a crucial time for women. Over the past year, movements like #MeToo have propelled women’s issues to the forefront. And while there are clear challenges, research also tells us that more companies are committing to gender equality—realizing that having more women in the ranks, especially in leadership roles, is good for the bottom line. It's a hopeful sign. So, kudos again to our inspiring 2018 winners. And if you happen to be in Toronto on Sept. 25, please join us at our Star Women in Grocery Awards Breakfast.

Shellee Fitzgerald

Editor-in-Chief

sfitzgerald@ensembleiq.com

The grocery industry is changing rapidly. Keep up to date on the latest news by signing up for our e-newsletter. It’s free and we’ll deliver it to your inbox three times a week. We acknowledge the financial support of the Government of Canada through the Canada Periodical Fund of the Department of Canadian Heritage.

VISIT CANADIANGROCER.COM TO SUBSCRIBE.

June/July 2018 Canadian Grocer

7


THE BUZZ

The latest news in the grocery biz

OPENINGS

Denninger’s Foods of the World celebrated the grand opening of its fifth location at Burlington Mall in Burlington, Ont. in May. The 23,000-sq-ft. store occupies a former Target outlet and features European specialties, prepared foods, and fresh meat and seafood. Read more about Denninger’s in our Store Profile on page 24. FRESON BROS. has debuted a new store in Fort Saskatchewan, Alta. The 44,000sq.-ft. Freson Bros. Fresh Market is the independent grocery chain’s 16th store. Its owners say the new location serves up a “unique Alberta food experience” and features one of the largest selections of locally sourced Alberta products, as well as a fully-licensed restaurant and its signature Banj’s Smokehouse.

ANNOUNCEMENTS

Ontario-based natural food retailer Goodness Me! has announced plans to open four more stores over the next two years, focusing on the west end of the Greater Toronto Area and Southern Ontario. The natural food retailer currently has nine locations. Planet Organic plans to expand in Edmonton. The organic grocer says it will open its third location in the city in Ellerslie Market and plans to open a fourth Edmonton store this fall in Sherwood Park. Planet Organic also has four stores in Calgary, one in Victoria, B.C. and one in Mississauga, Ont.

GIVING BACK

At its 23rd Annual Save-On-Foods Charity Golf Tournament in May, SAVE-ON-FOODS helped raise more than $580,000 for children’s hospitals in Western Canada.

8

June/July 2018 Canadian Grocer

Regina now has a second SAVE-ON-FOODS. Located in the Saskatchewan city’s Acre 21 shopping centre, the new store— which opened on May 25—features a full kitchen, in-store Starbucks and a pharmacy. AVRIL SUPERMARCHÉ SANTÉ has a new store in Laval, Que. The store is the eighth location for the independent Quebec health food chain, which specializes in natural and organic groceries as well as vitamins and supplements. Avril’s other locations are in Brossard, Longueuil, Sherbrooke, Magog, Granby, Quebec City and Lévis. GIANT TIGER is on the move. The discount chain has opened a new, 21,000-sq.-ft. store in Rouyn-Noranda, Que. Giant Tiger—already with about 240 locations across Canada—is in expansion mode, opening a slew of stores in recent months in communities such as Steinbach, Man., and Renfrew, Ont. It also recently announced plans to open a 40,000-sq.-ft. store in mid-October at the Tecumseh Mall in Windsor, Ont.

JAIME HOGGE, SAVE-ON-FOODS

Burlington, Ont. is now home to a new Denninger’s


THE BUZZ

COMINGS AND GOINGS

EVENTS

The Canadian Coffee and Tea Show will take place at the Toronto Congress Centre from Sept. 23 to 24. Visit coffeeteashow.ca for more info.

AWARDS/RECOGNITION

SIAL Canada unveiled the winners of its SIAL Innovation Contest in May. Gold went to Pea Pops by Saskatchewan-based THREE FARMERS ; Silver was awarded to Ready-to-eat vegan meals by U.S.-based CUCINA & AMORE; and cricket-based protein bars by Quebec’s CRICKSTART took home the bronze.

Canadian Grocer’s Star Women Awards Breakfast will be held on Sept. 25 at The International Centre in Mississauga, Ont. Please visit starwomen.ca for tickets, and read about this year’s winners on page 29.

THREE FARMERS, CRICKSTART, JOHN GOLDSTEIN MEDIA, RETAIL COUNCIL OF CANADA

T&T Supermarkets’ founder CINDY LEE and CEO TINA LEE were awarded the Retail Council of Canada’s Grand Prix Trailblazer Lifetime Achievement Award at a ceremony in late May. The award recognizes outstanding service and dedication to the Canadian retail and grocery industry. Starting with one store in 1993, T&T has grown to become the largest Asian grocery business in Canada and will have 27 locations by the end of 2018.

Tina Lee

Lyne Castonguay

Shelley Martin

Jeff Hamilton

DEALS

Montreal-based Saputo says it plans to purchase Shepherd Gourmet Dairy for $100 million. The dairy, located in St. Mary’s, Ont., makes specialty cheeses and yogurt.

Michel Manseau

Nancy Marcus

In early June, Empire Company Ltd. announced a number of leadership changes as part of the ongoing transformation plan for its Sobeys business. MIKE VENTON, who joined the company earlier this year as vice-president of strategic initiatives for discount, is now general manager, discount; LYNE CASTONGUAY formerly executive vice-president, merchandising is stepping into the role of executive vice-president, store experience; PIERRE ST-LAURENT has been named executive vice-president, merchandising and Quebec; LUC L’ARCHEVEQUE has been appointed general manager of the Quebec business; and SARAH JOYCE, previously with HBC, has been hired as senior vice-president, e-commerce. All will report to president and CEO Michael Medline. SHELLEY MARTIN, president and CEO of Nestlé Canada, is retiring at the end of July. Martin was winner of the Food Industry of Canada’s Golden Pencil Award in 2017 for her contributions to the Canadian food industry. The company has announced that JEFF HAMILTON, currently president of Nestlé Foods Division at Nestlé U.S.A., will replace Martin.

Some executive changes at Kruger Products: MICHEL MANSEAU is now senior vice-president and general manager, Canadian consumer business for the company. Manseau was formerly vice-president, consumer sales, Canada. And NANCY MARCUS, previously vicepresident of marketing, will now be chief marketing officer, assuming additional responsibility for Kruger’s U.S. brands. Both will continue to report to CEO Dino Bianco. TAMMY SMITHAM, formerly vicepresident external communications at Loblaw and Shoppers Drug Mart, has been named vice-president communications and public affairs at Aimia Inc. June/July 2018 Canadian Grocer

9


PEOPLE

 Who you need to know  

The Facts Who

Matthew von Teichman Position

President & CEO  of GreenSpace Brands What’s new?

Acquired U.S. plant-based dairy brand Go Veggie and launched meat snack brand Meatbar in 2018

A HEALTHY EATING EMPIRE

Growth is on the menu at Matthew von Teichman’s GreenSpace Brands By Carol Neshevich Photography by Mike Ford


PEOPLE

30 SECONDS WITH...

M

atthew von Teichman credits his wife’s first pregnancy with inspiring his entry into the food industry 16 years ago. With a new reason to eat well, she started bringing home more organic products and was making an effort to have healthier food in the house. “I realized at the time that there weren’t as many healthy processed or value-added foods as she would like, and that was my catalyst to get into the food business,” says von Teichman, now president and CEO of Toronto-based GreenSpace Brands. He had previously enjoyed dotcom success with JobShark, an online job board he sold in 2001, and he was seeking his next venture. “I started doing some research and saw that the natural food industry would be a high-growth sector for a long time.” Von Teichman began with the launch of Life Choices Natural Foods in 2002. The company started off as an organic frozen food business selling organic pizzas, frozen dinners, burritos and perogies. “Some did relatively well, but they never really captured consumers’ imagination,” he says. Everything changed, however, in 2008 when he launched a natural chicken nugget made with whole cuts of meat, with sprouted grains and flax as a coating and that was baked rather than fried. “It was a really healthy chicken nugget,” he says, noting that the nugget’s popularity changed the trajectory of Life Choices. “It was the first big change: realizing there was a real appetite among consumers for healthy, value-added meats.” Von Teichman quickly set about transforming the business, now focusing on healthier, value-added meat items such as hamburgers, sausages and fish sticks (in addition to the chicken nuggets) made with cleaner ingredients. Over the next five years the company enjoyed slow but steady growth. “We had a nice base of business in Canada, but I always wanted to have a bigger company; my previous company had grown quite large, and Life Choices was still stuck under $5 million in revenue,” he says. So, in 2013 von Teichman embarked

on a massive growth strategy with the ambitious goal of creating a house of brands. As part of the plan, he launched a number of new brands and acquired some existing ones—all of which fit within the category of clean, healthy, sustainable and trusted food. To say the company has experienced rapid growth would be an understatement. Now called GreenSpace Brands, von Teichman’s company has either launched or acquired 10 new brands (two of which were recently delisted in an effort to focus on the higher performers). GreenSpace Brands’ current lineup includes von Teichman’s original brand, Life Choices, now focused on responsibly raised, value-added meat products; Rolling Meadow Dairy, specializing in grassfed dairy products, launched in 2014; Kiwi Pure, a butter brand using milk from grass-fed New Zealand cows (part of Rolling Meadow Dairy); Love Child Organics, an organic baby food brand acquired in 2015; Central Roast, a clean snacking brand acquired in 2016; Kiju, a shelf-stable organic juice company acquired in 2017; Cedar, a Canadian leader in cold-pressed juices acquired in 2017; Go Veggie, a U.S. plant-based dairy brand acquired in 2018; and Meatbar, a premium meat snack brand that was launched earlier this year. “Most of our brands are growing [at] over 20% a year currently. All are doing really well, but the three that [are really booming right now] are Central Roast, Love Child and Cedar. Those three are just like runaway trains,” says von Teichman, adding that the company plans to continue expanding through innovation as well as acquisition. The purchase of U.S.-based Go Veggie in January is also expected to open the door to more U.S. business, he says. The growing consumer desire for clean, sustainable foods that they can trust implicitly gives GreenSpace a real advantage over the established food giants, says von Teichman. “Today’s consumer is no longer interested in a nameless, faceless brand,” he says. “There needs to be a story behind the brand that they can get behind.”  CG

MATTHEW VON TEICHMAN What do you like best about your job?

I like everything about it: the strategy side, creating new products, and it might sound weird, but I love to talk to shareholders—I spend a lot of time talking to them and explaining our mission, and I actually really like doing it.

What’s your secret to success?

It’s a bit cliché, because everyone says it, but it’s just about loving what you do. Generally when I get up in the morning I feel super excited to be where I am and doing exactly what I want to be doing. Most success comes from being really passionate about what you do, and I am.

What advice would you give to a young entrepreneur?

Be resilient. Starting a business from the ground up is challenging and can be demoralizing at times, but if you keep perspective and realize that even the worst thing that happens to the company is not the worst thing that can happen to you, that kind of perspective is important.

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

I spend a lot of time with my family. We love to travel, so we take a lot of trips every year. And I read a ton. I’m a big believer in continuing to learn, and I do that through reading.

June/July 2018 Canadian Grocer

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CONGRATULATIONS TO ALL 2018 STAR WOMEN AWARD WINNERS FROM


IDEAS

Retailers, suppliers, shoppers, insights

Aaron Spiro, Modular Farms Co.

