Octane English - May/Jun 2021 by ensembleiq

ALL IN THE FAMILY Quebec’s Groupe Milot ﬁnds success amid a pandemic MAY/JUNE 2021 CCentral.ca @CSNC_Octane PM42940023 • $12.00

THE SOFTER SIDE OF BRUSH TECHNOLOGY

FUEL DISPENSERS TAKE MERCHANDISING TO A NEW LEVELS

NO STAFF, NO PROBLEM WITH UNATTENDED FUEL SITES

PROTECTING THE ENVIRONMENT

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MAY/ JUNE 2021 Volume 26 | Number 3

CONTENTS

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Editor’s message The future is here

Brushes with greatness Car wash brushes show their softer side with new tech

Pumping innovation New fuel dispensers deliver more than gas

COVER STORY All in the family Quebec's Milot family look to the basics to steady business during the pandemic

No staff, no problem Unattended fuel locations are safe, convenient and offer a competitive edge

Training pays Staff training helps generate profits and creates customer satisfaction

Featured products New products, equipment and services

CCA industry forum

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EDITOR’S MESSAGE

20 Eglinton Ave. West, Suite 1800, Toronto, ON M4R 1K8 (416) 256-9908 | (877) 687-7321 | Fax (888) 889-9522 www.CCentral.ca SENIOR VICE PRESIDENT, CANADA | Donna Kerry EDITORIAL EDITOR & ASSOCIATE PUBLISHER, CSNC Michelle Warren | mwarren@ensembleiq.com EDITOR, OCTANE Kelly Gray | kgray@ensembleiq.com TRANSLATION | Danielle Hart ADVERTISING SALES ASSOCIATE PUBLISHER Elijah Hoffman | ehoffman@ensembleiq.com VICE PRESIDENT, EVENTS Michael Cronin | mcronin@ensembleiq.com DESIGN AND PRODUCTION SENIOR VICE PRESIDENT, OPERATIONS Derek Estey | destey@ensembleiq.com DIRECTOR OF PRODUCTION Michael Kimpton | mkimpton@ensembleiq.com ART DIRECTOR | Linda Rapini DIRECTOR OF MARKETING, BRANDLAB Alexandra Voulu | avoulu@ensembleiq.com SENIOR DIRECTOR AUDIENCE STRATEGY Lina Trunina | ltrunina@ensembleiq.com SENIOR DIRECTOR, DIGITAL CANADA & SPECIAL PROJECTS Valerie White | vwhite@ensembleiq.com CORPORATE OFFICERS CHIEF EXECUTIVE OFFICER | Jennifer Litterick CHIEF FINANCIAL OFFICER | Jane Volland

CHIEF INNOVATION OFFICER | Tanner Van Dusen CHIEF HUMAN RESOURCES OFFICER | Ann Jadown EXECUTIVE VICE PRESIDENT, EVENTS & CONFERENCES Ed Several

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Please contact Wright’s Media | ensembleiq@wrightsmedia.com 1-877-652-5295 CONVENIENCE STORE NEWS CANADA / OCTANE is published 6 times a year by EnsembleIQ. CONVENIENCE STORE NEWS CANADA / OCTANE is circulated to managers, buyers and professionals working in Canada’s convenience, gas and wash channel. Please direct inquiries to the editorial ofﬁces. Contributions of articles, photographs and industry information are welcome, but cannot be acknowledged or returned. ©2020 All rights reserved. No part of this publication may be reproduced in any form, including photocopying and electronic retrieval/retransmission, without the permission of the publisher.

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The future is here Technology is reshaping the forecourt experience like no other time. Key to this change is four dynamic elements: Zero-emission vehicles and the move away from fossil fuels; Dispenser technology and fueling station formats; The rise of autonomous car and trucks; and Digitally connected vehicles. Together these technologies will take fuel retail to a new era that is more customer responsive and laden with profit opportunities. Zero-emission vehicle sales growth is creating infrastructure development. Most common is electric vehicle (EV) charging, a system that offers retail operators the chance to have captive customers while cars and light-duty trucks are being powered. Hydrogen is also making a play. For example, five retail fuel sites have recently opened in B.C.’s lower mainland. Currently, hydrogen is a viable option as an alternative fuel, especially for highway transport and passenger service. B.C. has been leading the way with global players head-officed in the province. Look for more action on the hydrogen front from companies such as 7-Eleven and Shell. Fuel dispensers have come a long way over the more than 100 years they have been in use. Once, all a fuel dispenser did was pump gas and inform motorists on how much they bought. Now, systems offer interactive capabilities between the c-store and the forecourt, recognize customers and offer promotions. Managers can also review business data remotely through integrated POS and control software.

New dispensers also make unattended fuel site development more attractive. The development of autonomous vehicles will be another huge game-changer. Need your car washed before work? With fully autonomous cars and trucks, owners will be able to command them to leave the driveway during the early morning to go to the neighbourhood 24-hour car wash for a rinse and shine and then return home ready for the day. Mechanics will be able to monitor vehicle performance remotely. If they find a problem, technicians will be able to ask the car to present itself to the repair facility and then return home to the driveway when it is fixed. Connected cars are already here. However, software and interface systems are lagging in North American markets. The technology to interact with fuel dispensers and receive beacon marketing messages is already on board Jaguar, Land Rover, Honda and other brands. In locations such as the UK and South Africa, cars can pull up to gas dispensers, have fuel pumped with the car’s digital tools making payment. Messages about on-site promos are sent from the dispenser to in-car display screens. Coke is on special. Want a cold six-pack? Just ask the forecourt attendant to bring it over. The car makes the payment. New tech is opening up a host of opportunities for enhanced service. How will you pivot to take advantage?

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Brushes with greatness Car wash brushes show their softer side with new tech

TIPS

By Kelly Gray

Use a low-pressure hose to rinse wash site floor surfaces to ensure sand and grit goes down the drain where it belongs and doesn’t end up on brushes. Adjust brushes to ensure precise and careful positioning for the types of vehicles going through the wash. Operate brushes at the correct RPMs and with the proper force. Wash brushes every night with a high-pressure hose. Examine brushes daily for signs of wear.

No matter how much change there is in the car wash business, some key aspects remain the same. To get a great car wash you still need three things —good quality water, detergent and friction to get the job done right. Today, some prefer to go the touchless route where water jets do the heavy lifting, but, for the majority of wash sites, friction from brushes is what creates the clean. In the early days of the Canadian car wash trade, operators used bristle brushes to grab grime and lift it off vehicle surfaces. There were complaints. Customers suspected the tough bristles were scratching the paint. Belanger came to the rescue with soft cloth technology that sought to change some of the touchpoints, making them more paint-friendly. Today, brush technology has moved from hard plastic nylon brushes to brushes constructed of soft strips of cloth and closed-cell foam media. These advance-

MAY/JUNE 2021

ments better protect vehicles from damage while delivering a heightened level of clean. It comes down to getting control of the basics, suggests Paul Facciol, VP Shine Auto Wash and Storguard Self Storage. “We did our homework upfront and have been able to fine-tune as we’ve moved forward,” he says, adding that their experience has allowed them to make many adjustments to the wash process that have helped them become one of North America’s volume leaders with through-put around 2,500 cars on a busy day. Shine uses NEOGLIDE technology to maximize wash results. According to Facciol, they read a report on the technology from Mercedes and were sold on the system. “Mercedes showed us that hand washing actually grinds grit into the paint surface while NEOGLIDE flings grit and dirt away from the car during its 360-degree rinsed brush rotation.” NEOGLIDE inhibits water absorption and resists grit and dirt becoming

embedded into the brush material. The result is extremely gentle on current model soft clearcoat vehicles. According to Bernard Aoun, equipment division sales director — Entretien de Lave Auto Laval (ELAL), they have noticed that car washes with brush wash technology are making a comeback in the Quebec market over the last few years. “The advantages are numerous,” he says. “This technology offers more consistent quality and a faster wash than a touchless car wash. The brush technology has been greatly improved over the last few years. Most manufacturers now use variable speed frequencies (VFD) to allow an optimal adjustment of the brushes. There is also the material used which polishes vehicles at the same time it washes while being 100% waterproof which prevents car dirt from remaining on the brushes. “To obtain an optimal result, we always recommend that our customers provide a high-pressure pre-rinse arch at the start of the CCentral.ca

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wash cycle to dislodge the dirt that the brushes cannot reach. Also, it’s important to use high-quality chemicals to ensure that the brushes are always well lubricated. This lubrication will prevent the brushes from gripping vehicle antennas or mirrors and will ensure an optimal wash quality at all times.”

The right brush for the job Twenty years ago, rocker brushes used to be 18-inches tall. Changes in car and truck body designs now mean these brushes must be much taller to reach popular SUV and heavy-duty truck designs. Wrap-around brushes have the same issue. With larger vehicles, wrap-around brushes may not fully unfold, extend or fit the shape of some vehicles as well as they should. This poor fit can provide a lack of necessary pressure on rear surfaces to remove road dirt. One advancement that is helping to fix this challenge is Sonny’s new Dual CounterWeight Top Brush (DCW). The DCW starts close to the ground to wash the front bumper and grille, move along the windshield, and go up to the center of the roofline before reversing the direction of the brush rotation to hug the rear of vehicles. This flexibility greatly improves the cleaning of hard-to-reach rear windows and tailgates on both trucks and SUVs. Over recent years, synthetic brushes made of nylon and polypropylene have been the standard in most tunnel wash locations. These synthetic types of brushes that feature shorter filaments with fewer bristles on brush heads are stiffer and better suited for heavy scrubbings on tires and filthy older model cars. Softer materials such as cloth or foam are gentler on paint, trim and other surfaces. Plush brush materials are another softer touch method for overall vehicle cleaning. These can range from 1/4-inch to 1-inch thickness with longer tufts reaching deeper into crevices and providing more overall surface area for cleaning. Use hog’s hair brushes for prep work or final touch-up at tunnel washes on headlights, licence plates and door handles. Hog’s hair brushes are tapered and feathered and work well with lubricants to deliver the softest, most effective option when used for foaming brushes in self-serve car wash operations. OCTANE CCentral.ca

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Digital transformation for the fueling industry

THE WAY YOU MANAGE YOUR FORECOURT IS CHANGING Introducing the DFS DX™ connected solutions platform, which delivers solutions spanning wetstock management, remote asset management, targeted advertising and media at the dispenser, fleet fueling site management and point-of-sale management. Find out what the future holds for your fuel business at doverfuelingsolutions.com/dfsdx.

© 2021 Dover Fueling Solutions. All rights reserved. DOVER, the DOVER D Design, DOVER FUELING SOLUTIONS, and other trademarks referenced herein are trademarks of Delaware Capital Formation, Inc./Dover Corporation, Dover Fueling Solutions UK Ltd. and their affiliated entities, registered or claimed in the United States and various other countries. 31-MAR-21

Pumping innovation Today’s fuel dispenser is as much about getting gas into your car as it is about reaching motorists with targeted marketing messages. Current technology now allows fuel dispensers to interact with motorists and fuel site management. Dover Fueling Solutions (DFS) is just readying the DFS Anthem UX™ user experience platform for Wayne Ovation® fuel dispensers, with product roll-out expected in Canada for 2021. With this new solution, the dispenser features a 27” colour touch display, biometrics option, loyalty abilities, iP address to talk with new cars, as well as a Microsoft Azure cloud-based platform. Using Windows 10 IoT Enterprise, Azure IoT Hub, and Stream Analytics, DFS’ new Anthem system delivers personalized experiCCentral.ca

ences with content and targeted advertising right at the pump. Anthem also increases efficiency in pump and tank monitoring, allowing operators to fix small issues before they become costly repair problems. And, it talks to new cars and takes payment for gas purchases via Apple Pay and other digital wallet tools. With Anthem, returning customers are recognized and can be offered products for which they have indicated a past preference, purchase a wash or receive marketing and loyalty messages that drive in-store business. Operators can access the data remotely, and they can utilize analytic tools to help increase profits and site efficiency. Dover Fueling Solutions, which comprises Wayne Fueling Systems and other legacy brands, collaborated with Federated Co-operatives Ltd. to develop the program

New fuel dispensers deliver more than gas By Kelly Gray

and worked with Mosaic (Digital Mosaic Corp.) to create an app that allows for push marketing notifications. Here Co-op locations can offer 50% off Tuesday washes or a deep discount on a wash right after a rain. These messages appear on phones. “We have just installed the new Wayne Anthem that feature a huge media screen that is great for promotions that get people into the c-store,” says Randy Andrusiak, gas bar operations manager, Red River Cooperative Ltd. "We think there will be an opportunity to create total connectivity between marketing platforms,” he says, mentioning that the push notifications on phones will mirror specials highlighted on the dispenser media screen as well as on displays in-store. Dover Fueling Solutions has also just rolled out its DX Promote platform to support the MAY/JUNE 2021

The DX Promote user experience has been designed to streamline operations by creating a simple process to upload and change the promotional and media content customers see at varying stages of the fuelling process.