VERTICAL FARMING

MODULAR FARMS FOR THIS AND SHOT ON NEXT PAGE

Feeding the future As the idea of vertical farming finally takes root, we speak to a company at the forefront of the movement By Shellee Fitzgerald

T

his could be massive,” said Galen G. Weston at a conference on the future of food in Toronto i n M a y. T h e L o b l a w c h i e f wasn’t referring to the grocer’s new President’s Choice Cricket Powder (although he talked about that, too). Weston was speaking about the potential of vertical farming; specifically, the potential of such farms to help the planet while also addressing food insecurity in Canada’s North, where it’s difficult and expensive to transport fresh food.

Through its PC Children’s Charity, the grocer recently donated a vertical farm to a high school in northern Saskatchewan. Modular Farms Co. is the Ontario-based company that developed the farm for Loblaw. Its purpose-built farms, which look like shipping containers, are designed for any climate and can yield, for example, up to 1,000 heads of lettuce a week using 95% less water than a typical field farm and no pesticides. Along with food retailers, the company has piqued the interest of the Canadian June/July 2018 Canadian Grocer

13


IDEAS military and Google’s Sidewalk Labs. We chatted with Aaron Spiro, president of Modular Farms Co., about the slow but steady adoption of vertical farming and why this new form of agriculture is a smart solution for grocers big and small.

We hear a lot of buzz around vertical farming. Do you think this is an idea that’s time has finally come? Yes. The industry has dragged along for many years, mainly because of the high operational costs, but costs have come down and it’s never been as economically viable as it is today. LED [lighting] efficiencies have gone up, the price of electricity has gone down, things like that have really allowed for it to become much more widespread. And media attention has grown significantly in the last four or five years as there’s been a lot more investment into large-scale vertical farming companies like AeroFarms and Gotham Greens and Plenty, so that’s also helped push vertical farming more into the limelight.

What benefits can grocers reap from adding a vertical farm to their operation? Not everyone, especially smaller grocery chains, can have their own brand of food to sell through their stores—this gives them that ability. The farms are also small so they can be put directly at distribution centres or at grocery stores themselves. Usually a couple of farms on site can provide enough leafy greens or herbs to satisfy the needs of the entire store. For larger stores the farms can be placed at distribution centres/warehouses where grocers can grow their own food, put it on a pallet and send it out to their stores. It gives them a huge advantage of cutting a lot of their transportation costs

related to importing food from places farther afield and then, obviously, the environmental impact is huge in terms of cutting down the transportation miles and carbon footprint. And grocers can guarantee their customers the freshest produce they can get their hands on. It also helps show they’re taking a step towards making their business more sustainable and that they care a lot about the quality and the transparency of the food that’s being sold in their stores.

So greater self-sufficiency is also part of the appeal of these farms? For sure. The more grocers—large and small—that adopt vertical farming technology, the more we free ourselves from relying on other countries for food.

What can be grown in a vertical farm? Technically you can grow almost anything in the towers within the units. We’ve grown everything from corn to peppers and quinoa, mini pumpkins and cucumbers—it all depends on what you’re using the container farm for. The majority of our customers are using the farm as a business and they want to generate a decent return on their investment; growing things like kale and herbs and lettuce usually gives you the highest return in terms of what you can grow the easiest with the least amount of labour. But then again, you can grow things like strawberries, raspberries and cherry tomatoes, no problem; they have high yields, there’s just a lot more labour involved. We’re also continuing to experiment with lots of different crops and we’re continually amazed by what we’re actually able to grow vertically—so the sky’s the limit, really, in terms of what we can actually grow.

Your company has expanded quickly in the past few years. What’s next? We’re working on finalizing and commercializing our next set of [container] modules including an off-grid module. Our biggest goal is eventually to have a net zero farming operation—a farming setup where you don’t need to use any electricity from the grid or take any water from a municipal source—essentially a standalone system. Once we get the efficiencies where they need to be, we’ll be the first container farming company on the market to be able to offer a holistic net-zero farming solution, which we really think is the Holy Grail. CG

14

June/July 2018 Canadian Grocer

GMOS

How about those GMOs? CANADIANS ARE DIVIDED AND CONFUSED when it comes to genetically modified foods, says a new Dalhousie University study. While some think they’re safe to eat, others disagree. But one thing’s clear: Canadians want GMO food to be labelled. Here’s what the study revealed:

70%

of survey respon­dents strongly agreed that GMO food and ingredients should be labelled on all packages

37.7%

believe GMO foods are safe

34.7%

think GMO foods are not safe

52%

of those surveyed said they were “unsure” whether they had purchased GMO plant-based food

Canadians are concerned most about GMO fish and seafood, followed by pork, beef, poultry and dairy. They are least concerned about GMO fruits and veggies SOURCE: BIOTECHNOLOGY IN FOOD: CANADIAN ATTITUDES TOWARD GENETIC ENGINEERING IN BOTH PLANT- AND ANIMALBASED FOODS, DALHOUSIE UNIVERSITY, MAY 2018


2 GREAT EVENTS!

November 19, 2018 | Fairmont Royal York, Toronto

12:45 – 4:00 p.m.

REGISTER TODAY! www.CanadianGrocer.com

Gold Sponsor

Industry Partners

Don’t miss the

Golden Pencil Award Ceremony from 5:00 to 7:00 p.m.

2018 Recipients Mary Dalimonte Former senior vice-president of merchandising and commercial programs, Sobeys

Tom Gunter Executive Vice President & General Manager (retired), Fiera Foods Company and Former President, ConAgra Foods Canada

www.GoldenPencilAwards.com


IDEAS

SEEN & HEARD Big names in the industry have been taking the stage at recent conferences, tackling a range of hot topics. Here’s what they’ve been saying:

On U.S. store closures and right-sizing “We’ve looked at the stats … and we did feel the U.S. was a little over-stored. We don’t necessarily see that Canada has the same problem, but I would say in our case we might have some stores that are too large so we are opening stores with smaller square footage than we would have in the past. I still think there’s room to grow.” SARAH DAVIS, president of Loblaw, at RCC’s STORE 2018

Will physical grocery stores endure? “In my opinion the future of a chain, perhaps like Loblaw but you could insert any brand name in there, will not be that those stores will go away, but I think it’s entirely possible that three quarters of them will go dark,” said Doug Stephens at STORE 2018. What we call a store today will become a mini warehouse tomorrow—local fulfillment stores for online purchases and for merchandise that’s needed at full-line stores. “And those full-line stores won’t necessarily be invested in the selling of product and obsessed with sales per square foot; they’re going to be interested in selling experiences with those products.” DOUG STEPHENS, Retail Prophet, at RCC’s STORE 2018

DON’T FORGET THE HARD DISCOUNTERS Despite all the noise about Amazon, CIBC World Markets analyst Mark Petrie said the bigger disruptor to the North American grocery industry is the hard discounters, which are “way more disruptive” in the U.S. today than e-commerce in terms of wreaking havoc on the larger grocers. “The question we always get is: Are Aldi and Lidl going to come to Canada? … I think it’s a matter of when, not if … There are all kinds of reasons why the Canadian market is less attractive, just structurally, but I do think there are opportunities for them in Canada.” MARK PETRIE, CIBC World Markets, at Grocery & Specialty Food West

Be “payment ready” “What we’re seeing is consumers want to pay when they want to pay, where they want to pay and how they want to pay,” said Moneris’ Jeff Guthrie at the Payments Canada Summit. If your business isn’t prepared to accept the type of payment the customer wants to use, research shows they’ll simply go to another store. “They’ll move on because it’s just less friction to buy it somewhere else.”

Power of the plants “We’re leaning into the [plant-based foods] trend. We see an opportunity—because there is consumer interest—to accelerate, to amplify that consumer interest by bringing accessible products to Canadians that are exclusively and entirely vegan; so, we will launch 30 President’s Choice products next year that are exclusively vegan. Our focus is to try and increasingly build accessibility and availability of plant-based sources of protein.” GALEN G. WESTON, CEO of Loblaw, at Arrell Food Summit

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June/July 2018 Canadian Grocer

LOBLAW COS. LTD., CFIG, RETAIL PROPHET, CP IMAGES

JEFF GUTHRIE, chief sales & marketing officer, Moneris, at Payments Canada Summit


Congratulations to the 2018 Star Women in Grocery Winners for driving our industry forward! UNFI Canada is a proud sponsor of the annual Star Women in Grocery Awards


FOOD BYTES

Joel Gregoire

WOOING THE NATURAL SHOPPER

More must be done to convey the value of natural and organic foods to consumers AS THE WORLD gets increasingly complex, many Canadians are seeking to simplify their lives—and this includes their diets. It’s no wonder, then, that natural and organic foods and beverages continue to rise in popularity. According to Mintel’s The Natural/ Organic Shopper Canada 2018 report, more than twice as many Canadians say they’re purchasing more natural and organic foods this year, compared to those who claim they’re buying fewer of these products. But despite the apparent growing popularity of natural and organic foods, challenges remain. The biggest hurdle for products with all-natural and, particularly, organic claims is the consumer perception that they’re more expensive. Mintel research reveals that 52% of Canadians identify organic foods or beverages as being “expensive,” while 31% say they believe products with a natural claim are pricey. By comparison, just 10% of consumers view “traditional or mainstream”

products as expensive. Furthermore, the majority (69%) of purchasers of organic/ natural foods and beverages say they would buy more of these products if they were less expensive. How can producers of organic or natural foods overcome this barrier? One way is to reduce prices. That said, brands have to consider how feasible this is operationally and whether it would truly help drive sales. Another strategy is to ensure growers, producers and retailers focus on the strengths organic and natural products offer from a consumer standpoint. When provided with a list of statements on the benefits of these products, Canadians surveyed for the report were most likely to agree that foods with organic/natural claims are “better for you.” This was followed by being “safer,” with parents, specifically moms, most likely to agree that they are safer. Mothers are also more likely to say they would purchase more organic/natural foods if “they were proven as safer.”