With Anthem, returning customers are recognized and can be offered products for which they have indicated a past preference, purchase a wash or receive marketing and loyalty messages that drive in-store business

Wayne Ovation and Wayne Helix fuel dispensers. DX Promote was introduced last year with the DFS Anthem UX user experience platform. DX Promote allows retailers to advertise their goods and services through an integrated digital experience at each fuelling point. This messaging helps drive customers inside the convenience store to increase retailer sales and profit margins. Driven by Microsoft Azure, DX Promote leverages next-generation technology to centrally manage and deploy day and time-appropriate advertisements. It also offers the capability to boost in-store sales, on-site car washes and other services. Ultimately, DX Promote increases overall average per-visit revenue and profit. “The DX Promote user experience has been designed to streamline operations by creating a simple process to upload and change the promotional and media content customers see at varying stages of the fuelling process,” says Reggie O'Donoghue, senior director of product management at Dover Fueling Solutions. Gilbarco Veeder-Root suggests that better inside sales start outside under the canopy. Toward this end, the company launched Encore Experience, a cloud-based open applications platform that enables retailers to customize on-screen experiences at the forecourt and drive customers inside a site’s convenience store. With Encore Experience, retailers can create their own apps or use Gilbarco-built or third-party-developed apps to remotely and securely deploy content and functionality to their Encore® dispensers screens.

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Fueling the Future

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Encore Experience is Gilbarco’s first open application system that is fully interactive. While customers fuel vehicles, they can view live news as well as in-store promotions. The dispenser is designed to increase loyalty with apps that direct customers into the c-store. “Encore Experience greatly enhances a guest’s speed of access to a store’s range of products and services. The concept seeks to remove every barrier to in-store sales where the profits are,” says Steve Liguori, Gilbarco’s marketing manager for Encore Experience. Operators can have multiple apps running and can customize dispenser messaging for all locations or just one dispenser. Dispensers can also print out in-store coupons and alert gas customers to promos and store events. And, perhaps most important is that Encore Experience takes payment at the pump for embedded promotions. Bennet Pump has been making fuelling devices for more than a century and many Canadian operations utilize the company’s new NV line of dispensers. These products offer an enhanced operating economy with the company suggesting energy costs are 60% lower than other dispensers. It also offers one of the best fuel meters in the business, something operators like because accuracy puts money in their pockets. The systems also come with a range of media displays that range from 7-inches to 10.5-inches.

Sell the Sizzzle.

Alternative energy solutions B.C.’s Powertech Labs has just released its latest hydrogen dispenser. Powertech Labs is wholly-owned by BC Hydro and has installed hydrogen fuelling equipment at four retail sites in the province, one in Quebec and another in California. The new-look dispenser offers an easy-to-use customer interface and provides T40 700 bar and 350 bar fuelling capability. It comes with a full POS for credit and debit transactions and can be configured for fleet use. Customers can fill a passenger car between three and five minutes. The company reports that this design simplifies installation and mirrors other dispensers with single or double-sided use as well as single and double nozzle options available. The equipment is also easily installed at existing gas stations right next to diesel and gasoline dispensers. Charge Point is offering a solution for operators that want to offer EV charging. Charge Point’s CT4000 charging station dispenses electricity to customers with new electric-powered vehicles. The system features flexible pricing options where charging fees can be set by time or session. Usage can run through Charge Point’s mobile app where a waitlist can put users in a lineup at busy sites. The app reserves a spot and alerts the driver when a place is available. Gilbarco Veeder-Root has introduced their new RT50 50kW DC Fast Charger to add to their existing line of EV chargers. Simple and quick to install, the RT50 offers a small footprint and can be placed almost anywhere on the apron. It also speaks your language with an intuitive interface designed for easy use. OCTANE CCentral.ca

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ALL IN THE FAMILY Quebec’s Milot family look to the basics to steady business during the pandemic By Mark Cardwell Photos Chantale Lecours

MAY/JUNE 2021

L-R: Maxime, Denis, Chantale and Marco

The COVID-19 pandemic, resulting lockdowns and decrease in travel have hit many Canadian gas and car wash retailers hard, especially those in major urban centres. But for one Quebec family with a group of six Petro-Canada gas stations, car washes and c-stores in a rural region that is still under maximum COVID-19 alert, the global health crisis has produced a big bump in their bottom line.

CCentral.ca

High and wide - forecourt at Milot’s Petro Canada in Saint-Jacques, QC. Lots of room for trucks, RV’s and others.

“Of course, the pandemic has been very challenging and created a lot of stress and anxiety for everyone everywhere,” says Maxime Milot. “But business-wise, things have been very good for us over the past year.” Maxime and his two younger brothers—Mathieu and Marco—each own and operate two multi-service outlets in Quebec’s Lanaudière region, an area that stretches north from the eastern end of the Island of Montreal to the Laurentian Mountains. Like Montreal and neighbouring regions Laurentian and Montérégie, Lanaudière remains one of the last red zones on Quebec’s colour-coded C-19 alert map, with nightly curfews and other restrictions still in force as of late March. The Milot brothers’ six businesses operate from leased premises in communities within a half-hour drive of one another in the southern plains and foothills of the Lanaudière region. All offer similar goods and services. Each site has eight pumps that sell gas and diesel under the Petro-Canada banner. “We don’t have EV charging—at least not yet,” says Maxime Milot. “The equipment is too expensive for the demand, which still isn’t strong enough to justify the investment.” The sites also have Beau-soir c-stores that sell everything from cigarettes, beer and wine, to snacks, grocery items and lottery tickets. They also sell ready-to-eat items like croissants, baguettes and muffins, which are made fresh daily at the group’s flagship store in St-Jacques. “We do lots of wash promotions at our stores to take advantage of the fact people stop in to buy gas and to get cigarettes, beer or milk,” he says. CCentral.ca

"OF COURSE, THE PANDEMIC HAS BEEN VERY CHALLENGING AND CREATED A LOT OF STRESS AND ANXIETY FOR EVERYONE EVERYWHERE,” SAYS MAXIME MILOT. “BUT BUSINESS-WISE, THINGS HAVE BEEN VERY GOOD FOR US OVER THE PAST YEAR"

ASK US HOW TO GROW YOUR PROFITS

AUTOMATIC REVENUES www.decastel.com • Tel.: 1 800 531-5492 11 650 J.J. Joubert, Montreal, QC H1E 7E7

YOUR WASH SOLUTION SPECIALISTS

In addition to a standing $2 discount on the $9.99 base price of a car wash with a minimum $20 gas purchase at all six locations, the Milots offer a variety of specials that alternate and vary between their stores. They include a free basic wash with the purchase of two premium washes, or a free wash after six paid washes with a stamped loyalty card. “Wash promotions are one of our best sellers,” says Maxime. Other popular promotions include the PetroPoints program and weekly specials on c-store items like beer, energy drinks and chocolate bars.

Touchless sites are leased All six Milot locations have car washes equipped with touchless units. Quebec’s two leading vehicle cleaning systems and equipment specialists—De Castel and Entretien de Lave-Auto Laval (ELAL)—each supplied three of the units. The De Castel supplied units are PDQ Laser Wash 360-Plus systems, which provide a best-in-class, subthree-minute base wash. De Castel is the sole distributor in Quebec of Wisconsin-based PDQ Manufacturing’s equipment and parts. NCS Half Page Octane Ad 04.08.2021_crops.pdf 1 4/8/2021 10:52:21 AM

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The ELAL supplied units, which include the two most recent additions to the Milot family stations in 2019, are Ryko Radius machines. ELAL is also the only distributor in Quebec for the parts and products made by American car wash equipment maker Ryko. All six of the car wash units operated by the Milots were purchased and are owned by independent real estate developers who built the sites where the brothers’ businesses are located. As part of their rental leasing agreements, the Milots pay a percentage of car wash sales to site owners and pay all wash-related operating costs like maintenance, repairs, soaps and waxes. “That’s a very common arrangement in Quebec,” says Jean-François Hamelin, accounts manager for De Castel. “Many independent car wash operators here do not own the equipment they use.” Bernard Aoun, equipment division sales director at Entretien de Lave-Auto Laval, says that while ELAL sells 98% of their car wash equipment, third-party car wash leasing agreements can work well for both renters and operators. “Both the parties, those that lease and those that operate the equipment, have a vested interest in making sure their units get the annual, monthly and even weekly maintenance they require to run properly,” he says. “We see very few car wash operators doing lease equipment deals. We make sure all our clients get the service and maintenance needed once they purchase the equipment. One of the services we offer our clients is monthly visits to verify their chemical levels, inspect the injectors and an overall check on their equipment.”

Pandemic sales remained strong The pandemic has not adversely affected car wash sales at the family’s businesses. All six sites have enjoyed increased sales, a boost Maxime credits to several pandemic-relate factors. A major one has been the dramatic increase in the number of people who have been working remotely from home or secondary residences in places like the Lanaudière region. “Many people from Montreal have cottages here,” says Maxime. “Normally, we only see them on the weekends. But now they’re here all the time.” “Going to the store, getting gas and getting your car washed is one of the few things people can do,” says Maxime, mentioning the lockdown. His family’s businesses, he noted, are deemed essential services and have remained open throughout the pandemic. And, despite ongoing employee retention challenges, he says all six sites have continued to operate 24/7. According to Maxime, the pandemic has also altered how, when and where people shop, and the things they buy. More customers are also taking advantage of gas purchase-related discounts to get their cars washed during the pandemic. CCentral.ca

“We’re doing more washes on the weekends because more people are coming to their cottages or coming to do outdoor activities in our region,” says Maxime. “But we’re also selling a lot more washes during the week because more people are living here now and working from home.”

Making room for family The Milot’s parents, Denis and Chantale, started the family business in the early 1980s when they bought a c-store with a Sonic gas station (later converted to Shell, then to Petro-Canada). In 2014, they bought a second gas station (a Petro Canada) with a De Castel-equipped car wash 50 km. away in St-Jean-de-Mantha, the hometown of legendary Canadian

strongman Louis Cyr. By then, Maxime, who played baseball in the U.S. on scholarships, had returned home and joined the family business. He was joined by Mathieu a year later when the family bought a third store in L’Épiphanie. The Milots later bought their fourth store in Ste-Anne-des-Plaines (Ryko Radius equipment) for Marco. They then added stores in St-Jacques-deMontcalm (Ryko Radius equipment) and St-Roch-de-l’Achigan. In 2018, Denis and Chantale sold all six sites to their sons — two each. Chantale continues to do the accounting and Denis is his sons’ man Friday. “Having two stores allows each of us to earn a good living and to help and support each other,” says Maxime. “It’s a true family business.” OCTANE

NO STAFF, NO PROBLEM Unattended fuel locations are safe, convenient and offer a competitive edge By Kelly Gray

Unattended fuelling sites dot the country. These are locations that are open 24/7 and offer no staff with point-of-sale interface systems handling transactions. Customers are typically fleet operators or truckers, who look to cardlock outlets for their convenience and design that provide more room for large transport vehicles. However, in areas such as rural communities and remote locations in the North, these ‘ghost sites’ or ‘UFOs’ (unattended fuelling operations) are open to the average motorist. Most of us are well acquainted with self-service options at gas bars. These self-service locations operate under the regulation of the National Fire Code of Canada. The code stipulates staffing and monitoring for gas stations. Jurisdictions such as Ontario and Alberta, NunCCentral.ca

avut and NWT, as well as Yukon and Quebec have written their unique regulations to allow for unattended operations at sites where the general public can access the service. Europe, the most developed market for unattended gas stations, is an example of how this business model can work. It is common to find gas bars from Italy to Ireland where sites are remotely monitored rather than staffed. CoucheTard, a company with more than 14,000 c-stores and fuel sites globally, operates hundreds of ‘ghost sites’. Refiner marketers, such as Shell and BP, have a vast number of unattended sites throughout the EU. How do these remotely monitored retail sites work here in Canada? “Sites are equipped with two-way communication systems with continuous video monitoring capabilities,” says Don Jonasson, senior engineer and principal with CTM Design, a Calgary-based MAY/JUNE 2021

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Instead of an onsite attendant, the station is supervised by an employee or owner that may be working at home, at an office or even at another service station. Third-party monitoring services may also be utilized.