PRICE PERCEPTION PROBLEM

“Which attributes do you associate with the following food/beverage product types?” Association with being “expensive” by product type

52% 31% 10% 18

Organic

While safety is a consideration that Canadians relate to, is this positioning practical or even beneficial? After all, the food supply chain is generally not considered to be unsafe. Safety, however, does not always have to be an immediate concern; it can also be a long-term impact that the food or beverages might have on one’s self and one’s family. Looking at what Canadians associate with organics and, to a lesser extent, foods with natural claims, provides some insight on how producers can credibly build on messaging around safety. The term “free” is an association that comes up a lot when consumers think about these categories; for instance, consumers associate organics with being preservative-free, hormone-free and free of pesticides. Identifying these associations sheds light on how consumers view foods and drinks with natural—and particularly organic—claims and, therefore, offers guidance when it comes to crafting messaging that will resonate with the typical Canadian. The strength of the associations would likely vary according to the category (for example, fresh versus packaged goods), but on the whole, they illustrate that the value consumers assign to organic and natural foods versus traditional foods is a clear understanding of what’s in and (perhaps more importantly) what’s not in, the items they purchase. The next step is tying these existing associations to long-term benefits to demonstrate the value organic and natural foods and beverages provide. As Canadians look to simplify their lives, the core benefit organic and natural foods and drinks offer is trust, giving consumers one less thing to worry about in an increasingly complex world.  CG

With natural claim Traditional/mainstream (i.e. without organic or natural claim) SOURCE: LIGHTSPEED/MINTEL, JANUARY 2018 || BASE: 2,000 INTERNET USERS AGED 18+

June/July 2018 Canadian Grocer

Joel Gregoire is associate director, Food & Drink at Mintel, the world’s leading market intelligence agency. Based in Toronto, Joel researches and writes reports on Canada’s food and drink industry. @JoelDGregoire


A WOMAN WHO’S OUT-STANDINGIN-HER-FIELD… Canada Beef congratulates beef farmer, Sandra Vos, as this year's recipient of Ontario's The Environmental Stewardship Award (TESA). We commend your leadership in stewardship practices for the cattle, land, water and resources in your care. To learn more about Sandra’s good work and TESA visit canadabeef.ca/WhyCanadianBeef


BEHIND THE TRENDS

Eric Totaro

CAR-BASED COMMERCE The race for car commerce is already underway in the U.S. Here’s what Canadian retailers should know about the emerging trend ACCORDING TO VISA AND PYMNTS.COM,

Canada’s neighbours to the south spend more than $250 billion on products and services during their commutes to and from work. In 2017, for the first time ever, more cars were registered with mobile networks than actual new phones in the United States, according to Chetan Sharma, a mobile data consultancy. Both of these statistics show the massive market potential for carbased commerce. Merchants that engage consumers can grab share by reaching new consumers while selling additional products and services to existing ones, resulting in organic growth of the retail market beyond its current size. HOW CAR-BASED COMMERCE WORKS: TOUCH VS. VOICE

Car-based commerce can occur in any vehicle with an Internet connection; drivers interact with the in-vehicle infotainment system via touch or voice to purchase products and services. Only two automakers currently offer platforms that enable consumers to make purchases from behind the wheel: SAIC in China and General Motors with its Marketplace platform in the United States. Through these built-in platforms, drivers can purchase fuel and coffee or reserve a parking space by navigating the centre infotainment screen with their fingers. While major automakers are focusing on built-in platforms, technology companies are also betting on car commerce. Amazon is gaining early insights in voice-based commerce through Alexa in non-automotive settings. Alexa is already offered as a convenience feature

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June/July 2018 Canadian Grocer

in vehicles from eight of the 10 largest automakers by global sales. Alexa-based commerce features can be enabled in these vehicles through a remote software update. Other third-party software developers—namely Apple and Google— offer voice-based assistants in vehicles, though none focus on commerce. Voice-based commerce circumvents two major issues plaguing touch-based systems: liability stemming from distracted driving and limited screen space. Because systems such as GM Marketplace require drivers to take their eyes off the road, its functionality is limited to when the vehicle is not in motion. More touch-based features are being introduced into vehicles that leverage the centre screen, while voice-based assistants circumvent the competition for screen space by reaching drivers through another medium. WHY CANADIAN RETAILERS ARE PRIME BENEFICIARIES

According to Euromonitor International’s 2017 Global Consumer Trends Survey, groceries and household essentials are the most frequently purchased items in Canada weekly, followed by food for takeaway and delivery. The high purchase frequency in these categories means grocers operate in a category with ample opportunity to increase discretionary purchases through car-based commerce. A growing share of transactions that occur near the car will be incorporated into vehicles in the near future as a means of saving time for busy consumers. The added convenience will also incentivize these consumers to buy more

often and consider purchasing products and services they otherwise may not. Car-based commerce currently operates through a click-and-collect model, which is cheaper for merchants than delivery. Canada’s car-based culture and diversity mean that the big grocers already operate stores along major thoroughfares and have strategies for targeting the multitude of ethnicities and foreign-born residents that make up the Canadian consumer base. Canada’s smaller population allows merchants and software players to be nimbler in testing new strategies to target consumers than in larger markets like the United States or China. WHAT CANADIAN RETAILERS CAN DO NOW There are two strategies that Canadian grocers can pursue now: partner with existing car commerce players such as General Motors, or partner with software firms that have a presence in the car such as Amazon, Apple or Google. While GM Marketplace is not currently available in Canada, the delay may be a blessing in disguise for Canadian retailers. Merchants partnering with General Motors in the United States face a scalability issue because the software powering each automaker’s infotainment system is unique. Third-party platforms such as Alexa avoid this scalability issue and are a onestop solution for those merchants looking to enter car commerce. Canadian retailers should use this time to identify stakeholders at third-party software firms and work with them to strategize carbased commerce opportunities. At the very least, merchants need to be aware of the trend and the multibillion-dollar market that car-based commerce will quickly become.  CG

Eric Totaro is a Senior Automotive Analyst at Euromonitor International, an independent provider of strategic market research. Euromonitor.com


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EATING IN CANADA

Kathy Perrotta

THE EVOLUTION OF SNACKING

New research reveals Canadians are updating their preferences and are seeking a middle ground when it comes to snacks—no guilt, no missing out SNACKING CONTINUES to be a dominant force in the reshaping of Canadian eating patterns. While about a third (33%) of all occasions throughout the day are at traditional meal times, the balance (67%) of eating and drinking occurs at snack or in-between meal occasions, according to the brand new Ipsos FIVE Canadian Snacking Nation 2018 report. Trended information captured over the past five years confirms that the factors defining a snack have changed

THE EXPANDING WORLD OF SNACKS Top ranked non-traditional foods consumed as a snack

Sliced Bread/Toast Eggs All Other Breads Ready-to-Eat Cereal Vegetables Pizza Soup Salad SOURCE: IPSOS - FIVE - % OCCASIONS - TOTAL VENUES - R’12M ENDING MARCH 2018

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June/July 2018 Canadian Grocer

quite dramatically. Most foods, for example, qualify as having snack potential, which extends the snacking landscape far beyond a relatively small group of treat-oriented, indulgent options to now include beverages and foods once positioned strictly for breakfast, lunch or dinner meals (see chart below left). While convenience, availability and taste are still point-of-entry needs for snacking, Canadian consumers are unwilling to sacrifice quality for ease of access. They also seek more and more fresh, less-processed items; demand a higher degree of ingredient transparency and simplicity; and require their choices to provide premium benefits and meet a higher quality of experience. With the rise of technology and the trend towards conscious consumption, it seems Canadians are updating their approach towards snacking. To effectively target today’s snacking needs, we must recognize the growing importance of the middle ground that intersects physical functionality and emotional well-being. Consider the following emerging need states as key opportunity areas: Planned indulgence: More than three-­ quarters (76%) of all items sourced as a snack are part of a planned purchase. While more indulgent snack food choices have tended to be higher-impulse purchase items, consumers are reporting that they are more frequently planning their snack purchases. Mindful choice: The gap between

“what I say” and “what I do” is closing, as a growing number of consumers explore and evaluate their snacking choices. More than half (51%) of Canadian adults today report regularly reading labels and ingredient information. Among those, more than two-thirds (69%) report that the information they obtain informs their decision to buy a product. Mood-lifting health: The desire for internal pleasure is a key factor in determining which snacks consumers choose. As a consequence, products consumed to meet mood-lifting health needs (such as cheering oneself up, relaxing and unwinding, promoting mental harmony and balance, and feeling less stressed) are wide and expansive. Options range from fresh fruit to chocolate to wine. Personal health: Personalized health will undoubtedly continue to focus on meeting individual goals centered on proactive wellness, dietary sensitivities, and managing health conditions. Almost a quarter (24%) of consumers today select their foods or beverages to meet a wellness goal such as boosting energy, aiding digestion or enhancing skin, hair and nail health. While shifting needs and preferences are driving change in category and brand choices, at the heart of snacking is the need for gratification. Knowledgeable consumers are seeking the middle ground as the route to feeling satisfied, feeling neither guilty about their indulgent choices or that they're missing out with their healthier snack choices. As Canadians update and redefine their approach to snacking, opportunity abounds to factor these trends and behaviours into your growth strategies.  CG

Kathy Perrotta is a VP of Marketing with Ipsos Canada and leads the FIVE service, a daily diary tracking of what individuals ate and drank yesterday across all categ­ories/ brands, occasions and venues. Kathy.perrotta@ipsos.com


CANADA’S LEADING TISSUE MANUFACTURER HONOURED TO BE RECOGNIZED FOR OUR LEADERSHIP

krugerproducts.ca ©2018 All ® Registered and ™ trademarks of Kruger Products L.P. ®’Registered trademark of Kimberly-Clark Worldwide, used under license.


STORE PROFILE

OLD WORLD MEETS NEW WORLD Denninger’s stylish fifth store celebrates its European heritage while courting shoppers with cool new features By Chris Powell Photography by Jaime Hogge Patrick Denninger with Denninger's CEO, Mary Aduckiewicz

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June/July 2018 Canadian Grocer


IT’S LUNCHTIME AT THE NEWEST DENNINGER’S Foods of the World store in Burlington, Ont., just west of Toronto, and Patrick Denninger is manning a cash register as customers line up to pay for their flammkuchen (a German flatbread akin to pizza), loaded perogies and sausages. A third-generation grocer, Denninger is following in the footsteps of his grandfather Rudolf (who opened the first Denninger’s store in Hamilton in 1954), and his father Herman, who spent more than 40 years as a butcher with the family busi-

ness before retiring about five years ago. The younger Denninger served as project manager for the new store, which occupies one corner of a former Target store at the Burlington Mall. It’s located just up the street from its previous Guelph Line location, which it had occupied for several decades. On this mid-May afternoon, it has been just two weeks since the new store opened for business and one of the unanticipated challenges Denninger is grappling with is how to deal with all

the additional foot traffic coming from the store’s mall entrance. “We only put two cash registers at the mall entrance, assuming that most of our customers would park and enter via the main entrance,” says Denninger. “But it’s been busy, so we’re trying to guide lineups and figure things out on the fly.” Bright and airy, with wide centre aisles no higher than five feet in order to better facilitate in-store navigation (and eliminate the claustrophobic feeling common in older stores), the new 23,000-sq.-ft. June/July 2018 Canadian Grocer

25


STORE PROFILE location is more than double the size of its predecessor and establishes a template for future Denninger’s locations. “The complaints we heard from our customers [at the old store] were that the aisles were too narrow, it was difficult to navigate, and [a lack of] parking,” says Denninger’s CEO Mary Aduckiewicz. “We think we’ve solved those problems.” The new store marks the biggest investment in the company’s history, and the design by Burlington-based architectural firm Studio Intersekt oozes class and refinement. It nods to the company’s European heritage, with some of its black-and-white signage in German— such as “käse” (cheese) and “metzger” (butcher)—while its rear wall features a series of arches that Denninger likens to those found in a European train station. Other playful touches include washroom signs bearing the words “Herren” (men’s) and “Damen” (ladies), with the men’s sign featuring a figure wearing a traditional Bavarian hat complete with a feather in the side. “We’re trying to rebrand ourselves a little bit to attract the next generation [of shoppers],” says Denninger. “That was a big focus with

the design elements of this store—how do we bring some European flair to it while making it fun?” The store is also a testament to Denninger’s longstanding expertise in meat, with about 40% of its total footprint given over to meat and seafood counters. That includes a broad selection of sausages and other cured meats produced at Denninger’s 60,000-sq.-ft. manufacturing plant in nearby Hamilton. As with many new grocery stores, much of the action at Denninger’s is around the perimeter, which, in this case, houses a dedicated sampling space and a seafood counter operated by Caudle’s Catch, a family-owned business based in Kitchener, Ont. It’s the first fresh seafood counter in Denninger’s history, part of the company’s objective to become a one-stop food destination for its customers. “We’re meat experts, so we decided to bring in a seafood expert,” says Denninger of the partnership with Caudle’s. “They have a lot of the same values we do, so the partnership has been working out really well.” The store also houses a modest, 800-sq.-ft. fresh produce section, which

offers the essentials such as bananas, tomatoes, peppers and onions. “Produce for us is a complementary item,” says Denninger. “We offer the essentials so you can finish your meal and don’t need to go to another grocery store to pick them up.” The bakery department, meanwhile, offers a broad, enticing selection of European pastries and breads, such as a wide variety of ryes, plum doughnuts, tarts and more. “There’s more and more competition these days, so you need to have something unique,” says Denninger. The centre aisles also feature an expansive array of European products including jams and spreads from Copenhagen’s Danish Selection ($4.99 for a 305 mL jar) and marzipan from Niederegger in Lübeck, Germany. “Marzipan is a pretty unique item, and a lot of people come to us for our selection,” says Denninger. The store is also a year-round home to about 20 SKUs from Scottish cookie brand Walkers Shortbread, a number that typically expands to 30 or 40 around the holidays. “You don’t get that selection anywhere else in Canada,” says Denninger. “What keeps our grocery department unique is the vast variety.”

Designed by Studio Intersekt, this store marks the biggest investment in Denninger's history

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June/July 2018 Canadian Grocer


The in-store bistro offers European-inspired fare such as schnitzel, charcuterie and flammkuchen

The Facts Denninger’s has created a new in-store dining area called the Bitehaus Bistro, which offers European-inspired fare such as chicken and pork schnitzels, charcuterie featuring Denninger’s meats, and an assortment of flammkuchen that includes a traditional “flamm” consisting of a sour cream base with bacon, swiss cheese and onions that costs $4.99 for a slice. In an effort to appeal to the dinner crowd, there's beer and wine on the menu as well. “We figured that the only thing our sausages and schnitzel were missing was a cold beer,” says Denninger. “We’ve always been known as a lunch destination … but our other bistros are more cafeteria-like. Here, the décor and the furniture are geared towards more of a dinner atmosphere.” One of the key objectives with the new store is expanding Denninger’s core customer base, which traditionally has been comprised of European immigrants who arrived in Canada after World War II and sought out food items from their homeland. The store remains popular with customers from as far away as

Toronto and Buffalo, who make special trips to the store for hard-to-find items. Denninger says the company is now working to appeal to younger families who simply appreciate good food. “More and more customers these days want to know where their meat is coming from, or what goes into certain products,” says Denninger. “The biggest challenge is not being as well-known outside of our general area. It’s about getting them to discover us.” While the company bills itself as a destination for the “everyday gourmet,” Denninger says a challenge is getting customers to recognize that high quality doesn’t always mean high prices. “We do feel that you’re getting a good quality product for a fair price,” he says. Denninger’s now operates five grocery stores that serve communities in Burlington, Hamilton and Oakville, and has no immediate plans to expand. “We want to make sure that everything works,” says Denninger, “and we need at least six to 12 months to really know that everything is running efficiently and productively.”  CG

Location

Burlington, Ont. Size

23,000 sq. ft. Specialties

German specialty items, expertise in meat including a broad selection of sausages and other cured meats, European bakery items, fresh seafood counter, licensed bistro, and good quality at a fair price

June/July 2018 Canadian Grocer

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COVER STORY

Meet 2018’s outstanding women in grocery

STAR WOMEN AWARDS By David Brown and Rebecca Harris

One was an elementary school teacher who went on to start a chain of natural food stores. Another is a trained chef-turned-entrepreneur who launched a successful healthy snack company, while yet another oversees a billion-dollar portfolio at one of the country’s major CPG companies. These are just a few of the outstanding women among our 2018 Star Women winners. In its seventh year, Canadian Grocer’s Star Women awards recognize exceptional women who demonstrate influence, innovation, dedication and leadership in the grocery business. From the store level to the c-suite on both the retail and manufacturer sides, these women are shaping and redefining the Canadian grocery business at a dynamic, rapidly-changing time for the industry. Nominated by industry members and chosen by Canadian Grocer editors and a panel of past winners, we are proud to introduce this year’s impressive group of 19 Star Women.

Julie Bednarski PRESIDENT & FOUNDER

The Healthy Crunch Company

In early 2014, Julie Bednarski spotted a business opportunity. The trained chef, registered dietitian and ambitious entrepreneur was exploring a few different kale chip brands. As a foodie with a fondness for healthy, crunchy snacks, she liked the idea of kale chips but was unimpressed with what she was eating. “I thought, I can make this a lot better.” And she set out to do just that. Bednarski rented space in a commercial kitchen and started making and selling her own kale chips. In 2015, someone with a connection to Starbucks tasted her chips and recommended them to the coffee giant. “That is how my growth started.” Today, with its own facility, The Healthy Crunch Company employs 55 people, and has sold more than $1 million in product at more than 25,000 distribution points across Canada—including most of the major grocery chains. Bednarski has plans to expand into the U.S. soon, and later this year Healthy Crunch will introduce coconut chips, clusters and nut-free trail mixes. June/July 2018 Canadian Grocer

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Congratulations to

Tebbie ChuChla for her leadership, entrepreneurship and dedication in the grocery industry.

Conagra Brands would like to congratulate all the winners of the 2018 Star Women in Grocery!

Tebbie Chuchla, Head of Marketing, Conagra Brands

conagrabrands.ca


COVER STORY

Cynthia Beretta FOUNDER

Beretta Farms

Cynthia Beretta is a true pioneer, having founded Beretta farms in 1992—long before organic meat was trendy. “When we started farming, the concept of using pesticides and fertilizers or antibiotics and hormones in our animals was just foreign to us,” says Beretta, who started the company with her husband Mike. Over the years, Beretta Farms’ product offering has grown to include a variety of beef, chicken and pork products, as well as ready-made entrées, jerky, bacon, sausages and hot dogs. The business includes a catering operation called Beretta Kitchen, as well as an e-commerce business called The Frozen Butcher, which launched in 2016. As the business grew, Beretta Farms developed a network of ranchers in Ontario and Western Canada to meet demand. “What I’m most proud of is what we have been able to accomplish,” says Beretta. “Not only ourselves as ranchers, but the people we partner with; and being able to support Canadian ranchers across the country.”

Join us in celebrating our 2018 winners at the Star Women Awards Breakfast in Toronto on Sept. 25. Visit starwomen.ca for details and tickets.

Nicole Bleiwas

Lynn Caiger

FORMER VICE-PRESIDENT OF INSIGHTS AND MARKETING

SENIOR CATEGORY AND SHOPPER INSIGHTS TEAM LEAD

Flipp Corporation

Unilever Canada

Nicole Bleiwas has worked at top CPG companies for more than 20 years, with roles spanning sales, marketing and corporate strategy, but always with an analytics foundation. “By understanding and tapping into consumer motivations, needs and behaviours, I am able to identify brand and business growth opportunities,” she says. Bleiwas spent 13 years at Coca-Cola Canada where she played an instrumental role in developing the company’s approach to shopper marketing and revenue management. She also co-led the execution of on-premise and retail outlet activation for Coca-Cola during the 2010 Olympics—a career highlight for Bleiwas. She went on to hold senior roles at Canada Bread and Kraft Heinz Canada, and joined Flipp in 2017 as vice-president of insights and marketing, a position she recently left. At Flipp, Bleiwas was credited with transforming the way the company helps grocery retailers understand their consumers. “I was able to bring in traditional consumer research and marketing approaches that we would typically do in CPG, and apply them in a tech environment,” she says.

Lynn Caiger is one of Unilever’s most experienced and accomplished category management and shopper marketing experts. She combines more than 25 years of CPG sales experience—starting with Best Foods in the early ’90s—with an appreciation for how cutting-edge technologies such as virtual reality, eye tracking and artificial intelligence can improve performance and boost sales. On top of all that, Caiger runs programs to help women leaders develop within Unilever and has become the company’s leader on efforts to improve recruitment. “It started in 2011. We were suffering a talent gap,” she says. “So, I started to think about how we needed to approach bringing new young talent into the business.” The solution was a new university recruitment strategy that improved and expanded the intern program and campus visits to build relationships with top schools. “I see it as building our talent and marketing our industry, which is important because it is really a great industry to work in.” June/July 2018 Canadian Grocer

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TM/MD

Crave-able, Mouthwatering Meals Consumers are looking for high quality single-serve frozen meals Single-Serve Frozen Dinner Sales ($MMs) $291.3

30%

$287.8

YTD YA

Consumers want higher quality products

YTD

Nielsen Marketplace data YTD Jan–Aug, 2017

of category users are interested in seeing higher quality or gourmet prepared meals. Mintel, Product Innovation, 2016

Growing the frozen category Source of volume showcases ability to trade consumers up and grow the category.*

NO artificial colours, flavours or sweeteners Filling portion sizes with 20-30g of protein Available in five delicious meals

White cheddar Macaroni and Cheese with Bacon

Lasagna Alfredo with Bacon and Sausage

Creamy Chicken Enchiladas

Sweet & Tangy Pulled Pork with Spicy Sweet Potatoes

* Source: Nielsen BASES Concept/ Volumetric Test, Crave, March 2017

Turkey with Italian Sausage Stuffing


Congratulations

Dana on your Star Women in Grocery Award

Your leadership, creativity, focus on innovation and dedication to the grocery industry is inspiring. The entire Kraft Heinz family is extremely proud of your well-deserved recognition.

As a founding sponsor of the Star Women in Grocery Awards, Kraft Heinz congratulates all recipients on this outstanding achievement.

30

MARCH 2013 | canadianGrocer.com

special promotional feature


Lassonde is proud to recognize Josianne Légaré for her leadership, passion and dedication to the grocery industry. Congratulations Josianne! Josianne Légaré

Senior Vice-President of National Sales for Canada A. Lassonde Inc.

INNOVATIng

1918

SINCE

lassonde

Congratulations to all the winners of the 2018 Star Women in Grocery Award.


COVER STORY

Lyne Castonguay

Tebbie Chuchla

EXECUTIVE VICE-PRESIDENT OF STORE EXPERIENCE

HEAD OF MARKETING

Conagra Brands

Sobeys After more than 10 years working as a vice-president at Home Depot’s head office in Atlanta, Lyne Castonguay returned home to Canada in 2016 to join Sobeys as chief merchandising officer. Since then, she’s been a crucial contributor to the ongoing transformation of the company, laying the foundation for the national merchandising structure, stabilizing margins and sales, and playing a key role in creating the company’s Ocado e-commerce partnership. Today, as executive vice-president of store experience, she’s one of the most powerful women in the grocery industry. Castonguay attributes at least some of her success to her “humble” upbringing in New Brunswick, working for her father in his retail apparel business where she learned to always put the customer first. And she believes that no single leader knows everything. Better answers come from the collective brainpower of the team. “If I’m asked a tough question, I’m okay with saying, ‘Let me get to my team and we’ll have a good answer for you,’” she says. “I have always felt that if I surround myself with the smartest people I’ll be okay.”