full-service, design, engineering and architecture firm that has been working for years with the fuel industry on unattended site builds. “Unattended fuelling sites address the serious staffing challenges that currently hampers the retail sector,” he says, stating that basic unattended retail site developments (those that don’t cater solely to transport trucks) may take up smaller footprints than a typical gas bar because there is no need for a standard kiosk. “Instead of an onsite attendant, the station is supervised by an employee or owner that may be working at home, at an office or even at another service station. Third-party monitoring services may also be utilized,” he says. According to Jonasson, customers prepay using a credit or debit card. “The pump is then activated by the remote attendant. Should the customer have a problem, he or she can communicate using the two-way monitoring system. To

protect against fire and other concerns additional safety systems are in place.” Jonasson points to three principal reasons for operators to consider a ‘ghost site’. First is asset optimization, where operators can extend their hours of operation. The second reason is savings in staffing costs. The third example is employee safety. With remote monitoring, concerns about employee wellbeing during evening hours and in remote locations are removed. According to Jonasson, the challenges to create an unattended site are not onerous. “Most of the wiring and conduits are built into the canopy. And, for the most part, the code is similar to a standard setup, with a few added requirements.” These requirements include two-way communication systems with real-time video surveillance (high-speed internet connection required); remote monitoring equipment at

an offsite location; standard dispensers with an emergency stop, and optional equipment that may include an intrusion alarm and/or an automated fire suppression system. As well, sites should include additional safety signage (including information on emergency contact numbers) and direct communication from the pump to the local fire department (Alberta). Cornerstone Co-op is a good case in point of how unattended sites can work with community needs. The locally-owned Co-op operates six cardlock sites in central Alberta, from Provost to St. Paul. Any co-op member can apply for cardlock access and then use the card to fuel everything from farm trucks to the family’s Dodge Caravan. “With a Co-op cardlock account you can use any cardlock facility across Western Canada,” says Dwayne Odgaard, Cornerstone Co-op Petroleum Manager. He mentions that their gas bars in Wainwright and St. Paul offer

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attended service until 10 p.m. “Once the location closes for the night, members can still access fuel with their cardlock PINs. This service gives customers more options. They don’t have to work around our schedule,” he says, noting that they have maintained their market share in the area despite the challenges of COVID-19 and reduced gas sales. Odgaard reports that sites still require regular maintenance to keep the locations running smoothly. Maintenance occurs on a regular schedule. Crews check on dispensers, look for signs of fuel leaks or spills and address any concerns about lighting or snow on the apron.

AN INNOVATIVE AND ECO-FRIENDLY SOLUTION FOR REFILLING WINDSHIELD WASHER FLUID

Equipment interfaces easily Equipment at retail unattended sites mirrors those of commercial cardlock locations. Fuel hoses are typically longer to support highway transport trucks and RV’s larger sizes, and fuels flow much faster than customers find at standard gas bars, with dispenser gun nozzles slightly larger to accommodate the increased volume. Customers also find that while they are used to pay-at-pump technology at self-service stations, retail cardlocks tend to have payment terminals that oversee multiple dispensers. Fuel Commander software system is one of the most common control systems in use in unattended sites. “The software is very similar to Pay-at-Pump systems,” says Lee Barter, SVP, sales and marketing with InfoNet Technology, the company behind the software that runs the system. He reports that their Outdoor Payment Terminal (OPT) software can work with the full range of dispenser manufacturers. Retail fuel customers provide their cardlock PIN and payment card (for commercial accounts Fuel Commander generates invoicing). Fuel Commander activates the pump unit. When customers finish, they shut off the pump and close the sale before leaving the site. Fuel Commander features remote management capability, and alongside video monitoring, it can take control of the location if a problem occurs. It also offers on-screen messaging that can highlight safety procedures or even promotions. Burnaby, B.C.-based Computrol offers Simcom, a new system that manages fuel and liquids dispensing and reporting with web-based software. Operators can manage one location or several sites from anywhere via the Internet and mobile devices. Benefits include real-time transaction records, and users can instantly see their inventory levels, terminal status and other dispensing operations data. Simcom is hosted securely in the Cloud in Canada and operates with their new terminal, as well as with existing C6000 terminals. OPW offers Dispenser Terminal Control (DTC), a system that, when interfaced with their FSC3000 Fuel Site Controller, enables a convenient, retail-like fuelling experience for end-users, while providing the fuel control capabilities that cardlock sites need. The package delivers an all-inone system that combines the convenience of a Gilbarco CRIND® or Wayne CAT-equipped retail fuel dispenser with the automated fuel-control functions of a commercial fuel site controller. DTC tracks and reports on fuelling transactions by driver and vehicle. OCTANE CCentral.ca

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Training pays

Staff training helps generate profits and creates customer satisfaction By Kelly Gray “You just can’t operate without training,” says Harsha Nimrani. Nimrani is a Southern Ontario businesswoman who owns and operates six gas station/car wash sites in the Niagara region. She reports that she and her staff have turned to Sonny’s Car Wash College for their expertise. “Training must be ongoing and convenient. With this program, all we need is access to a computer and a quiet room.” Sonny’s offers onsite and online training programs targeted to both management and staff. According to Bob Fox, Sonny’s VP Car Wash College and Technical Support, they run investor seminars and management programs from their Phoenix location. “The Investor Program is a one-day offering. This year we reduced the size from 24 seats to 16. We have a waiting list of around 32 persons,” says Fox. “We also offer a series for managers that comes with three core areas-Management 101 for entry-level managers that covers everything for P&Ls to dealing with chemistry vendors; Maintenance; and Repair where we have four technicians offering hands-on training in 14 labs.” Four courses are online (Maintenance, Repair, Management, and Introduction to Car Wash). These courses benefit both managers, as well as staff. Fox reports that Introduction to Car Wash is the best bet for general staff. This program delivers a concise information package that provides a solid introduction to conveyorized car washing. Sections include Best Safety Practices, Paystation Walk-Through, Tunnel Walk-Through, Loading Cars, Vac Area Walk-Through, and Chemistry 101. “I’ve been washing cars for over 30 years. When I started there were no training programs. You learned as you went along.

MAY/JUNE 2021

When a system failed, staff had to learn how to fix it and how to prevent this problem from happening again. When there are problems at a car wash it usually means downtime. Downtime can be expensive,” he says, noting that the $50 to $80 spent on online training modules is a well-considered business expense. NCS (National Carwash Solutions) College of Clean offers a unique CleanTouch Chemical management course that features real-world, hands-on class instruction to teach operators to successfully manage the chemical portion of their car wash business. NCS reports that course material includes a ‘how-to’ on the use of chemical portioning devices, formulation, and dispensing to optimize your chemical combinations for maximum efficiency and minimal costs. Participants also get a grounding in safe handling and general use in car wash. Cost analysis, inventory management, and application systems are also covered, and instructors discuss troubleshooting tips to keep chemical-use safe and cost-effective. Classes are run by industry professionals at NCS’ 10,000-sq.-ft. Customer Experience Centre in Grimes, Iowa. At this location, NCS offers six fully equipped instruction bays and a wet lab for chemical training. Equipment distributors such as Quebec’s Entretien De Lave Auto Laval (ELAL) take chemical use seriously. ELAL offers Mondo products to its car wash customers. “We offer training specific to each client in proper chemical use and follow through with visits to their site,” says Bernard Aoun, ELAL, sales director—equipment division. He reports that they offer a full-service chemical department that is available for consultation. “We visit our customers once or twice a month to make sure they have the right combinations for

5 tips for training excellence:

Train the trainer: Pick key staffers for a fuller training program and then allow them to indoctrinate new workers with best practices.

Incent good performance following training to reward staff for using what they learned.

3 4 5

Refresh training on a continuing basis.

Give workers both the time and the place to study.

Look to larger organizations, such as the CCA, for advice on how to get involved with a good program.

their sites. We test the injectors, chemical levels, as well as the overall quality of wash and, can advise on the effectiveness of the wash chemistry. Chemicals for touchless systems are more concentrated with a higher PH level than those in use in tunnel washes where friction does a lot of the work. Operators need to know the best mixes and how to use their chemicals in an efficient cost-effective manner,” he says echoing Nimrani’s earlier comments that good training delivers results. OCTANE CCentral.ca

Suppliers, what’s new in your product line? Contact Elijah Hoffman at 647.558.0103 or ehoffman@ensembleiq.com

Product News BLENDCO SYSTEMS - CERAMIC PROTECTANT Blendco Systems is proud to introduce our NEW line of Ceramic Protectants! These products are specially formulated with a proprietary polymeric silica base, which forms a ceramic glass-like barrier, bonding fully with glass, chrome, rubber, plastic, and paint. These products come with the Rust-Oleum® name synonymous with high quality and trust, which will outlast all others! This fantastic line of innovative products includes our Ceramic Total Body Protectant, Clearcoat Protectant, and Foaming Protectant. Combining these products can help you to produce the driest and shiniest cars possible. 800.446.2091 | www.blendco.com

McCowan Design & Manufacturing is pleased to introduce the MU-803 MULTISTREAM WASTE RECYCLE STATION. The MU-803 is an innovative solution to help make your forecourt more environmentally friendly! Manufactured from 100% recycled HDPE material and stainless steel, the MU-803 is built to last in the Canadian climate! Complete with three large capacity 135L liners, vibrant labels, flip lids and graphic doors, McCowan has the recycling solution you’ve been looking for. 416.291.7111 | www.mccowan.ca

PRODUCTS, EQUIPMENT AND SERVICES

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Broadcast dynamic promotions that will grab customers’ attention at the pump or passersby and increase in-store traffic. Easily create and schedule promotion playlists according to the time of the day to increase your revenues. Your content will be visible day and night with this turnkey, affordable and easy-to-install solution. Watch it in action at: www.nummax.com/ledposter Contact us for more information Toll-free: 1-877-255-3471, ext.: 207 info@nummax.com

ECOTANK - THE INNOVATIVE AND ECO-FRIENDLY WINDSHIELD WASHER FLUID DISPENSING SYSTEM EcoTank is a unique, patented solution for refilling windshield washer fluid. By eliminating plastic packaging - EcoTank makes a significant environmental impact! Its modern design, simple installation and easy operation means it's quickly becoming the worldwide standard for gas stations. This ecological solution is suitable for all gas stations, car washes and EV charging locations. EcoTank works on the gravity principle and requires only 24V to operate making installation very quick and easy! EcoTank Canada 226.916.5363 | www.ecotankcanada.com

CANADIAN CANADIAN

CARWASH CARWASH ASSOCIATION ASSOCIATION CCA SUPPLIER HIGHLIGHT

DIRECTORS Christopher Armena – Morgan Arnelien – Jeff Beam –

MARK VII

FEDERATED CO-OPERATIVES LIMITED MONDO PRODUCTS CO LTD

Mitchell Easton –

MAY/JUNE 2021

PETRO-CANADA

Suppliers to the carwash industry are a significant part of the CCA member base. The relationship between the carwash industry, suppliers and oil companies are closely connected and the CCA actively promotes communication and cooperation between these groups. These valuable relationships have impact and influence on the industry’s business and legislative environments.

Michael Howe – BAYWATCH ENTERPRISES CANADA DIVISION

Mike Jacques – WASHTECH VEHICLE WASH SYSTEMS Jason Kaye –

BAYVIEW CAR WASH LTD.

Jamie Shaw –

7-ELEVEN CANADA, INC.

Karen Smith –

Our suppliers are encouraged to take advantage of connecting with operators. This allows them to learn what their needs are and how they can better serve them. Suppliers are given opportunities to get in front of our members through hosting webinars, presenting educational sessions and sponsoring CCA in a number of ways.

VALET CAR WASH

Tim Walker –

REVINMEDIA

Rudy van Woerkom – BIG CITY AUTO N TRUCK WASH

NATIONAL OFFICE Director of Operations Elizabeth McCaw Accountant Ricky Nason Event Coordinator Danielle Levitt

Canadian Carwash Association Please note our new address: 411 Richmond Street East, Suite 200 Toronto, Ontario M5A3S5

COVID-19

RESOURCES Members have access to a library of resources through the CCA and CFIB partnership. Visit https://www.canadiancarwash. ca/COVID-19-and-the-Industry for more information.