Jacqueline Craig DIRECTOR, RISK MANAGEMENT AND FOOD SAFETY

Save-On-Foods (Overwaitea Food Group)

Throughout her 18-year career in CPG, Tebbie Chuchla has built a reputation for launching successful product innovations, creating breakthrough communication plans, and turning lagging brands into growing businesses. Chuchla, who joined Conagra in 2017, worked with various departments to transform the struggling Orville Redenbacher brand. The solutions included removing artificial colours, flavours and preservatives; a packaging redesign; and a strategic communication plan. On the innovation side, Chuchla played a key role in the development of Healthy Choice Power Bowls, which launched earlier this year. She’s also boosting Conagra’s e-commerce presence through partnerships with various grocers that offer online shopping. In her previous role as senior director of marketing at The Hain Celestial Group, Chuchla played a key role in recharging Yves Veggie Cuisine. As a leader, Chuchla tries to build confidence within her team members, so they can become leaders themselves. “I also try to encourage creative thinking that could lead to a big idea,” she says.

A 26-year veteran of Save-On-Foods, Jacqueline Craig is known as a trailblazer within the organization. Craig joined the company on the accounting side and moved to risk management in 2008, becoming department manager in 2014. She led her team’s business continuity plan, which hadn’t been fully updated since Y2K. With the new plan, Save-On-Foods now has documented procedures to guide the organization in the event of a disruption, such as a natural disaster, ensuring the company can continue to sell food and provide medications to customers. On the food safety side, Craig has modernized Save-On-Foods’ food-safety program, including preparing standard oper­ ating procedures for all new programs, as well as the introduction of a new auditing and compliance process. Craig is known for her caring style and mentorship. “In a leadership role, it’s not just about your accomplishments and what you’re doing task-wise, but it’s about what kind of effect you can have on people—even if it’s just with a smile and a short hallway conversation,” she says. June/July 2018 Canadian Grocer

35


CONGRATULATIONS Lyne Castonguay

Executive Vice President, Store Experience Lyne’s passion for retail and enthusiastic leadership have been driving forces of transformation at Sobeys and key ingredients in building the momentum the company has experienced over the past year. In her role as EVP, Store Experience, she continues to mobilize the team to raise the bar on customer experience at conventional store banners across the country (outside Quebec), setting her sights on delighting customers and bringing the Sobeys brand to life. Her passion for retail is matched by her motivating leadership style and infectious professional enthusiasm. We thank her for her immense contribution to the business and the industry.

Tammy MacPhee District Operator, PEI

Recognized as an exceptional leader, mentor, trailblazer and community advocate, Tammy’s expertise and drive contribute to growth in the grocery industry. Throughout Tammy’s 27-year career with Sobeys Inc., she has enthusiastically supported her teams and stores in celebrating milestones and reaching their goals. A true community champion, Tammy’s work has helped the Sobeys brand make a measurable difference in the communities in which team members live and work. Her work ethic, passion and professional integrity has won her the respect of the industry and her peers.

Congratulations to Lyne and Tammy for your dedication, leadership, innovation and contribution to the grocery industry.


COVER STORY

Janet Jacks FOUNDER

Goodness Me! Natural Food Markets

Janet Jacks founded and built a successful natural food market, but before that she was an elementary school teacher. She credits that early teaching experience for much of her success. When Goodness Me! opened in Hamilton in 1981, her husband Scott took care of the books, while Janet took care of each customer. “I taught people,” she says, explaining that people often want to eat better, but it’s not always easy. “I know how to communicate in a way that is easy to understand.” The business grew and the original location expanded several times before they opened a second store in 2005. Today there are nine stores with a 10th opening later this year. With her son managing the business, Jacks spends less time in the stores these days, but remains committed to teaching the Goodness Me! ethos. She’s written two books and is working on a third. After hosting a radio show for 20 years, she recently started “The Honest to Goodness Podcast” with her daughter. “My goal is to transform how people live their lives,” she says.

Sierra Johnston

Josianne Légaré

STORE MANAGER

SENIOR VICE-PRESIDENT OF SALES

Save-On-Foods, Yorkton, Sask.

At just 28 years old, Sierra Johnston is a rising star at SaveOn-Foods. After three years as a store manager in British Columbia, she was tapped to open one of the chain’s first Saskatchewan locations in early 2017. Her sales and merchandising ideas have been adopted by other Save-OnFoods locations, and her Yorkton store has delivered some of the chain’s best customer service metrics. Employees are expected to treat every customer like a guest in their home, says Johnston. “One of the culture statements we have at the store is that everyone is part of the family.” When she moved to Yorkton, she knew it was important to learn as much about her new hometown as possible, so she went to every community event going, including Lobster Fest, where attendees eat lobster (or steak) on the back of a flatbed truck, enjoy a beer and then go trapshooting. “I remember thinking this is what it’s all about,” she says. This year, Johnston’s Save-on-Foods supplied the lobster.

A. Lassonde

Josianne Légaré joined Lassonde in Montreal in 2005 and has worked her way up to become senior vice-president of sales: the company’s first-ever female national sales lead. In a previous role as director of Lassonde’s Western Canadian business, Légaré grew the business in that region from $5 million to more than $50 million in less than five years. Since taking over national sales in Toronto three years ago, she has turned around a declining juice business by rebuilding the sales team and better adapting to retailers’ needs. Légaré is past president of the Food Executives Club of Vancouver and is currently an active member of the Network of Executive Women. What she’s most proud of is mentoring the next generation of leaders—both women and men. “I want to inspire people and I love to see them grow, so that’s something that drives me personally,” she says. “That’s how I think I can make a difference.”

June/July 2018 Canadian Grocer

37


Congratulations to Jacqueline Craig and Sierra Johnston for their outstanding leadership, commitment and contribution to Save-On-Foods and the entire grocery industry. Congratulations to all of the 2018 Star Women in Grocery Award winners.


COVER STORY

Tammy MacPhee

Caroline Nadeau

DISTRICT OPERATOR

VICE-PRESIDENT OF SALES

Sobeys

Coca-Cola Canada

Tammy MacPhee got her start at Sobeys in 1991 as a 15-year-old part-time deli clerk in Charlottetown. Six years ago, she was made a store manager and last November she was named district operator overseeing all 13 Sobeys-run stores on Prince Edward Island. When she took on the store manager role in Summerside, MacPhee wanted to make some big changes to improve key metrics such as loss prevention, and become one of the best stores in the country. To do that, she felt she had to know everyone who worked for her. “I was always on the floor; I have the mindset that I lead by example,” she says. “I had 115 to 130 staff. I knew them all by name. I sat in the lunch room with them and developed relationships.” She talked to them about shared goals and explained that she was making changes but the changes were for the better—to improve sales and keep the business open despite new competition. In 2014, her store won the Sobeys Loss Prevention award for improving bottom line results, and a year later was nominated for Store of the Year.

Melissa Pryszlak DIRECTOR, LOGISTICS & ENGINEERING

Metro Ontario

One of Caroline Nadeau’s proudest moments was making the move from Montreal to Toronto for a job promotion with SC Johnson more than 20 years ago. “It was a huge decision, but I knew intuitively that to become the best I needed to learn from the best,” she says. Throughout her career, Nadeau has worked for some of the country’s top CPG companies including SC Johnson, Campbell Company of Canada and Dare Foods. Four years ago, she joined Coca-Cola Canada as director of sales and was promoted to vice-president of sales earlier this year. Nadeau is credited with growing the business by an average of 7% yearly over the last four years, compared to industry results that were typically in the 1% to 2% growth range. “My approach is to think about the broader issues our customers are facing and how our categories can play a role in solving those challenges over the long term,” she says. Nadeau is also the Canadian lead for Coca-Cola’s diversity and inclusion council, and is an active member of the company’s women’s council.

Last fall, Metro revealed a $400-million plan to overhaul and modernize its Ontario supply chain, including new frozen and fresh distribution centres. Melissa Pryszlak is spearheading that five-year project, overseeing design and layout and introducing significant, cutting-edge automation. After earning a degree in industrial engineering from Ryerson University in Toronto, Pryszlak spent a few years in the Alberta oil patch before coming back east, working first with UPS and then Walmart before joining Metro in March 2017. Her boss, Dan Gabbard, Metro’s vice-president of supply chain, calls her “a leader in the rapidly changing landscape of retail logistics, particularly in the area of distribution centre automation.” Automation—conveyer belts, elevators and robots—holds enormous potential to improve efficiency and make work easier for employees, says Pryszlak. That’s the part she loves most about her work: helping others do their jobs. “I like to talk to people. I like to go and ask them how I can help them,” she says. “I find a way to help them do it a little bit better.” June/July 2018 Canadian Grocer

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Longo’s would like to recognize

Congratulations to all of the 2018 Star Women winners!

Alicia Samuel

CANADA’S #1 GROCERY INFORMATION BRAND

for her influence, innovation, dedication and leadership in the grocery industry.

Congratulations on your 2018 Star Women Award!

StarWomanAd2018_Finall.indd 1

www.canadiangrocer.com

2018-05-31 4:14 PM

is proud to recognize

Melissa Pryszlak for her leadership, innovation, dedication and contribution to the grocery industry. Congratulations to all winners of Canadian Grocers’ 2018 Star Women in Grocery Award!


COVER STORY

Alicia Samuel DIRECTOR, IT BUSINESS SOLUTIONS

Longo Brothers Fruit Markets

In her four years at Longo’s, Alicia Samuel has built a track record of driving successful change and innovation at the company. Samuel co-led the biggest project ever executed at Longo’s: a three-year enterprise resource planning (ERP) transformation, including a merchandising ERP, a warehouse management system, demand planning, store ordering and receiving systems. The last of 10 projects will be completed in September. Samuel and her team spent considerable time in workshops to understand the pain points of the business and what they needed to look for in a platform. Samuel was also instrumental in guiding the business team through the complexity of software selection. An 18-year IT professional, Samuel previously held roles at Canadian Tire, Microsoft and IBM. “What I am most proud of is my team, how hard they work and what I continually learn from them,” she says. “I am also proud of my past accomplishments and learnings in my previous roles that have helped define me.”

Julie Sirois

Cheryl Smith

DIRECTOR OF BUSINESS DEVELOPMENT

GENERAL MANAGER, CHEESE & TABLESPREADS, FINE CHEESE & YOGOURT

PepsiCo Foods Canada

Julie Sirois joined PepsiCo Foods Canada in 2002 as a small format district sales leader. After a series of promotions, including becoming the company’s first female zone sales leader for Eastern Canada, Sirois was appointed director, go-to-market and sales capability in 2012. She was then promoted to director, warehouse retail sales in 2013. In this role, Sirois was integral to the development of a new retail execution tracking tool, delivering year-over-year growth on Quaker, Tropicana and Gatorade. As director of business development for Eastern Canada, a role she’s held since 2016, Sirois owns the business for PepsiCo Foods’ fourth largest customer—Metro—delivering $251 million in sales in 2017 for the Quebec and Ontario regions. Sirois is also the executive sponsor for the Eastern chapter of PepsiCo Canada’s Women’s Inclusion Network (WIN). “As a mentor of many PepsiCo women, I’m doing my very best to inspire women and enable them to achieve their career goals, as well as balance work-life quality,” she says.