Suppliers to the carwash industry join the CCA as Associate Members. For information on CCA’s Sponsorship and Associate Memberships visit www.canadiancarwash.ca/Supplier-to-the-Industry

INDUSTRY FORUM INDUSTRY FORUM DEDICATED TO SHARING KNOWLEDGE AND BEST PRACTICES IN THE CARWASH INDUSTRY

JOIN CANADA’S ONLY ASSOCIATION DEDICATED TO THE CANADIAN CARWASH INDUSTRY! The Canadian Carwash Association is dedicated to sharing knowledge and best practices, as well as to promoting the benefits of professional car washing in Canada. By joining CCA, you join a group of passionate and committed people who: • • • • •

Participate in the bi-annual CARWACS tradeshow Learn through attending and delivering education events Volunteer to run social events for our members Advocate for high standards in car washing Help one another make better business decisions

SOME OF THE FEATURES AND BENEFITS THAT YOUR CCA MEMBERSHIP PROVIDES YOU ARE: News The CCA Communique, our bi-weekly newsletter, offers CCA updates, as well as timely industry-specific news. Information on How to Get Started in the Industry The CCA Starter Carwash Toolkit provides key information for business owners and prospective business owners looking to get started in the industry. Business Resources and Professional Guidance A joint-membership with the Canadian Federation of Independent Business (CFIB) brings a host of benefits including: access to free business counsellors, free courses, deep discounts to various services like reduced credit card processing rates and much more. Market Research The opportunity to participate in the Wash Volume Report Program with access to current market data for carwashes across Canada. This detailed report is free for those who participate in the program. There is no additional cost to join.

Member Insurance for Carwash Professionals A Carwash Insurance Program with CCA supporter and partner Erb &Erb, that is specifically built for Carwash Owners; one that advocates on your behalf and knows the needs and challenges of your business. Education Online education covering compliance, shipping, insurance and other relevant topics to Carwash Owners. The biannual CARWACS tradeshow, a networking and professional development opportunity, that brings together industry professionals and shares current industry best practices. Competitive Member Rates and Discounts From credit card processing to shipping, to accounting services and more, our partnerships have leveraged some of the biggest discounts. Many of the discounts you are entitled to are part of your CFIB membership, which comes free of charge with your CCA membership.

High Standards Access to the WaterSavers Alliance Program

at a discounted rate, demonstrating your company’s commitment to water conservation and quality. An annual sticker to show that you are a member of the CCA and the CFIB. Show your customers that you are part of organizations that support ethical business practices. Connection with other CCA Members When you join CCA, you have access to the online member directory, which is made up of operators and suppliers to the industry. You can connect in person at events through our conference and social events Local small events allow you to network and share best practices in an informal learning setting Visibility A listing on the supplier page (for supplier members); the most visited page on the CCA website. A spot in our online carwash directory/ The opportunity to host webinars or become a CCA sponsor.

CANADIAN CARWASH ASSOCIATION CANADIAN CARWASH ASSOCIATION

SPECIAL REPORT:

RIDING THE WAVE OF GENTRIFICATION Kenny Shim’s Busy Bee King Mart is constantly evolving to meet the needs of its Toronto neighbourhood

SUSTAINABILITY SHIFTS INTO HIGH GEAR

DIGITAL SIGNAGE 101 INSIGHTS FROM MCGILL’S RETAIL INNOVATION LAB TURN UP THE HEAT ON SALES OF FROZEN TREATS

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PLUS 5 STRATEGIES TO ATTRACT, RETAIN AND MOTIVATE EMPLOYEES

PROUD SUPPORTERS *NO PURCHASE NECESSARY. Open to legal residents of Canada, age of majority+. Contest opens June 1, 2021 at 12:00AM ET and ends August 8, 2021 at 11:59PM ET. To enter, scan QR code on specially marked packs of RITZ Original 200 g, CHIPS AHOY! Original 460 g, OREO Original 500 g, or PEEK FREANS 300 g, or visit TasteGlory.ca and complete entry form to enter. Standard message & data rates apply if entering via mobile device. Eight (8) Grand Prizes available to be won. Grand prize packs include: a live video chat with a Canadian Olympic athlete, a tablet, Team Canada merchandise, Mondelēz Canada branded items and assorted Mondelēz Canada products (ARV $1,600 CAD). Plus, a chance to instantly win one of two hundred (200) Secondary Prizes. Secondary prize packs include: Team Canada merchandise, Mondelēz Canada branded items and assorted Mondelēz Canada products (ARV $125 CAD). Random Grand Prize draw on August 9, 2021 at 1:00PM ET in Toronto, ON. Correct answer to math skill-test required. Odds of winning Grand Prize depend on number of eligible entries received during the Contest Period. Odds of winning an instant prize depend on number and timing of eligible entries received during the Contest Period. Limits apply. For all conditions, restrictions and complete contest rules, visit TasteGlory.ca.

PPD CAD EVDY FMLY VAR FLR 96CT OL Contents: 36 CADBURY DAIRY MILK 100g 61200225910 36 CADBURY Fruit & Nut 100g 6120022592021 24 CADBURY Hazelnut 100g 612002259338

Contact your wholesale representative or your Mondelez Canada representative for more information.

MAY/ JUNE 2021

Volume 4 | Number 3

CONTENTS

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Editor’s Message Change is in the air

The Buzz People, places, news and events

Quick Bites Cold comfort: Consumers seek security in frozen foods

Category Check Frozen treats poised for a sizzling summer

Top Ops Digital signage 101: Best practices

Feature Hand in hand: Distribution partners play a crucial role in the success of c-stores

Retailer Spotlight Toronto's Busy Bee King Mart evolves to meet the needs of its neighbourhood

Tech Talk The co-directors of McGill University’s Retail Innovation Lab share insights into the future of convenience stores

Feature Sustainability shifts into high gear: The move to sustainable packaging and products

Ask the Expert Lisa Hutcheson outlines 5 strategies to attract, retain and motivate employees

Voices Convenience and COVID-19: C-store operators share stories from the front lines

Snapshot Kathy Perrotta of Ipsos Canada: Gen Z's priorities and what they mean for c-stores

Backtalk Teachable moments: Ryerson University’s Janice Rudkowski on category management and the evolution of convenience

Convenience news & insights DELIVERED TO YOUR IN-BOX EVERY WEEK. The latest industry news and information, plus resources, foodservice insights, store solutions, tobacco/vaping updates and more. Don’t miss our e-newsletter! Sign up today at www.CCentral.ca/signup

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MAY/JUNE 2021

EDITOR’S MESSAGE

CHIEF INNOVATION OFFICER | Tanner Van Dusen CHIEF HUMAN RESOURCES OFFICER | Ann Jadown EXECUTIVE VICE PRESIDENT, EVENTS & CONFERENCES Ed Several

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CHANNEL ALLIANCES:

Change is in the air Spring is always a time of rejuvenation, hope and transformation. This year it’s been a bit of a mixed bag. With vaccines rolling out, we’re all hopeful, however variants and rolling lockdowns in regions across the country present ongoing challenges for everyone, our industry included. We want you to know that the CSNC team is here for you, that we are listening to your ideas and responding by delivering the latest news and insights to help you stay safe, informed and connected. Rejuvenation: Part of this effort includes an exciting new website designed to be a valuable resource and community hub for those in the convenience, gas, car wash and related industries. In addition to news and information, the site features Expert columns from industry and association leaders, as well as research highlights, retailer profiles and spotlights on innovation. The site is fully searchable and easy to navigate—it also contains a number of Topic pages that speak specifically to various stakeholders. You’ll want to bookmark these! Hope: One topic we are covering more and more these days is sustainability. While the pandemic continues to dominate headlines, the environment remains a top concern for Canadians. In fact, a recent McKinsey & Company survey revealed 55% of consumers are extremely or very concerned about the environmental impact of packaging. People are looking for sustainably packaged products and vendors are taking note.

“Sustainability shifts into high gear” (p. 24) examines industry efforts to deliver products packaged in a way that reduces waste, conserves energy and curbs carbon footprint. As our experts concur, sustainability can be a major competitive advantage and one that the convenience industry can’t ignore. Plus, it’s the right thing to do. Transformation: In an eye-opening piece, “The future of convenience stores” (p. 20), the co-directors of McGill University’s Retail Innovation Lab explore how the pandemic is accelerating retail transformation and propelling innovation in the convenience and gas sectors. From technology to changing consumer priorities, hold onto your hats, innovation is everywhere. Also on the transformation front, “Riding the wave of gentrification” (p. 16) looks at how independent operator and OKBA COO Kenny Shim is constantly evolving his product mix to meet the needs of a Toronto neighbourhood in transition. Rejuvenation, hope and transformation—we’ve got it covered, not only in this issue, but also online. Our goal is to create boundless opportunities for the industry to connect, while delivering valuable resources to future-proof your business.

Michelle Warren | Editor standard

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THE BUZZ

CROSS-CANADA ROUND-UP

#CONVENIENCESTOREWEEK IN ONTARIO

Ontario MPP Stan Cho received unanimous support during the second reading of his Private Member’s Bill to designate the week before Labour Day as Convenience Store Week in Ontario. During his reading, Cho thanked the CICC, OCSA and OKBA for their support putting together the Bill, which has been referred to committee and is expected to pass. Convenience Store Week in Ontario will coincide with National Convenience Store Week, which is to take place August 30 to September 3, 2021.

PEOPLE, PLACES, NEWS AND EVENTS

B.C. TAX CHANGES AFFECT SUGARY DRINKS

The B.C. government says new tax changes include the elimination of the provincial sales tax exemption for carbonated beverages that contain sugar, natural sweeteners or artificial sweeteners. The tax will apply to all beverages dispensed through soda fountains or similar equipment, along with all beverages dispensed through vending machines.

READ MY LIPS

Spring is budget time. Quebec will not increase taxes on tobacco products (the Belle Province has the lowest tobacco taxes in the country). In addition, New Brunswick, Nova Scotia and Prince Edward Island are not increasing nor introducing new taxes on tobacco. However, Saskatchewan is introducing a 20% tax on the retail price of all vaping liquids, devices and products starting Sept. 1, while the federal government introduced a $4 levy on a carton of 200 cigarettes and a vape tax.

P.E.I. BANS FLAVOURED VAPES

Flavoured vape and e-cigarette products are now banned on Prince Edward Island. In March 2020, P.E.I. increased the age of access for tobacco and vaping products to 21. In addition, the province cut c-stores out of the equation by making products only available through vape shops and tobacconists.

COALITION RALLIES FOR BEER AND WINE IN ONTARIO C-STORES

The Convenience and Choice coalition is pressuring Ontario’s Conservative government to reconfirm a commitment to allow convenience stores across the province to sell wine and beer. The Convenience Industry Council of Canada, Ontario Korean Businessmen’s Association, Ontario Convenience Stores Association and Free My Booze are teaming up for a targeted social media initiative designed to keep the issue top of mind for those at Queen’s Park. The move, according to the coalition, will give Ontarians more choice, while supporting local businesses that have been hard hit by COVID-19.

CICC ADDS NEW BOARD MEMBERS

The Convenience Industry Council of Canada is welcoming Shell Canada as a new retailer member. Shell Canada operates 600 retail sites across the country. In addition, the Council is welcoming two new board members. Andrea Brecka, Shell Canada’s general manager retail, director & VP, joins the board. Breka’s 25-year career at Shell has spanned many of Shell’s business areas, including refining, trading & supply, oil sands and retail. In January, Husky Energy and Cenovus Energy combined and Husky is now part of the Cenovus group of companies. In turn, Karen Karpa, Cenovus’ VP of retail, replaces Lawrence Richler (Husky Energy) on the board.

| MAY/JUNE 2021

CCentral.ca

VIEW THE NEW WEBSITE!

CCENTRAL.CA

NEW AND IMPROVED

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We are thrilled to debut a new industry website, which provides news, insights, product information and boundless opportunities to connect. The new site is designed to be a valuable resource and community hub for those in the convenience, gas, car wash and related industries. In addition to the latest news, information, spotlights on innovation, retailer profiles and research, the site will feature Expert columns from industry and association leaders, including CICC Connects with Anne Kothawala; OCSA Update with Dave Bryans; Drink Up with Carolyn Fells of the Canadian Beverage Association and more. We are always looking for feedback so, please, let us know what you think! Email mwarren@ensembleiq.com

SWIC SETS RECORD

The 2021 Star Women in Convenience Awards received a record number of nominations. Many thanks to everyone who took the time to submit a nomination and to our industry partners for supporting the event and helping spread the word. Stay tuned! Winners will be announced to the public and profiled in the July/ August issue of the magazine, online and in social media. In addition, the 2021 Star Women will be celebrated during the annual Star Women in Convenience Awards Event to take place this fall!

MOVING ON UP Robert Carter is the new president of the Coffee Association of Canada (CAC). Carter succeeds Lesya Balych-Cooper, who is retiring after serving nearly seven years as CAC president. Carter brings more than 20 years of experience to the role. He is currently managing partner of The StratonHunter Group, where he leads a portfolio of companies in the foodservice and food-tech industry. Prior to that, Carter was executive director at The NPD Group. Éric Gemme stepped into the role of CFO for Quebec-based Lassonde Industries on April 1. The appointment is what the company describes as a “long-prepared transition plan” as Gemme replaces Guy Blanchette, who retired at the end of March after 14 years at the company. Gemme, who joined the company in 2014, was previously SVP and CFO of the Lassonde Pappas and Company Inc. division. Eric Huston is now general manager of Mars Food Canada. He reports to Denis Yarotskiy, regional president, Mars Food North America. Huston has been with Mars since 2016, most recently serving as strategic demand leader for its pet-care division in Canada. Huston has also held sales and marketing roles with Procter & Gamble, Heinz and Revlon. Eric Omwega is the new president of the Juul Labs Canada. He replaces Michael Nederhoff, who announced his departure in April. Maurizio Patarnello is CEO at Flow Water Inc. He takes the lead as founder and CEO Nicholas Reichenbach moves into an executive chairman role. Patarnello, who spent almost three decades with Nestlé, is being tapped to play a key role in scaling Flow to “meet its goal of becoming one of North America’s premier sustainable mineral spring water and wellness beverage companies.” Patarnello has deep experience in the bottled water business, having significantly contributed to Nestlé Waters’ growth of brands, such as Nestle Pure Life, Perrier, San Pellegrino, Acqua Panna and Poland Spring. Vincent R. Timpano is to succeed Jean Gattuso as president and COO of Lassonde Industries on October 1, 2021. The two will work together until Gattuso retires at the end of September. In September 2020, Timpano was named president and CEO of Lassonde Pappas and Company, which is Lassonde’s largest manufacturing and sales subsidiary of ready-to-drink juices and drinks. Over the past 20 years, Timpano has served as president, global coalitions at Aimia Inc., president of Coca-Cola Canada and president and CEO of The Minute Maid Company Canada.

COMING UP! The Convenience U CARWACS Show – Toronto, ON ConvenienceU.com

Star Women in Convenience Awards Event Toronto, ON StarWomenConvenience.ca

Do you have a staffing announcement to share? Email mwarren@ensembleiq.com

CCentral.ca

MAY/JUNE 2021

QUICK BITES

BY DARREN CLIMANS

Cold comfort

Consumers seek security in frozen foods, with ice cream and frozen novelties leading the way The pandemic has been a decidedly cold and isolating experience. Social distancing and unprecedented restrictions have constrained social interactions. Everyone has felt a bit chilled by the absence of daily human touch. Ironically, it appears that, when it comes to food, consumers have collectively sought security in frozen foods. According to John Carmichael, the new president and CEO of Nestlé Canada (and former president of the Foods Division for Nestlé USA), the “frozen category has outperformed all other categories [during the pandemic].” Nestlé doesn’t expect the growth of frozen to abruptly end anytime soon. Company research reveals almost 75% of people plan to buy more frozen foods, as eating at home remains the norm, with 69% looking for nutritious frozen foods; 67% seeking comfort frozen, and 54% wanting indulgent frozen items. Data from Chicago-based market research firm IRI’s retail tracking survey reported that the frozen category produced the highest retail growth +17% for eight weeks during August to September 2020, compared to the previous year. Frozen ice cream and frozen novelties were amongst the drivers of this dollar growth. According to IRI, dollar sales within the retail ice cream/sherbet category shot up nearly 16% during the 52 weeks ending Nov. 1, 2020. Frozen novelties grew even faster, +19% during 2020, compared to 2019.

Shifts in the market Ice cream sales in Canada have, until most recently, been decidedly flat. According to Euromonitor International, a global market research provider, total retail volume sales of ice cream and frozen desserts in Canada grew on average +0.5% annually between 2015 to 2020. Dollar sales growth was just over +1% per year.

| MAY/JUNE 2021

Dollar sales within the retail ice cream/ sherbet category shot up

Frozen novelties grew even faster

16%

19%

However, even before the COVID-19 bump, the tide was turning. While conventional ice cream sales were flat, there were green shoots of growth in niche ice cream segments that appealed to consumers looking for products offering quality, variety, better-for-you ingredients and superior flavour (see “4 hot trends in the freezer).

Every dog has its day Latest data confirms that the frozen foods category renaissance continues, with consumers eating frozen foods daily, or multiple times per week. Industry research points to millenials and Gen Z consumers driving growth. This bodes well for a continuation of the overall trend in a post-pandemic environment. Wondering how far the road may travel and whether to buy-in? Ben & Jerry’s recently announced that it has developed a new line of Doggie Desserts, in 4-ounce cups, to be sold in supermarkets and pet stores. Initially, the offering will be two flavours, pumpkin with cookies and peanut butter with pretzels. The doggie-novelties are made with a base of sunflower butter and the same ingredients as its non-dairy human desserts. The idea being that, when pet owners choose to reach for an indulgent frozen pick-meup, they can also treat their best friend to some cold comfort. ◗ Darren Climans is a foodservice insights professional with close to 20 years’ experience partnering with broadline distributors, CPG suppliers, and foodservice operators. His practice is to understand issue-based decisions by taking a data-driven approach to strategic decision making.

CCentral.ca

HOT TRENDS IN THE FREEZER

PREMIUMIZATION: According to DairyFoods.com 2020 State of the Industry report, the ice cream category is on fire. However, a comparison of unit and dollar sales in frozen foods overall, and ice cream in particular, highlights noticeably faster growth in revenues. Even private label dollar sales are growing faster than volume. Consumers are seeking out unique, premium-priced offerings in both multi-serve and frozen novelty purchases. For instance, Vancouver-based Betterwith—a premium, high-fat product made with traceable milk and single-source ingredients—continues to make inroads with customers.

VEGAN/NON-DAIRY: Vegan frozen dessert maker Oatly is making waves with a commitment to clean-label and sustainability. In spite of having limited distribution in Canada, and a price pushing $10/473 ml, Oatly may prove to be a future player to be reckoned with. The non-dairy frozen dessert segments are smaller, but are also showing strong growth overall. So Delicious makes a variety of non-dairy frozen desserts, as well as a new gluten-free oat-based line. Alberta-based Foothills Creamery brand Screamin Brothers is a premium frozen treat that is made from organic coconut milk. Using only wholesome ingredients, Screamin Brothers offers a safer alternative for those with dietary restrictions: sales of its dairy- and allergen-free frozen treats are up by as much as 25 to 30% per year.

REDUCED CALORIE: Though growth has slowed recently, the performance of "light" ice cream brand Halo Top has been truly disruptive. Halo Top is available across Canada at big box retailers and specialty stores (the company also recently launched seven flavours of ice cream designed for people following a Keto diet). The combination of indulgence and a low-calorie load is a winner for many consumers. For instance, Betterwith brand offers indulgent flavours, lower sugar, reduced calories and a cleaner ingredient deck. Montreal-based CoolWay, has penetrated the mainstream retail channel in Canada; its “guilt-free frozen desserts’’ carry one-quarter of the calorie load by replacing sugars and fat with natural sweeteners and clean ingredients.

CULINARY-INSPIRED FLAVOURS: Older and younger consumers are open to pushing the envelope with non-traditional flavours. For instance Winnipeg-based Chaeban Ice Cream, sold in retail, specialty and convenience stores across Manitoba, offers a Louis Lavender ice cream with purple berry orchard Saskatoon berries and sage garden lavender. Their Abir Al Sham flavour blends rose and orange blossom water, toasted pistachios, ricotta cheese and orchid root powder.

CCentral.ca

MAY/JUNE 2021

CATEGORY CHECK

BY MICHELE SPONAGLE

FROZEN ASSETS

With Canadian consumers seeking affordable indulgence, ice cream and icy treats are well poised for a sizzling summer For a glimpse of what to expect this summer for ice cream and frozen treat sales, let’s rewind a year. We were entering into unchartered territory as the pandemic marched on, people worked at home and lockdowns persisted. How many people would venture out for their favourite hot-weather pleasures? A lot it seems. According to Nielsen data: ICE CREAM SALES INCREASED BY 19%. While summer 2021 may not post the same robust figure, it’s expected the ice cream/frozen treats category will perform well. Here are five strategies to make the most of the season.

MAKE ROOM IN THE FREEZER

NEW TAKES ON OLD FAVOURITES

GET CREATIVE, GO SOFT

DISRUPT AND DIFFERENTIATE

“While single-serve novelties represent the majority of sales in the convenience channel, in 2020 we saw a significant sales increase in take-home formats, particularly in super premium tubs, says Paul McMahon, category and shopper development leader, Nestlé Ice Cream. “Expanding space for this segment provides an opportunity to grow the category and drives sales.”

This year, Nestlé’s Häagen-Dazs brand adds a new chocolate hazelnut ice cream and a Toblerone offering to its roster. While consumers may be torn between indulgence and health, Häagen-Dazs aims to please everyone with its light ice cream spinoff, Divine, boasting 50% less fat and 25% less sugar, with less than 200 calories per serving. “It’s a permissible treat that may align to their lifestyle goals, but will not require them to compromise on taste,” explains McMahon. Flavours will include Raspberry Cheesecake, Vanilla Caramel Pretzel and Chocolate Chunk Brownie.

Though ice cream sales peak in the summer, consumers in the pandemic age are looking for it year round, points out Judi Saliba, senior national account executive, TFI Food Equipment Solutions Inc. “The soft serve ice cream category is large and growing,” she says. Its popularity is also being fuelled by ice cream shops like Sweet Jesus, which offers Instagram-ready creations generating line-ups around the block. “We have seen a surge of retailers being equally successful by offering ‘designer’ cones and cups to their guests,” she notes. Soft serve also lends itself to self-service (less hands-on work for busy staff), once permitted by local health units again. “Taylor offers a soft serve model suitable for every application, as well as ancillary products that can turn a single flavour machine into one producing eight more flavours,” she says. It can be a lucrative endeavour with margins of around 80%—much higher than those for frozen novelties.

Neale’s Sweet N’ Nice is making headway into the c-store space. The Toronto company has roots in Trinidad. Charles Neale began selling his homemade ice cream made with natural ingredients, like mango and coconut, in the 1940s as a way to earn a steady income and support his 12 children. His knowledge of ice cream was passed on to his family, including his grandson and current CEO, Andrew Barnett, in Canada. “We decided to redevelop the recipe for mass manufacturing,” he says. Sweet N’ Nice gained mainstream traction in 2018 after getting listed in Sobeys and being featured on Dragons’ Den. The premium ice cream brand experienced plenty of wins and challenges last summer. Its roll-out into other stores was delayed by COVID, but experienced an uptick when the Black Lives Matter movement put on a spotlight on the importance of supporting Black-owned businesses. Sampling, so important for new brands to gain exposure and for consumers to learn about Caribbean ice cream, was put on hold, but a pop-up store was a big success. This summer, Barnett is hoping for more c-stores to come onboard with the introduction of a 100 ml grab-and-go size, as well as new flavours like banana chocolate.

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PLAN AHEAD 5 C-stores can take advantage of key sales drivers with strategic placement of POS material to let consumers know what’s available in-store, a single-serving freezer placed in high traffic areas (especially near the cash) and by ensuring freezers are fully stocked and ready for when the warm weather hits.

re ta ste. CCentral.ca

BY DONALEE MOULTON

Digital signage 101 Pros, cons and best practices

With the fall out of the pandemic— shoppers spending less time in store, reduced foot traffic, masks and distancing—operators are looking to digital signage to close the communications gap, entice customers inside and boost sales.

On the plus side There are many advantages to digital signage. One benefit: variety. You can advertise more content with digital media by running advertisements in a loop that promote a number of products over a set time period. “These ads can rotate every eight to 10 seconds. Therefore, you can push more advertising in comparison to static print media,” says Linda Hofflander, chief strategy officer with Skykit LLC, a digital signage company based in Minneapolis, MN. She notes that store appearance is also enhanced with digital signage. “If done properly, it can provide better aesthetics to the location that is welcoming to the customer and it also brings the store in line with modern tech.” Digital signage also offers c-stores flexibility. Ads are easier to update and keep current. Digital media is instant, says Tim Walker, a marketing expert and partner in Revinmedia, Soapy Brushy and Midfield Interactive, in Dundas, Ont. “[It] offers the ability to change promotions in real time.” It also helps the bottom line, he adds: Users can generate revenue by selling ad space.

Media Solutions’ general manager for Canada. “However, if you can work with vendors, those costs can be offset.”

Latest innovations The digital space is changing—significantly and rapidly. Among the most recent innovations are the rise of system-on-a-chip displays, cost-effective hardware, flexible installation, and more user-friendly software that allows for a higher number of integrations. “The driving force behind all of these changes is the desire to make digital signage more accessible and easy to use,” notes Hofflander. “In that respect, mobile connectivity is also becoming more prevalent.” Skykit, for example, has launched a mobile-ready media player that allows organizations to deploy digital signage on a secure mobile network rather than relying on access to Wi-Fi or ethernet. This extends the reach of digital signage. “Convenience stores can now easily push content to screens located on the outside of buildings, in-store vestibules, and elsewhere,” says Hofflander. Other trends include, facial recognition, movement recognition and interaction, promotion automation and interactive screens. “Digital signage is a first step of technology bridging the gap between behaviour and offering a seamless transition, where it puts the customer at the centre of it all,” says Walker.