Parmalat Canada Cheryl Smith oversees a billion-dollar portfolio at Parmalat Canada. Under her leadership, the company has achieved the status of having the No. 1 selling item within key dairy case categories including Cheestrings, Lactantia Butter, Black Diamond Cheese, Balderson aged deli cheddar and Astro yogourt. A 28-year CPG veteran, Smith led businesses for Unilever and Rogers before joining Parmalat in 1999. She held several marketing positions and joined the executive team in 2007. From 2009 to 2016, Smith held various executive vice-president roles and was appointed general manager, cheese and tablespreads, fine cheese and yogourt, in 2016. That same year, Smith initiated the Parmalat Canada Women’s Network, dedicated to supporting the advancement of women in leadership roles. Since 2015, she has been a mentor for the Women’s Executive Network wisdom mentorship program. “We must do more to include women in leadership in Canada and North America, where only about 20% of the senior executives are women,” says Smith. “The companies that are able to find ways to close that gap will gain a competitive advantage.” June/July 2018 Canadian Grocer

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COVER STORY

Dana Somerville VICE-PRESIDENT AND HEAD OF BRAND BUILD, INNOVATION AND R&D

Kraft Heinz Canada

Annette Woodhead

Chris Yu

FOUNDER

MANAGER, MARKETING AND MERCHANDISING

Blind Bay Village Grocer

In 1997, Annette Woodhead and her husband Colby left Saskatchewan and headed west. They intended to move to British Columbia, but they weren’t sure where. About an hour outside of Kamloops they noticed a burnt-out and abandoned store on the south shore of Shuswap Lake. It would soon become their new home. On that site, they built Blind Bay Village Grocer, a popular and thriving independent grocery business that has been recognized with awards from the Canadian Federation of Independent Grocers three times. “The gold [award] was the highlight of our career,” says Woodhead. A family feeling and a commitment to the community and its customers were what made their store a success. “If they asked for something we didn’t have, we would bring it in. If they needed it brought to their house, if they were sick or something, we would do that too,” she says. But now, after 20 years, the Woodheads will be stepping away from the Village Grocer. The couple sold the store in May. “I want to spend some time with the kids,” she says.

42

With a passion for marketing, Dana Somerville joined Kraft directly out of university in 1997. Over the years, she held progressively senior marketing roles, reaching vice-president level in 2016 and joining the leadership team in 2017. She’s modernized several Kraft Heinz brands by creating breakthrough campaigns including Cracker Barrel’s “Now This is Cheese” campaign and Kraft Peanut Butter’s “Stick Together” brand platform. This year, she led her team on product innovations such as Crave Frozen Meals and Max Boost, a coffee boasting 1.5 times more naturally occurring caffeine than other leading brands. One of her proudest accomplishments was her pivotal role in the launch of McCafé coffee into the grocery channel in 2014. “It was recognized with multiple awards both internally by Kraft and McDonalds, and externally,” she says. Somerville is always willing to roll up her sleeves to help her team, “but I also think it’s really important to empower people and give them opportunities, so I coach and push my team to bring out their best.”

June/July 2018 Canadian Grocer

Galleria Supermarket

A native of South Korea, Chris Yu moved to Canada in 2013 and joined Galleria Supermarket in 2016. As the retailer’s customer base expanded beyond the Korean community, Yu developed innovative programs to reach people from many different backgrounds. For the opening of Galleria’s third store in Oakville, Ont., Yu coordinated a Yelp Elite Event, inviting 40 Yelp reviewers to explore Korean culinary culture at the store. To better serve Galleria’s Chinese customers (its biggest non-Korean customer group), Yu led the rollout of WeChat Pay, a popular mobile wallet in China. In partnership with WeChat Pay, Yu introduced the Chinese Lunar New Year and year-round Red Packet campaigns, which reward customers with mobile “lucky money” on every purchase using WeChat Pay. In just two months, sales on WeChat Pay reached almost $100,000. Yu was also one of the first Canadian grocers to initiate a partnership with Uber Eats, starting with Galleria’s iconic “Mom’s Chicken.” “I think winning a Star Women Award will set another milestone for Galleria to stay innovative and active in engaging our customers and local communities,” says Yu.  CG


THE RISING POWER OF PRIVATE LABEL Grocers are making a big push on store brands to create differentiation and drive customer loyalty By Rebecca Harris

THERE’S A NEW SECRET WEAPON in the battle for shoppers: private label. Sure, store brands have been in retailers’ arsenals for decades now, helping penny-pinchers reduce the cost of their weekly shop. But private label is in the midst of a renaissance, as consumer perceptions shift and grocers create more distinctive products that hit today’s top food trends. According to Nielsen, private label continues to win over Canadians’ wallets, reporting five years of consistent share growth. Private label wrapped up 2017 with retail sales of $14.4 billion, which translates to a dollar share of 18.6%. “But when we convert to volume, or consumption, that share jumps to 23.6%: basically almost one quarter of what we consume is a private-label product,” says Carman Allison, vice-president of consumer insights at Nielsen Canada. Price remains the top reason why the majority of Canadians buy private label (64%), but trust and previous experience are also big reasons for many (23%). “Canadians share very positive attitudes toward private label,” says Allison. “When we asked consumers if private label is a good alternative to national brands, 70% responded positively. We also found high scores for equal quality (63%), good value (62%) and 34% of us

store brand

store brand

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June/July 2018 Canadian Grocer

store brand


PRIVATE LABEL are willing to pay more for our favourite private-label brand. This willingness to pay more has allowed retailers to take their private label up-market with more premium offerings and tiers.” The combination of value-conscious consumers and quality offerings can bring big benefits to retailers. While higher margins remain a compelling reason to offer private label, store brands are also emerging as a powerful differentiator and a way to drive customer loyalty. “Private-label brands certainly offer our customers a reason to shop in our banners, [which is] exclusivity and a point of differentiation from our competitors,” says Seanna Rishor, vice-president of private label at Sobeys, which has more than 9,000 private label SKUs, primarily in its Compliments line. “I like to call it a point of differentiation because there are very few retailers that don’t have private label. So, you have to have the right point of differentiation.” To ensure its portfolio continues to resonate with customers, Sobeys closely follows food and drink trends, such as the local food movement and the plant-based protein trend, says Rishor. Sobeys recently launched three varieties of frozen, plant-based burgers under Compliments: Carrot & Sweet Corn

Burger, Beet Burger, and Green Bean & Pea Burger. The company also looks for “white space” categories it needs more presence in, such as baby food. One recent example is the new Compliments Organic Baby Food pouches. “We are constantly renewing and refreshing our existing portfolio to ensure that we are delivering products that our customers want and need,” says Rishor. Saskatoon-based Federated Co-operatives Limited (FCL) is similarly in tune with consumer and food trends. When Sav Bellissimo joined the organization four years ago, its private-label portfolio consisted of the value-oriented Centsibles; Co-op Gold, a more premium line of products; and Market Town, a line of take-home products from the deli and bakery departments. “We knew we had to start playing in the ultra-premium space, and we were missing a health and wellness line,” says Bellissimo, store brands manager, food department. The result was Co-op Gold Pure, a line of food and cleaning products—including condiments, burgers, sauces and laundry detergent—that fall under three categories: Ingredients (products with no artificial, colours, flavours or preservatives), Clean (products with plant-derived ingredients) and Organic, as well

as sustainable seafood and fish products, and 100% Western Canadian pork and chicken raised without the use of antibiotics. FCL continues to expand Co-op Gold Pure, and recently launched Co-op Gold Pure pet nutrition, which contains no corn, soya or wheat. “Store brands is one of the keys to driving loyal customers because there’s a whole value component and there’s a lot more product innovation going on,” says Bellissimo. “We’re seeing a big food movement out there, with a trend toward upper-end, higher-quality food, and a lot of new and different flavours. And I think it’s hard for the big national brands to stay in tune with that. We are more in tune with our local community and we know what they want more than the [big CPGs].” With the health and wellness trend on the rise, FCL is also looking at the rise of plant-based protein. “The beauty of that product is it’s right in our backyard,” says Bellissimo. “Most of those ingredients are grown here in the Prairies, so I think that’s a big opportunity for us.” Metro is another retailer focused on private-label products that fit with consumers’ healthy lifestyles. Last year, Metro launched Naturalia, a line of about 100 products under its premium

store brand store brand

store brand

June/July 2018 Canadian Grocer

45


PRIVATE LABEL

Sobeys’ Compliments Green Bean & Pea Burger

You don’t have to be an established brand with decades of heritage. You can be a store brand with two years of transparency, trust and clean labels and that’s it.” Aligned with consumers’ need for health and wellness is the opportunity for private label to extend to store-branded produce and fresh options, notes Nielsen’s Allison. “Private label’s share of produce is lower than average (17.3%), growing at +3% but lagging national brand players, which are growing at +7%,” he says. “Extending the positive brand trust from the centre of the store to the perimeter of the store is a natural opportunity.” Longo’s private brands—which include a national brand equivalent and a premium tier called Longo’s Signature—are found in all departments, but are strong

46

June/July 2018 Canadian Grocer

Longo’s Signature Muffuletta Antipasto

in the fresh department, and bakery and deli especially, says Jenny Longo, director of private brands at Longo’s. For example, Longo’s recently won Product of the Year for its Signature Chocolate Truffle Mousse Cake. The grocer also recently launched its new “Impress” line of eight chef-inspired meal kits, which come with pre-portioned ingredients and preparation instructions in a handy box. “Having innovative  private-label introductions is a great brand builder for our private brands in our ultra-fresh departments,” says Longo. Retailers can also create differentiation by bringing a food or ingredient trend across a variety of categories. For example, Metro worked with a research firm to identify flagship categories for its store brands. The ones that emerged were ingredients such as maple syrup and fine vinegars, as well as products such as ice cream, cookies and condiments. “We decided to cross them and work with our suppliers to see what would be the result,” says Gibson. The result was a range of new maple syrup products for the Irresistibles line, including Maplelicious ice cream, maple cream flavoured cookies, maple butter, and cider vinegar with maple syrup, as well as maple syrup with crystallized ginger and maple syrup with vanilla bean. “That’s another advantage private brands have, because we can showcase a trend in a key category and bring it to other products and other areas of the store, where national brands are not able to do this,” says Gibson. “That is where the replication or imitation [of national brands] goes away. By bringing new trends into other categories, we create exclusivity and innovation. This is another way we’re able to offer differentiation and gain loyalty with our customers.” One threat that looms large for store brands is Amazon, which is said to be

doubling down on its private-label business. Through its acquisition of Whole Foods Market, Amazon is making its 365 private-label line available on Amazon. com. “But the biggest concern everybody should have is Amazon is ushering in what I’ve been calling the secret brand movement,” says Carol Spieckerman, retail consultant and president of Bentonville, Ark.-based Spieckerman Retail. “Amazon quietly and on a very large scale has launched piles of private brands across multiple categories over the last two or three years … Most of it is in non-food categories because ordering food on Amazon is still in the process of becoming a thing. But I expect their grocery private-label development to really accelerate as it has in other categories.” Cadent Consulting Group’s Stuart says Amazon’s move into private label is the single biggest “sea change” in the private-label space in general. “With Amazon and Whole Foods, there is an opportunity for significant private-label acceleration,” he says. “But that starts rippling out to what other retailers do. It’s kind of a huge catalyst: it’s not just the gain Amazon experiences, it’s what other retailers do either offensively or defensively in response to that.” Whatever challenges lie ahead, retailers see a bright future for private brands. “It’s an exciting time for private label and we’re entering into a new territory where we will have generations that will never have stepped foot inside a bricksand-mortar store,” says Sobeys’ Rishor. “So, we have to make sure we deliver on our brand promise. But how do we connect with that customer online? I think online will become a much bigger part of retail in Canada and could change the way we approach our private-label brand promise. It’s going to be a good challenge and a good problem to solve.”  CG Metro’s Irresistibles maple syrups and flakes

ILLUSTRATION, PREVIOUS SPREAD: GETTY IMAGES/SMARTBOY10

Irresistibles store brand. (Metro also has Selections, a national-equivalent brand.) Naturalia products, which focus on simple ingredients and nothing artificial, range from all-natural peanut butter to grain-fed chicken from a Quebec producer. “With our brands, we try to make sure that we touch all types of customers, but certainly we know millennials enjoy organic, natural and local products,” says Marie-France Gibson, vice-president, private brands at Metro. Indeed, millennials represent a big growth opportunity for private brands. A U.S. study by Cadent Consulting Group, found just over half of millennials (51%) said they have no preference between private label and national brands, compared to 39% of baby boomers who have no preference. “They didn’t grow up watching TV and seeing those traditional CPG brands advertised,” says Don Stuart, managing partner at the Wilton, Conn.-based firm. “They’re also driven by different values: transparency, simplicity and trust; which opens the door for private label.