Bottom line

On the minus side Prepare for ongoing hardware and software costs. “Hardware has a shelf life, and depending on the operation of the hardware 24/7, at some point the hardware needs to be replaced,” says Markus Merrill, Vend Data CCentral.ca

Digital signage—indoors and out—enables you to promote, cross-sell, and upsell products and services. “A display or external digital signage can increase footfall and offer a reason to return depending on the content displayed on the screens,” notes Walker. He points out that corporate-owned c-stores have branding and messaging that is unified and can be standardized across their network. Independent c-store operators, unless they have support and content from their vendors, will most likely need to be a part of a digital media platform that relies on media agencies to sell the space and share the revenue with that retailer. ◗

TOP OPS

BY THE NUMBERS Statistically, here’s what digital signage can do for your business.

400%

46%

33%

35%

more views than static displays

growth in repeat buyers

boost in customer satisfaction

perceived reduction of waiting times

29% bump in average purchase Source: Revinmedia

BEST PRACTICES Guillaume Robert, VP go-to-market strategies and commercialization with Nummax, a signage company based in Quebec City, has this advice for c-store owners new to digital signage.

✓ DETERMINING YOUR GOAL — why you want digital signage—is the first step. Once you’ve answered this question, you’ll be better able to narrow down the best location. ✓ LESS IS MORE. Avoid having too much digital dynamic signage. Choose your prime spot and use it wisely. ✓ ALWAYS BUY FROM A

COMPANY THAT PROVIDES DOCUMENTATION AND RESOURCES that make you autonomous.

And buy from a company that can provide you technical support in North America.

✓ LOOK AT THE WARRANTY and make sure that you can have parts shipped quickly in case of a hardware issue.

✓ SOFTWARE TO MANAGE THE

CONTENT OF YOUR DIGITAL DISPLAY must be easy to access, easy to

use, and easy to schedule.

MAY/JUNE 2021

| 11

HAND IN HAND

Distribution partners play a crucial role in the success of c-stores BY WENDY HELFENBAUM

Canada’s distribution network moves more than $55 billion in goods and services to c-stores each year. And since the pandemic shifted the universe last year, c-stores that were designated essential services became lifelines to consumers from coast to coast. Distributors have always been an integral part of the convenience supply chain, but their role has become even more pronounced. We asked three industry leaders to weigh in on what’s changed, how the operator-distributor relationship has evolved, and what to expect as we move forward to our new normal.

Joint ventures Along with everything else since the onset of the coronavirus, the c-store operator-distributor relationship has evolved, and in a good Dan Elrod way, says Dan Elrod, president of Wallace & Carey in Calgary. So has managing, ordering, delivery and set-up. “Our relationships have become much closer and, in many cases, more collaborative,” explains Elrod, noting that as c-store consumer needs have changed, smart retailers have stepped up to meet those changing demands. With traffic down from 15% to as much as 75% for some operators, retailers pivoted quickly to more staples, larger sizes, and supplies of PPE products, adds Elrod. “Some launched delivery options, including apps for customer use in placing orders. Those wholesalers, having adapted quickly to these changing needs, have certainly fortified customer relationships. And those having true partnerships—as opposed to only buy-sell

| MAY/JUNE 2021

relationships—are emerging as leaders in meeting the demands of Canadians through these trying times.” The COVID-19 crisis brought many businesses together, because everyone had common goals, says Peter Kerr, VP, national key accounts & sales at Sobeys Wholesale in Mississauga, Ont. “At the onset, it was panic buying on critical items like— toilet paper, sanitizers, disinfectants, and grocery items,” says Kerr. “As a distributor, Peter Kerr we were struggling with long-term out of stock items, manufacturers delaying smaller pack items which are critical in the c-store environment, production adjustments and limitations to availability. Our teams have had to act quickly to ensure that product availability is met with each retail customer.” Continued collaboration between customers at the head office and site level ensured that information flowed accurately and on time, he adds. Increased communication has been critical in fostering strong partnerships, as public health and government guidelines were updated daily, agrees Serge Nadeau, VP, projects & development at Quebec-based Beaudry & Cadrin Inc. “Getting products from providers has been a challenge, because a lot have been out of stock for a long time,” says Nadeau. “It has taken a lot of research and hard work to get everything. We faced a big change in volume with different food categories; tobacco and wine categories increased. And because more

sanitary processes were put in place, we lost efficiency, added hours to continue providing good service and took on more expenses.”

Lasting impacts After most provinces recognized c-stores and their wholesale distributor suppliers as essential businesses, wholesalers were able to continue making deliveries and providing retailers with the necessities their customers required. But there was a shift in perspective as industry players learned from the shared challenges brought on by the pandemic, says Elrod. “Retailers realized the wisdom of minimizing the number of deliveries they received, and the corresponding touch-points required during a delivery,” he explains. “This consolidation of supply reduces store labour costs, minimizes the likelihood of transmitting infection, and benefits the environment through improved transportation efficiencies. I expect developments such as self-checkout, pickup and delivery, and other emerging innovations to see wider adoption in the c-store industry.” Kerr believes the pandemic will likely change many facets of the distribution model in the future. “We’re continually sourcing hard-to-find products, while quickly responding to a reactive consumer purchasing behaviour, creating responsive supply chain opportunities which will likely change behaviours going forward,” he says. One of those behaviours will surely be continued sanitary processes, and larger demand for meals, adds Nadeau. “Convenience stores became a destination for consumers for meals,” he explains. “We’re a licensed distributor for M&M Foods and we’ve seen a huge increase with stores offering ready-to-serve or frozen meals.” CCentral.ca

F E AT U R E

Strategies for success “Exceptional fill rates and on-time delivery results are the price of admission for a successful wholesale distributor; they are essential to every c-store retailer’s success,” says Elrod. Support, safety and security have become key priorities as well. The pandemic drove home the point that wholesalers must develop effective best practices and protocols to ensure that delivery drivers and retail staff are protected during the delivery process, he adds. “An effective partnership requires the wholesaler to know where the retailer is going, and invest in technology and infrastructure to support that vision,” says Elrod. Close communication at the leadership level, along with speed to market on innovation, ensures everyone shares the same goals and strategic path so operators can run their sites effectively and efficiently, agrees Kerr. “We work with our valued customers to ensure that they have the best sellers included in their assortments and that they have all new impulse items and seasonal products prominently displayed,” he explains.

CCentral.ca

Kerr’s team also encourages c-store operators to use social media to attract their consumers to their store, and assists with substitute items due to manufacturing adjustments, as well as with planograms and displays to attract consumers while in their stores.

Building a winning operatordistributor relationship Above all, c-store owners need distributors who are available to them, insists Nadeau. “As distributors, we have to make their business life easier,” he says. “We have to advise them on the latest trends and newest products. And new concepts must be developed to meet consumers demands, such as fresh food, frozen meals and diversified ready-to-serve meals.” Nadeau believes that consumers feel more at home in their neighbourhood convenience stores than ever, so distributors have taken on a bigger role. Serge Nadeau

“We’re no longer just distributors; we are consultants and specialists in this sector,” he says. “We have to adapt our offerings according to our customers’ location and the community they serve.” Performance is the key driver to a successful, productive wholesaler-retailer relationship, adds Elrod. “Distributors also need to have a clear understanding of the metrics needed to achieve the retailer’s service objectives, diligence in exceeding these, and ongoing communication to ensure the KPIs, when met, are achieving the customer’s goals,” he says. In his three decades working with c-store retailers, Elrod says one facet still holds true: Listen to your customers. “The c-store industry is a fast-paced environment where winning and losing is determined by meeting the consumer’s needs, literally every hour of every day,” he explains. “Operators know what those needs, and by default, their needs are. They’ll tell you, if you’ll only listen.” ◗

MAY/JUNE 2021

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Riding the wave of gentrification Kenny Shim’s Busy Bee King Mart maintains its status as a neighbourhood destination by constantly evolving to meet the needs of its Toronto neighbourhood BY CHRIS POWELL PHOTOS BY JAIME HOGGE

| MAY/JUNE 2021

CCentral.ca

R E TA I L E R S P OT L I G H T

Kenny Shim has been a ﬁxture in Toronto’s west end for more than 26 years, a link to the recent past even as this formerly sleepy neighbourhood at the edge of the city’s entertainment district has been completely transformed. When Shim took over the Busy Bee King Mart at 677 King St. W. in October 1994, the King and Bathurst neighbourhood was a mix of commercial and residential properties, with an older, largely Portuguese population, says Shim. But as business and property taxes skyrocketed, and the companies that once had their headquarters in the area decamped for the suburbs, the office buildings were converted into lofts and condos that attracted a new wave of younger, affluent tenants. Seemingly overnight, Shim’s customers went from shopping for budget pet food, two for $1 bread and KitKat bars, to buying expensive organic chocolate carrying a $7 price tag. “It’s changing every day, and if you don’t evolve and accommodate the needs of consumers, you’ll perish in a second,” says Shim of the need to stay abreast of changing consumer tastes.

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Shim, who has served as chief operating officer of the Ontario Korean Businessmen’s Association since 2019, hadn’t planned on a career in retail. He was working in IT after graduating from the University of Waterloo when he was asked to help manage a convenience store for a sick relative. “I think I did quite well, and ended up taking over the business,” he says. At one point, Shim operated as many as five 24-hour stores in Toronto’s downtown, but has since scaled back to the single location: He’s in his late fifties and wants to make more time to travel. Today, Busy Bee’s customers are typically young couples or single people living in one of the countless condo buildings that dot the neighbourhood, popping in for everyday grocery staples or staggering in after a raucous night at the nearby clubs. “If you’re a single dweller living downtown, and you need something at 1 a.m., you come to my store and you’ll find either exactly that item or something close,” says Shim. His 2,880-sq.-ft. store is tidy and well-stocked. There’s a surprisingly robust home section offering everything from power cords and paint rollers to wall outlets and combination locks, as well as an extensive—and enticingly colourful—assortment of noodle products. It also features nearly 100 kinds of organic

MAY/JUNE 2021

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chocolate from manufacturers including, Ottawa-based Camino, Green & Black’s and Alter Eco. But it’s in the beverage aisle, which takes up nearly one entire side of the store, where Shim’s store truly shines. He estimates that throughout the year he carries between 800 and 1,000 beverage SKUs, including multiple offerings from brands like Britain’s Fever Tree (flavours include Sicilian Lemonade, Cucumber Tonic Water and Elderflower Tonic Water), as well as GT’s Synergy Kombucha and Two Bears. “I have so many beverages, it’s not funny. You name it, I got it all,” says Shim, who sources items from the Ontario Natural Food Company and United Natural Foods (UNFI), as well as smaller local distributors, to meet the seemingly unquenchable consumer appetite for different beverages. UNFI will often send Shim samples of drink products it thinks will be a hit with Busy Bee’s customers, which typically leads to extensive sampling among Shim and his staff. “Everything I sell, I’ve got to try,” says Shim. “Sometimes I sit down with my managers and my staff to try them out, and sometimes we’ll discuss with customers.

| MAY/JUNE 2021

We’ll start carrying a few SKUs, and if we sell them all they become our permanent stock. If we don’t [sell them], we’ll sell them cheap, or I drink them.” Products associated with health and eating better are hugely popular right now, says Shim, noting the growing demand for Keto-friendly snack bars and the success of a low-sugar candy brand called SmartSweets. “I didn’t think it was going to sell, but I just can’t keep it in stock,” he says. Right now, Shin is focused on riding out the pandemic and coping with rising rents at the same time that sales have plunged. Customers are still coming in to buy the staples, he says, but with no less than 23 bars and restaurants in the immediate vicinity, nighttime sales have been hit particularly hard. “It’s not easy, but what can you do,” he says. He admits to being a little worried about the ability to bring some regular clientele back after they’ve been away for more than a year. “I think I have to come up with some sort of strategy to get back my customers and re-introduce [the store] to my neighbourhood,” he says. After three decades in the same spot, it might not be as hard as he thinks. ◗

Operator insights 1|

Change with your customers: Evolve your

products and services to accommodate their tastes. Shim sells close to 100 kinds of organic chocolate.

Carve a niche and own it: Shim’s beverage

aisle takes up nearly one entire side of the store and features between 800 and 1,000 beverage SKUS.

Take risks with new products: Keto-

friendly snack bars and low-sugar candy were an unexpected hit with young condo-dwellers.

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THE FUTURE OF CONVENIENCE STORES The co-directors of McGill University’s Retail Innovation Lab explore how technologies and shifting consumer behaviours are converging to revolutionize retail

CHARLES DE BRABANT

PROF. MAXIME COHEN

BY CHARLES DE BRABANT AND PROF. MAXIME COHEN Over the last few years, retail has been in a state of profound transformation. The COVID-19 pandemic has strongly accelerated this transformation. Consumers are significantly changing what they buy and how they shop. They are better informed, price sensitive, and they are looking for convenience, personalization, and a seamless omni-channel experience. Consumers are also more focused on safety, health and well-being, protecting their privacy, promoting their local community and environmentally conscious. At the same time, we are witnessing unparalleled technological innovations through AI, robotics and big data, just to name a few. These new technologies are allowing customers to experience frictionless retail and enhanced services, while allowing retailers to digitize and put in place effective omni-channel operations. This has led retail to become one of the most innovative sectors. This is not only due to the rise of Amazon, Alibaba and other digitally native players, but also to more traditional retailers, such as Walmart, Nike, Lululemon, and retail tech players like Shopify and Lightspeed.

| MAY/JUNE 2021

As a result, convenience stores are being forced to adapt to these changes faster than ever before. This shift is also being accelerated by the fact that big convenience players, such as 7-Eleven and Alimentation Couche-Tard, are seeing fewer opportunities to grow through acquisitions and thus must find new ways to grow organically within their existing networks of stores. This involves not only the use of new technologies, but also shifting the culture, mindset and processes to allow innovation to thrive.

Greater convenience and the role of technology We are witnessing a strong move to offer more convenience, ease of shopping and safety to consumers and employees. The first big trend is towards frictionless retail. In North America, Amazon Go has led the way. As for convenience stores, 7-Eleven started piloting mobile checkouts in 2018 in Dallas and is now available in Utah and New York. In February 2021, the company announced that it was testing its first cashierless store concept with an inhouse custom-built technology.

Couche-Tard has also moved aggressively. They announced in 2020 that they were piloting touchless, autonomous checkouts in partnership with Standard Cognition. They currently have several pilot stores in Arizona. The technology leverages ceiling-mounted cameras with proprietary AI and computer vision software to associate each customer to the items they pick up. CoucheTard has also partnered with McGill University and in January 2021 launched the first frictionless store in Canada. The key to these innovations is to identify key pain points along the customer journey. Beyond introducing innovations like curbside pick-up, other examples are:

Simplifying the fuelling experience though licence plate recognition of loyal customers. This allows customers to have the fuelling station identify them as they arrive, immediately prepare the fuelling station and debit automatically their payment.

Bringing the store out to customers. As customers are refuelling, they can buy products from a grab and go frictionless vending machine next to the fuelling station. CCentral.ca

T E C H TA L K

Product offerings— innovating with the times Convenience stores are also experimenting and upgrading their product offering to align with consumer trends and new generations of consumers. As the pool of electric vehicles increases, convenience store operators are experimenting with the introduction of electric charging stations. We are also witnessing a number of different product innovations, such as:

THE RETAIL INNOVATION LAB (RIL) AT MCGILL UNIVERSITY

Upgrading the standard product offering. For example, Couche-Tard has introduced higher-quality coffee with their new self-service coffee machines.

CONSUMERS ARE SIGNIFICANTLY CHANGING WHAT THEY BUY AND HOW THEY SHOP

Building off the trend of local shopping by offering, for instance, locally craft beers and local specialties.

The Retail Innovation Lab (RIL) at McGill University One setting that combines all the above elements is the RIL at Mc-

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Gill University, which opened in the heart of Downtown Montreal in January. The lab is a live, open and transactional convenience store environment. This allows Couche-Tard to work with leading edge academic researchers on areas such as, frictionless operations, artificial intelligence, sustainability innovations, and the trade-off between personalization and privacy. All these initiatives are showing that we are living in an exciting time for the future of convenience stores to take advantage of the new realities brought by shifting consumer demands and rapid technology advances. COVID-19 has substantially accelerated the need for change. Several players are testing and innovating to make customers’ lives easier and the shopping experience more personalized and frictionless. ◗ Charles de Brabant is executive director, Bensadoun School of Retail Management, at McGill University. Prof. Maxime Cohen is associate professor of Retail Management and Operations Management and co-director, Retail Innovation Lab, at McGill University.

MAY/JUNE 2021

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Product of the Year Canada

y t i l i b a n i a t s Su o t n i s t shif r a e g h hig Survey after survey shows consumer awareness is higher than ever that product packaging contributes to plastic waste in landfills or as litter in waterways. However, after the pandemic hit, the top-ranked criteria driving consumers’ food and beverage purchases shifted to hygiene, food safety and shelf life, according to an August 2020 global survey from McKinsey & Company. But that doesn’t mean consumers aren’t watching for products packaged in a way that reduces waste, conserves energy and curbs carbon footprint. The survey also found 55% of consumers are extremely or very concerned about the environmental impact of packaging and would buy additional sustainably packaged products if more of them were available and they were better labelled. McKinsey’s study also found that the COVID-19 crisis has significantly heightened consumer sensitivity to new preferences for packaging materials—in particular, recyclable and recycled packaging and in-fibre based substitutes.

| MAY/JUNE 2021

Jordan Fengel, sustainability manager, U.S. and Canada at Tetra Pak—whose low-carbon-footprint carton packaging is used in Canada by the likes of Coca-Cola on its juice brands, Flow Water, Lassonde and Grand Pré milk—says their recent consumer tracking has found increased attention on packaging. Consumers want it to be “higher performing in terms of longer shelf life,” he says, but also environmentally sustainable. “Once we come out of the pandemic, I think sustainability will regain its top position as a consumer focus, which is why we haven’t seen food and beverage vendors back away from announcing new commitments.” (see “Setting new goals”.) In other words, sustainability is no trend. Rather, it is a critical issue for both c-stores and their product suppliers around the globe and here in Canada, due, in part, to new federal plastics regulation. It stipulates that all plastics sold in Canada be made from at least 50% recycled material by 2030. “Packaging serves a critical role in maintaining both freshness and safety,

The pandemic has changed consumer buying criteria, but the move to more sustainable packaging and products is accelerating BY CHRIS DANIELS

but waste from plastic packaging is a growing issue,” says Katya Hantel, senior director of sustainability at Conagra Brands. “Sustainable packaging solutions is one part of Conagra’s broader commitment to responsible sourcing.” “Sustainability can absolutely be a competitive advantage,” agrees Brianna Ames, director, public affairs, comms and sustainability at Coca-Cola Canada, which is testing a paper bottle (see “Repackaged: New innovations”). “Consumers care more and more about the environment and have higher expectations for companies to do their part.” Major c-store operators are also all-in on sustainability as an overarching business imperative. By 2025, Couche-Tard has promised to increase sustainable packaging for foodservice and private brand consumable products by 25% over 2020. And by 2030, it hopes 100% of the packaging will be recyclable or reusable. “For us, sustainability has evolved from being individual actions by teams within the company to now being a

CCentral.ca

PLASTICS BAN In fall 2020, the federal government announced a ban of six single-use plastics items by 2022—grocery bags, straws, stir sticks, plastic cutlery, six-pack rings and food containers made from hard-to-recycle plastics. However, according to a February poll from Abacus Data commissioned by Oceana Canada, two-thirds of Canadians support expanding the ban to cover items commonly found littered in the environment and polluting waterways: hot and cold drink cups, cigarette filters and all forms of polystyrene (Styrofoam).

BIN IT TO WIN IT

business lens across our entire organization,” says Helena Winberg, CoucheTard’s director of global sustainability. “This is how we can ensure that we are having the most impact for all our stakeholders and connect the dots of individual contributors.” But to ensure there is no breakdown in building a ‘circular economy’—recapturing the value of the materials used in packaging for new packaging—it needs to be recycled. That is where both big and small c-store operators can individually play an important role at the ground level (see “Bin it to win it”). In addition to packaging, Mackenzie Davison, growth lead at Mondelēz Canada, says “consumer awareness and understanding of sustainability sourced products is increasing” as well. It has added a “Cocoa Life” logo to its chocolate products, to let consumers know that their cocoa is sustainably sourced. “We want to give our consumers the confidence that whenever they buy Mondelēz products, it will not only taste good, but do good too.”

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There is something c-store operators can do at the store level that has proven to help in a big way with creating a sustainable, circular economy and that gets customers involved: enable them to recycle while exiting the store and while refuelling or charging their vehicles. A “waste audit” from the Canadian Beverage Container Recycling Association (CBCRA) found that 63% of the contents thrown into the garbage in front of a c-stores and at gas pumps without blue bins is actually recyclable. Of that recyclable content, 2% to 8% is beverage containers. In Manitoba, when 7-Eleven stores with gas stations had recycling dispensers for customers installed for the first time in 2019 and 2020, the CBCRA found most recyclable content came out of the garbage –82% to 93% of it—and into their proper receptacle. “It is amazing how many people clean out their car while filling it up with gas, but a lot of them don’t wait until they get home to dispose of the recyclables,” says Ken Friesen, CBCRA’s executive director. “But if you make it convenient for them— which is what a convenience store is supposed to do—customers take the care to recycle.” A side benefit for c-store owners involved in the 7-Eleven project: less litter around their stores.

“When people have a choice of both a garbage and recycle bin, they seem to take more care about disposing things in the garbage, too, like candy wrappers and chip bags,” says Friesen. By adding a recycling program, c-stores will also be supporting the ramped-up efforts of their key vendors. Beverage and snack manufacturers in Canada are looking to do a better job of encouraging consumers to recycle. Coca-Cola, for instance, told Convenience Store News Canada it has created four new “Recycle Me” messages for its soft drink, smartwater and Gold Peak bottles. Each bottle will feature one of the new labels starting this year. Catherine O’Brien, SVP, corporate communications for Nestlé Canada—who is responsible for the company's environmental sustainable strategy—says Nestlé aims to have 100% of packaging recyclable or reusable by 2025, up from the current rate of 87%. “Across our products and with our employees, we try to emphasize and educate proper recycling practices. This same practice can be cascaded to Canadian consumers at convenience stores with in-store signage,” she says. Mondelēz International—which makes brands like Caramilk chocolate bars, Dentyne Ice gum and Halls cough drops—has committed to making 100% of its packaging recycle-ready by 2025 and will include recycling labelling information. “It is part of our plan to deliver on our long-term vision for zero net waste packaging,” says Mackenzie Davison, growth lead at Mondelēz Canada.

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REPACKAGED: NEW INNOVATIONS PAPER BOTTLES This spring, Coca-Cola will debut its first paper bottle when its plant-based drink, AdeZ, is tested in Europe. The bottle is made of sustainably sourced wood by Danish startup Paboco (Paper Bottle Company) and features a bio-based lining that acts as a waterproof barrier to prevent the bottle from getting soggy. Brianna Ames, director, public affairs, communications and sustainability at Coca-Cola Canada, says “design is a key pillar within our ‘World Without Waste’ initiative.” ‘SMART’ PACKAGING Nestlé is switching Smarties to recyclable paper packaging, “which will be available in Canada beginning late April,” says Catherine O’Brien, SVP, corporate communications for Nestlé Canada.“We are excited to be the first global confectionery brand to shift to paper packaging.” This represents a transition of 90% of the Smarties product SKU, and eliminates about 250 million plastic packs sold worldwide. CANNISTER TO CUBE Canisters are the conventional shape for products like hot chocolate mix, but they aren’t eco-friendly and take up a lot of space on shelf. In the U.S., Conagra has moved from round canisters to a more eco- and space-efficient recyclable plastic cube for its Swiss Miss Hot Cocoa line. The new design reduces by 15% the carbon footprint associated with manufacturing and transporting the hot cocoa containers.

Coca-Cola will debut its first paper bottle with its plant-based drink, AdeZ

SETTING NEW GOALS In March, Hershey set a new pledge to reduce packaging weight an additional 25 million pounds by 2030. It also aims to have 100% of its plastic packaging be recyclable, reusable or compostable by 2030.

Also in March, Mondelēz increased its commitment to reduce the use of virgin plastics in rigid plastic packaging by 25%. This equates to an overall 5% reduction in virgin plastic use.

In January, PepsiCo announced plans targeting a reduction of absolute greenhouse gas (GHG) emissions across its value chain by more than 40% by 2030 and net-zero emissions by 2040. The company is in the midst of a 2017 commitment to ensure 100% of its packaging is recoverable or recyclable by 2025.

In December 2020, Nestlé laid out a global roadmap to achieve net zero greenhouse gas (GHG) emissions by 2050. Currently, 87% of its packaging is recyclable or reusable and the plan is to ensure 100% is reusable or recyclable by 2025.