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Seeking Protein? Here’s what 26 g of protein looks like

1 serving = 75 g Cooked Beef 1 26 g protein & 184 calories per serving Peanut Butter Approx 3.5 servings

Hummus Approx 2 servings

Black Beans Approx 2.5 servings

1 serving = 2 tbsp

1 serving = 3/4 cup

1 serving = 3/4 cup

7 g protein/serving (184 calories/serving)

14 g protein/serving (302 calories/serving)

11 g protein/serving (168 calories/serving)

1 serving (75 g) beef is an excellent source of protein.2 Beef, composite cuts, steak/roast, lean and fat, cooked. See www.thinkbeef.ca for nutrition information.

1 2

Eating Well with Canada’s Food Guide recommends Canadians enjoy a variety of foods from the four food groups, including a variety of foods from the Meat and Alternatives food group. Source of nutrient values: Health Canada, Canadian Nutrient File, 2015, food codes: Beef 6172, Peanut Butter 6289, Hummus 4870, Black Beans 3377.


AISLES

Products, store ops, customers, trends

PROTEIN SNACKS

Beefing up on meat snacks

SHUTTERSTOCK/KRZYCHO

Innovation and a growing appetite for protein are boosting meat snack sales By Rosalind Stefanac

I

t wasn’t long ago that beef jerky and other meat snacks were relegated to the gas station, purchased primarily by road trippers looking for a last-ditch energy fix. But thanks to an overhaul of ingredients and flavours, more and more consumers are giving traditional savoury snacks the boot in favour of protein-packed meat options—and they’re turning to the grocery store to find them. Isabel Morales, consumer insights manager at Nielsen, says grocery stores and mass merchants have seen a whopping 15% dollar growth and 18% volume growth in the meat snacks category in the last year alone in Canada. “This means consumers are putting more of these snack types in their baskets,” she says. Analysts note that jerky products and other meat snacks target a growing demand for low-carb, high-quality protein that’s quick and portable. “This is a real growth opportunity, and from what I’m hearing the interest is there,” says Joel Gregoire, associate director, food & drink at Mintel. He’s not surprised by the June/July 2018 Canadian Grocer

49


AISLES stats. “Meat snacks tick off a lot of those boxes when it comes to what consumers are looking for in snacks.” Morales says the dollars in this category are fuelled by consumers between the ages of 35 to 54 with household incomes of at least $70K. “The presence of kids seems to be a driver of purchases as well, as consumers with kids between [ages] six and 12 are driving volume,” she says. Going forward, she says innovations in pack sizes and meat snack flavours will be key for continued growth. “More and more, we see manufacturers that are making an effort to appeal to a broader audience,” says Morales. “Calling out health and environmental attributes seems to be getting the message across, especially to consumers who are invested in their particular diet preferences.” A HEALTHIER OPTION ON THE GO With an increasing number of meat snacks boasting grass-fed, lean cuts of beef, it’s not only consumers who are taking notice. “In the past, we wouldn’t have featured these products in our merchandising plans because of the health aspect, but when we listed Lorissa’s Kitchen [which sources only 100% grass-fed beef], for example, and compared it to chips and other snacks, it has big health benefits,” says Mitch Yeatman, category manager at Ontario’s Longo’s. “Customers are reading labels and realizing this isn’t the ‘dirty’ meat that they perceived it to be.” With ongoing health concerns around sugar, consumers are also looking at “minimally processed, wholesome snacks that fill them up and don’t make them think of sweets,” says Amar Johal, vice-president of sales at B.C.-based Freybe, which has been producing meat snacks for Canadians since 1955. “We as manufacturers in the meat snack area are looking at lower-sodium [and] lower-nitrate options based on this growing health movement,” he says. Given consumer demand, some grocers are even taking production into their own hands. At Red Barn Market’s central location in Victoria, B.C., there are three large smokers running 24/7 to produce all-natural, primarily island-sourced meat products for its seven stores. The grocer makes eight varieties of pepperoni alone and recently introduced a whole-muscle jerky. Authenticity of ingredients is a key factor consumers are asking for, adds Stephanie Egan, marketing manager at

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June/July 2018 Canadian Grocer

the younger set offering bold flavours with a kick. The company is introducing Duke’s meat snacks to Canadians over the course of the summer, with some flavours expected to resonate with female shoppers, such as Hickory Peach BBQ. For those looking to avoid red meat altogether, there’s a slew of alternatives like Hot Smoked Maple Salmon nuggets from Premier Seafoods, or Rosemary Turkey Sticks and Herb Citrus Turkey Bars from Country Archer Jerky Co. This fall, Freybe will be launching its new Wander product, featuring Buffalo-style chicken bites. Vegetarian snackers aren’t being shafted either, with companies like Hungry Buddha in Montreal offering jerky options made from coconut. “I just came back from the Natural Product Expo West trade show and there was every type of jerky represented, so it’s definitely a growing trend,” says Longo’s category manager Carlo Noce. “As jerky becomes more popular, we will certainly revisit how much space we’re dedicating to these types of products.”

Waterloo, Ont.-based Piller’s Fine Foods. “Piller’s still smokes its meat over natural hardwood fires and is free of allergens— and we call that out on the package.” Innovation in packaging is another selling feature. In 2016, Piller’s launched its Salami Chips to appeal to snackers on the go. “They come in a resealable pouch and take the work out of salami because there’s no slicing,” says Egan. Similarly, the brand’s longer/skinnier Salami Whips appeal to kids looking for a fun snack that’s easier to chew than traditional jerky. A NEW TAKE ON BEEF Flavour innovation has been key to category growth as well. Companies like New York-based Three Jerks cover the gamut of palates from Memphis BBQ to Maple Bourbon Churro and Filet Mignon. Meanwhile, Conagra’s Slim Jim (which just relaunched in Canada) appeals to

GROCERY AS A MEAT SNACK DESTINATION As this trend continues, manufacturers in the category say grocers would do well to put meat snacks in a few key areas throughout their stores. That could be the snack aisle beside the chips and other savoury fare, paired with cheeses or wine (where available), or even right at the checkout. “When you look at the U.S., they really are leading with meat snacks and putting jerky as an identifier in their aisles,” says Freybe’s Johal. “Here, people are also doing more entertaining at home with charcuterie on a Friday night as their meal, so they’re looking for ideas.” At Red Barn Market, where dry meat snacks are merchandised in the middle of the snack aisle, the grocer has experienced double-digit growth in the category over the last year. And Longo’s has seen sales of meat snacks increasing heavily since it started listing brand leader Jack Link’s products in its stores three years ago. In a category where 50% of product is sold on impulse and the profit margins are high, it makes sense to put these snacks at the grocery checkout and add a frontend secondary display, says John Loaiza, senior insights manager at Jack Link’s. “This is especially important during the summer months when jerky sales peak,” he says. “[Grocers] gain the potential of 50% more sales.” CG


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AISLES

The ginger boom People around the world have been consuming ginger for thousands of years, often as a remedy for ailments ranging from upset tummies to colds and flus. But in the last few years, this ancient spice has undergone an undeniable boom in popularity with ginger finding its way into sodas, teas, juices, energy bars, snacks, frozen meals and more. Here are just a few of the on-trend ginger products showing up on grocery store shelves: SKRATCH LABS The Ginger & Miso Anytime Energy Bar from Colorado-­ based Skratch Labs is a savoury snack made from a blend of candied ginger with red pepper flakes, soy sauce, golden berries, sesame seeds and almond butter. The bars contain no artificial sweeteners, colouring or flavouring, and are also non-­­GMO, vegan, kosher and gluten free.

VIJ’S Part of Vij’s line of frozen Indian foods—created by renowned Canadian chef Vikram Vij—Vij’s Coconut Ginger Green Beans combines ginger and onions with a spicy coconut taste. Suitable for vegans as well as people on dairy- and gluten-reduced diets, this frozen vegetable curry contains no artificial flavours or colours.

GOURMET GARDEN Gourmet Garden’s Lightly Dried Ginger is ideal for consumers who want to easily add real ginger to their stir-fries, curries, dressings, juices, cookies and more. Australia-based Gourmet Garden (now owned by McCormick & Company) describes it as fresh ginger that’s been dried “just enough” to last four weeks once opened. And because it’s only lightly dried, it offers a flavour and aroma that’s as close to fresh ginger as possible.

Cold-pressed innovation

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June/July 2018 Canadian Grocer

RED BULL

CEDAR

When you hear the name Red Bull, you likely think “caffeinated energy drink”—but think again. The brand recently branched out by launching a new line of organic carbonated soft drinks that includes a zesty ginger ale. Organics by Red Bull Ginger Ale is caffeine free with a nice spicy taste, thanks to the natural flavouring of ginger extract mixed with bergamot and concentrated lemon juice.

Toronto-based Cedar Juice offers six cold-pressed juices that feature ginger in a starring role, including Zest of the Bunch (with orange, grapefruit, turmeric and ginger), Maca Sun (with orange, carrot, ginger root and maca), and For the Love of Greens (cucumber apple, spinach, celery, lemon, swiss chard and ginger root). Cedar juices are all unpasteurized; instead, the cold-pressed method is used to max­imize the nutrients in every gulp.


AISLES

LOOKING GOOD, FEELING GOOD

NEW ON SHELF!

From nutritious to better-for-you to downright indulgent, check out these three new products hitting Canadian grocery shelves.

Whether it’s shampoo and soap for the shower, sunscreen for summer days, nail care, razors, or any of the other personal hygiene products sold in grocery stores, health and beauty aids (HABA) are something that most Canadians rely on. This Nielsen data reveals how various HABA categories have been performing.

KASHI JOI Clean and tasty nut-based snack bars

Health and beauty aids (HABA) - 52 weeks, ending March 31, 2018 $ Sales (000s)

Units (000s)

Units Vol % Chg

BODY WASH

279,278,479.0

3

59,348,694.7

1

CONDITIONER

222,431,278.0

1

39,605,140.5

-1

1. COSMETICS - NAIL

92,358,092.0

-8

15,483,109.2

-12

42,310,855.0

-2

12,235,971.8

-0

928,897,687.0

6

67,376,769.6

6

19,171,207.0

-3

4,175,299.9

-4

19,939,434.0

-5

4,217,472.5

-5

COTTON SWABS 2. FACE CARE HAIR GEL 3. HAIR MOUSSE HAIR SPRAY

67,102,609.0

-5

13,149,857.6

-5

282,098,224.0

2

35,135,359.0

-1

COTTON PADS

15,097,307.0

8

5,500,976.8

5

NAIL PRODUCTS

25,313,837.0

-5

5,212,659.8

-7

319,694,503.0

1

82,109,874.4

-1

RAZORS FEMALE

21,044,795.0

-3

2,266,305.7

3

RAZORS MALE

26,613,950.0

-7

2,995,839.9

4

HAND & BODY MOISTURIZERS

PERSONAL DEODORANTS

4. SANITARY PROTECTION - PANTS & CUPS

GETTY IMAGES/EVGENIY SKRIPNICHENKO

$ Vol % Chg

6,726,119.0

18

180,019.7

3

SANITARY PROTECTION - SANITARY PADS

254,589,245.0

1

44,392,543.9

-2

SANITARY PROTECTION - TAMPONS

110,965,339.0

-5

17,111,467.8

-4

SHAMPOO

392,921,413.0

3

69,617,039.3

0

SHAVE PREPARATIONS

57,290,709.0

-3

17,805,716.1

-2

SUN CARE PRODUCTS

195,813,000.0

1

17,334,328.5

-1

1. Are polished nails out of fashion?

Sales of nail cosmetics have shown a significant drop of 8% in dollar volume and 12% in units in the latest 52 weeks ending March 31, 2018.

2. It’s all about that face. Sales of face care products are up by 6% in both dollar and unit sales, reaching nearly $929 million in sales in the last year alone.

3. The hairstyles, they are a changin’. Hair

mousse has declined by 5% in both dollar sales and units, as has hair spray. Hair gel is also down by 3% in sales and 4% in units.

4. Innovation in the feminine sanitary

protection category appears to be paying off; pants and cups are up 18% in dollar sales growth .

Featuring clean and simple ingredients, Kashi joi Nut Bars and Almond Butter Energy Nut Bars come in six palate-pleasing flavours, including Raspberry Dark Chocolate Hazelnut, Pistachio Fig & Lemon, Banana Chocolate Nut, and Blueberry Maple Pecan.

BAVARIA 0.0% Non-alcoholic beer straight from the Netherlands As the alcohol-free beer trend grows, Dutch family brewer Bavaria has launched its nonalcoholic beer in Canada. The internationally popular brew is now available on this side of the Atlantic in two varieties: Bavaria 0.0% Original and Bavaria 0.0% Wheat.

MISS VICKIE’S SWEET SOUTHERN BBQ New sweet and spicy chip flavour Combining a sweet barbecue flavour with an extra kick of heat, Miss Vickie’s new Sweet Southern BBQ chips are a savoury, sweet, spicy snack that Miss Vickie’s is promoting as a perfect treat for a date night on the couch with a bottle of wine.

SOURCE: NIELSEN, NATIONAL, ALL CHANNELS, ALL SALES, EXCLUDING N.L.

June/July 2018 Canadian Grocer

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Miniature vegetables

It’s a small (veggie) world Mini veggies are shaping up to be a big hit in the produce section By Danny Kucharsky

GETTY IMAGES/KAANATES

IN THE WORLD OF VEGETABLES, it’s no longer all about “the bigger the better”—these days, the phrase “good things come in small packages” is just as likely to apply. Walk through any grocery store and you can tell that miniature vegetables are growing in popularity, says Sue Lewis, vice-president, market development at the Canadian Produce Marketing Association (CPMA) in Ottawa. Often sold in packaged versions, mini veggies are attracting children and adults alike, she says. The small portion sizes of mini veggie snack packs work well as healthy lunch items for children, while adults like the grab-and-go convenience of the snack packs. The smaller sizes of mini veggies also meet the needs of seniors and singles tired of having to throw out vegetables they don’t get around to eating. “These items are saving people time and solving problems for people,” says

Frank Yunace, store operations manager at Pete’s Fine Foods in Halifax. According to Mintel’s Vegetables and Fruit – Canada – May 2017 What’s Working report, 31% of Canadians say they are interested in “portable snack size packs,” and mini veggie snack packs are well positioned to please the 37% of parents who agree that it’s “difficult to get children to eat vegetables.” Miniature veggies can run the gamut from cucumbers and tomatoes to peppers and avocados. Last year, Pure Flavor launched Mini Munchies veggie packs to meet the increasing demand for small vegetables in convenient snack sizes, says Chris Veillon, chief marketing officer at Pure Hothouse Foods in Leamington, Ont. The four-ounce veggie packs are “100% branded towards kids” and include bite-sized tomatoes, peppers

and cucumbers featuring characters like Poco the Cocktail Cucumber. They sell for a suggested retail of $1.99 in Canada and “can be seen as a premium but an affordable item,” says Veillon. Also in 2017, Mission Produce launched a line of mini avocados. Dubbed “small but mighty,” the minis tap into consumer demand for snack size or single-serving portions, says Brent Scattini, vice-president of sales and marketing at the Oxnard, Calif.-based company. At 100 to 120 calories each, the mini avocados are the perfect size for avocado toast, baby food, smoothies or omelettes, he explains. They’re sold in six count or two-pound configurations by a handful of major U.S. grocers, but are not yet sold in Canada. Scattini says most grocers carry regular-sized produce in single, organic or bagged offerings, and he admits mini veggies represent “an additional bagged offering that doesn’t necessarily fit every retailer’s marketing strategy.” He adds that the mini avocados are not cannibalizing other SKUs. “All we’ve seen it do is increase overall sales at those retailers who put it on the shelf.” Yunace agrees. “I think everything has a niche,” he says. “People who are a little bit more adventurous or who are looking to save time are going to go after some of those smaller products.” What’s more, mini veggies don’t require special promotions to sell, he says. “We just promote them as regular products on our shelves or in our merchandising displays. We don’t promote them as mini vegetables.” That said, suppliers are providing retailers with merchandising options for June/July 2018 Canadian Grocer

55


FRESH

their mini veggies. Mission Produce, for example, offers grocers bag display racks for its mini avocados, and the packaging “is really eye catching,” Scattini says. Meanwhile, bin displays for Mini Munchies “are branded with high-­impact creative that makes it an attractive display to have in the produce aisle,” explains Veillon. Given their convenient size, however, Mini Munchies can live in a variety of locations in grocery stores, including check-out lanes, he says. CPMA’s Lewis, who buys mini tomatoes, cucumbers and peppers, thinks mini veggies are more than just a trend. “I think it’s going to continue to grow,” she says, noting that the rising popularity of snacking rather than eating three meals a day puts mini veggie snacks in good stead. Prices for mini vegetables are comparable to regular-sized vegetables, she notes, and “if it’s something that makes it easier to make a healthier snack choice on the go, it’s worth it to pay that premium.”  CG

Fresh innovation The CPMA Show in Vancouver was awash in cool, new valueadded produce items It’s no secret that value-added products are driving growth in the produce department. For time-squeezed consumers, value-added items meet the need for convenience while also helping to make healthy eating easier. From cauliflower mash kits to veggie-based meal bowls, there were plenty of new value-added products on display at the recent CPMA Show. Perhaps it’s no surprise, then, that value-added items had a big presence among the show’s Best New Product awards. Here’s a look at the winners

INSPIRED SALADS by Star Produce/ The Star Group was named Best New Product at the 2018 CPMA Show

ORGANICGIRL SALAD DRESSINGS won Best New Organic Product at the produce show

RELIABLE FOOD PROCESSING EQUIPMENT

www.birosaw.com

FORMED FRESH DAILY

The CPMA Freggie Approved Award went to Mucci Farms for its CUTECUMBER POPPERS

Model F2000N

Versatile Food Former with optional detachable product feed tray Select a popular mold shape, other shapes available. Adjustable product thickness up to 3/4" on all Molds.

Round

282RB-8-17

Oval

Square

Nugget

YOU MAKE ME PASTA KITS from Mastronardi Produce (Sunset) nabbed the Best Packaging Innovation Award


CHECKING OUT George Condon

Grocers are testing the tech behind Bitcoin to see if it can make our food supply safer

THERE’S BEEN a lot written in recent months about blockchain’s potential to transform everything from banking to law enforcement. I wondered: how might this technology affect the grocery industry? Investopedia defines blockchain as “a digitized, decentralized, package of all product transactions.” That should mean blockchain has the potential to revolutionize communication between buyers and sellers of grocery products by permanently storing all the data from a transaction such as quantity, price, delivery date, bar code, package measurements, source of the ingredients and so on. One key benefit of blockchain is that it allows for near-instant traceability. And traceability may very well be the trigger to bring blockchain into wider use in the grocery industry. A while back, Walmart tested blockchain on sliced

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June/July 2018 Canadian Grocer

mangoes from Mexico. Without blockchain, it took almost seven full days to trace a package of the fruit back to its original source. With blockchain, it took just 2.2 seconds. Just imagine how blockchain could be used in food recalls and for food safety. A contamination risk could be headed off in seconds. Retailers such as U.S. grocer Kroger and Chinese online giant Alibaba are also testing blockchain. Grocery consultant and author Michael Sansolo says: “Blockchain discussions are picking up, but I’ve yet to encounter anyone really well versed or immersed in the topic. The recent romaine lettuce problem in the U.S. points to the importance of using technology that enables such great (and relatively safe) sharing of information. And there seems to be some thought that food safety issues could

George Condon is Canadian Grocer’s consulting editor. He’s based in Toronto. condug@sympatico.ca

IBM

WILL BLOCKCHAIN CHANGE GROCERY?

give blockchain more of a push.” I also asked Kantar Consulting’s senior vice-president of retail insights, David Marcotte, for his take. “Blockchain as a base concept is very difficult for most retailers,” he says. “When faced with the duplicating and replacing [of] all those existing procurement processes, it rapidly overwhelms a normal-sized retailer.” At this moment, blockchain seems to make more sense for manufacturers, particularly those that are looking at direct-to-consumer sales. Manufacturers such as Dole Foods, Driscoll’s and Tyson Foods are investigating blockchain and, along with Walmart and Kroger, are collaborating with IBM to pilot blockchain to “further strengthen consumer confidence in the global food system.” Startup INS Ecosystem is also planning a solution that aims to leverage the power of blockchain to “reinvent” the grocery industry. For many companies, says INS CEO Peter Fedchenkov, the days of full truckloads as the minimum consignment are over as they might just want to ship a single pallet. INS has a platform to connect manufacturers with consumers via a network of fulfillment providers that are linked via blockchain; the idea is this approach will overcome the inefficiency of current supply chain processes and reduce costs. Blockchain also reimagines the idea of farm-to-table. It documents all of the business-to-business relationships that lead up to the final business-to-consumer transaction. It may soon help consumers see exactly when their food was grown, what sorts of pesticides and antibiotics were used and how it compares to other products on the shelves. An educated consumer would only need her smartphone to determine which grocery item is the cleanest, healthiest and most ethical. It’s too soon to tell the exact impact of blockchain on the grocery industry, but there are many who are determined to ensure it does make an impact.  CG


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Canadian Grocer - June/July 2018  

Canadian Grocer - June/July 2018