More than 40 partners came together to form the Canada Plastics Pact (CPP) in January. Jim Goetz, president of the Canadian Beverage Association (one of the CPP’s founding members. along with the likes of Coca-Cola Canada and Keurig Dr Pepper Canada), calls it a think tank between industry, NGOs and other stakeholders. “It will be about discussing how we can achieve both the goals of the province and the federal government in reducing plastic pollution and growing the circular economy in Canada,” he says.

Ferrara, manufacturer of candy brands like SweeTARTS and Nerds, pledged in December 2020 to make all packaging 100% reusable, recyclable or compostable by 2025.

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ASK THE EXPERT

Q Retail consultant Lisa Hutcheson shares 5 strategies to attract, retain and motivate employees It is no secret: retail is notorious for having high staff turnover. Front-line retail staff turnover, particularly in convenience stores, is often 100% or greater. That means that all the front-line employees working for you today, might not be working in your store one year from now, then the process of attracting and hiring new employees happens all over again…ugh! Not only is the toll of recruiting and hiring a challenge for already time-starved owners and managers, but also the total cost of employee turnover for businesses is high and impacts the bottom line. The cost of turnover for an average store associate is estimated to be about $3,500. Moreover, statistics demonstrate that two out of three employees who leave during that first year, do so in the first six months.

Why do employees leave? A recent survey examined the reasons employees voluntarily left an organization and found that the majority of challenges could have been prevented by the employer. According to the Work Institute, 2020 Retention Report, top reasons include: · Manager behaviour · The work environment · Work-life balance · Job characteristics · Employee well-being · Compensation Understanding these issues helps determine what strategies can be put in place to recruit, attract, retain and motivate employees.

1 | Employees want to feel safe Due to the nature of convenience stores,

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BY LISA HUTCHESON

Retail has a high turnover and this seems to be an added challenge in the convenience sector, especially during COVID-19. How can convenience retailers, from chains to independents, address this problem?

the working hours often involve evening and night shifts. Layer the more recent concerns regarding exposure to COVID-19, and keeping employees safe becomes even more important. Management should instill confidence in their employees by including COVID-19 safety in their training and equip stores with HD cameras and emergency buttons. In addition, establish a policy that puts management and employees on the same side—customer frustrations and management passivity can be a major point of friction, especially with the anti-mask movement.

2 | Recruiting tools and assessments

Large retailers have been utilizing technology and recruitment software tools for some time now. However, new tools are available for smaller chains and independent retailers. One such tool is a new app called Swob, which is specifically targeted at hiring front-line retail. It works like a dating app: Recruiters create a profile with job details, while potential employees create profiles with their qualifications. Using the app, recruiters or job searchers can search (or swipe) through qualified candidates using a variety of filters, including distance and availability. This means that a retail location can quickly fill vacancies, without a lot of downtime. Another tool is the Fascinate Assessment, which identifies optimal roles for each associate, predicts who will work best together, understands how each person manages their time and recognizes leadership qualities in high performers.

3 | Referral and signing bonuses Like a seed into a sapling, referral bonuses can help grow a retailer’s network by rewarding employees for recommending people in their network (with the obvious benefits of potential candidates having been vetted

first by the employee). Some retailers offer an extra bonus if the new hire stays longer than one year. At the end of the year, paying the bonus is more cost-effective than turnover.

4 | Training Confusion over job requirements should be put to rest during onboarding and training. Open the lines of communication from the start so employees are willing to raise their concerns, rather than quit over them. The training should also clearly delineate what parts of the job employees will not be held responsible for. Often, a major point of frustration for employees is being asked to do something outside their job requirements— and especially not being compensated for it.

5 | Perks—that are meaningful Compensation is ranked as one of the lowest reasons why employees leave. While you don’t have to offer the highest hourly rates, perks and going the extra mile to show that you truly care for your hourly team is very meaningful. According to Robert Half, a recruiter and employment agency, top work perks include, flexible schedules, employee discounts and volunteer time off (more companies are sponsoring employees to spend time volunteering in their communities). Retail continues to be challenged with high turnover. However, using these proven approaches to attract and retain your c-store employees is the first step in combatting turnover and creating remarkable retail teams. ◗ Lisa Hutcheson is a retail consultant with a mission to help clients create a remarkable experience for their customers and extraordinary profits for their stakeholders. Her consulting practice provides clients with retail strategy expertise, as well as customer and employee engagement strategies, including her signature ‘Remarkable Retail Teams’ program. Hutcheson is also a frequent speaker on retail trends and customer experience, as well as a part-time professor teaching retail marketing and organizational management. She can be reached at lhutcheson@jcwg.com

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One year later

VOICES

Convenience and COVID-19 It’s been more than a year since the pandemic turned the world upside down and so much has changed. In spring 2020, just as provinces and territories across the country recognized convenience and gas operators as essential services, Convenience Store News Canada surveyed readers, asking: “How is the coronavirus affecting your business?” On one hand, you were honoured to step up and serve your communities in times of crisis, on the other, you were concerned about safeguarding staff and customers, stocking shelves with key items and, in some cases, keeping the lights on. Overwhelmingly, questions revolved around how this would play out long term. Here we are, one year later, and it’s still playing out. Unlike many retailers, c-stores remained open throughout, but that doesn’t mean the industry emerged unscathed. With reduced foot traffic, changing consumer behaviours, less travel and added operational expenses, the pandemic has been hard on the bottom line for many. Here’s what some of you had to say about running a business during a pandemic and lessons learned. *responses edited for clarity and space

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Twelve months ago I was on my way home from a trade show in Toronto. As I drove the QEW, the music was interrupted with an announcement that a pandemic had just been declared. I told my twin daughters, who were with me, that it meant all hell was about to break loose. Sadly, I was right...by the time we arrived at our local Walmart my worst fears were confirmed. People were in a panic. All essentials were gone and it looked like a war zone. Everyone looked terrified and that’s how I felt, too. I knew what I’d be faced with when I opened my store the next morning. The next few months were a blur. By-laws and medical professional recommendations seemed to change before we could get used to what we were currently supposed to do. Keeping products on my shelves for my customers was a huge challenge, especially since big box stores weren’t able to do so. I quickly learned that the positive relationships I had built with my suppliers and sales representatives would prove more valuable than I could have ever imagined. Being in a semi-remote location means not all of our clients have quick access to a grocery store or pharmacy. My sales reps were absolutely amazing! While I was worrying about the depleting supply of toilet paper or sugar (that I was keeping in the back room and selling one at a time to customers), I would be elated to receive a call from a rep saying they had a case of toilet paper, sugar, yeast, flour etc. It was like being told I’d won the lottery! Our customers have really stepped up as well, thanking us for being here and following guidelines. We are all dealing with this fluid, unknown, new normal, and we each have our own struggles as a result of this pandemic and business closures and lockdowns. I just hope that, through it all, we can remember we need to work together. Be safe all.

People are overall more thankful, appreciative and value the work that others are contributing to society. We have also been able to advance our knowledge in digital platforms that, without the pandemic and resources provided, we would not have progressed as far. Being a new business (opening September 2019), however, we felt overlooked with some of the government support programs.... for those of us continuously functioning and adapting, while learning how to run the basics of a business, it has not been easy. Advice: Belong to groups that will help you navigate complicated times, such as the CFIB, Chamber of Commerce, convenience associations, etc. These groups have been immensely helpful in providing knowledge, sharing ideas and best practices.

JULI-ANN LEVA The Store, Chippawa, Ont.

DENISE AND MILT WILSON Burks Falls Kwik-Way, Burks Falls, Ont.

KRISTEN WRIGHT DRAPER Crediton Variety & Gas, Crediton, Ont. In my store [located in the foot of a condo, between the base of the CN Tower and Scotiabank Arena], sales are down an average of 35%. I would rather have seen everything close 100% for a month [until there was] no COVID-19, then back to business. Now, the priority should be vaccines for convenience store staff. SHELMON KHAMIS Hasty Market, Downtown Toronto Initially, we had a large drop in sales, then, within six weeks, we saw an increase in traffic into our store. With plastic barriers and a mask-required policy, 99% of customers have adhered and feel safe while shopping. We saw an increase in sales. Fresh ready-to-eat foods increased. Lottery sales increased and snack and comfort foods all increased. Baking supplies, which had slowed greatly over the past decade, made a huge increase in sales. The daily stress of the pandemic has played greatly on our staff. We shortened our hours when the outbreak began and have kept the shortened hours in place. We sold our business in January 2021. We had planned to sell before the outbreak began, but it sure made it easier to move on.

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SNAPSHOT

BY KATHY PERROTTA

Are you ready for the new kids on the block? Ipsos data reveals Gen Z consumers’ pandemic priorities and what they mean for your business

Conscious consumption

Defining generational habits and traits are often shaped by shared formative experiences and major life-changing events. Transformational occurrences like the Great Depression certainly impacted behaviours and needs of the Silent Generation (aged 75+), while 9/11 impacted and imprinted millennial (aged 25 to 41) practices and perspectives. The current global health pandemic and societal lockdowns are no different. While our pandemic experience has prompted change across the generations, it potentially stands to have the biggest longterm effect on activities and attitudes of Gen Z consumers (aged 11 to 24 and born between 1997 and 2008: though that definition may vary slightly depending on who you ask). The cohort currently represents almost 20% of the Canadian population. Gen Z priorities, particularly among the leading Gen Z adult segment (aged 19 to 24) are shaped by egalitarianism, diversity and a conscious code of ethics. Beliefs and perceptions of the younger Gen Z segment (aged 12 to 18) are currently being modelled in these turbulent times. Gen Z food-shopping habits continue to show strong development at convenience and gas outlets. However, fewer immediate consumption trips and more online shopping options necessitates that stakeholders update their understanding of the evolving needs and habits shaping Gen Z choices, especially if they want to remain relevant in the post-pandemic era.

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Ipsos FIVE daily consumption tracking data reveals that a key element shaping eating and drinking choices is consideration for options that support the "social good". Activating against Gen Z's desire to support brands that address environmental and ethical concerns, provides boundless opportunity across many core categories. Priorities include, food safety, quality (nonGMO, organic), local products/ingredients, sustainable packaging, sustainability, fair trade and treatment of workers in the production process.

Well-being benefits A rising share of Gen Z consumption occasions in the pandemic era are motivated by the need for something healthy and nutritious (+3%). Plus, Gen Z's holistic and expanding approach to defining what is healthy is a notable development. The pandemic experience—characterized as a time of increased stress, anxiety and boredom—has further prompted Gen Z consumers to opt for healthy options that meet physical energy goals, while also seeking options that support emotional and mental well-being. Adapting shelf set to add functional options that aid in relaxation and anxiety relief is a considerable opportunity.

Meal solutions Ipsos Foodservice Monitor shows strong Gen Z traffic at foodservice, even in the midst of pandemic-driven channel declines. Expansion of foodservice or partnership growth will undoubtedly attract Gen Z shoppers. While homebound during the pandemic period, Gen Z meal preparers, most likely to dine alone, continue to look for easy solutions to aid with daily preparation rigors. Home habits have prompted more consumption of cereal, potato chips, vegetables, and chicken and rice, with fewer dining

occasions that include, cheese, granola bars, sandwiches, potatoes and burgers. Can C&G stakeholders develop a suite of solution-oriented meal options that could promote more fill-in and emergency trips? In addition to food type, consider pack size; format preferences like kits; and other easy preparation criteria as key to meeting needs.

Mobile, mobile, mobile Surrounded by information, technology and interactive devices, Gen Z demonstrates strong information gathering habits on mobile devices, with almost half of the segment reporting always or regularly researching food and beverages before deciding to buy. In addition, there’s opportunity to digitize in-store experiences (think micro-markets) to connect with Gen Z shoppers.

Alcohol habits As members of Gen Z cohort hit the legal drinking age, they will be a future force in the alcohol sector. The Ipsos ACT Canada daily consumption tracking shows that Gen Z adult drinking habits have not decreased due to the closure of restaurants and bars, but have moved home. Gen Z adults are not drinking less, they are drinking differently, which provides considerable opportunity to develop relevant product mixes and pairing promotions to spur visits. Overall, Gen Z is more pragmatic, practical and socially conscious than the predecessor generation. In turn, key players in the C&G sector will need to recognize that there are unique differences between Gen Z and their millennial counterparts. Rather than targeting them as one broad segment, craft offers that appeal to their unique needs and desires, particularly as the "new kids on the block" shape up to be the next influential generation. ◗ Kathy Perrotta is a vice-president with Ipsos Market Strategy and Understanding, working with the Food & Beverage Group Syndicated Services. Data sources within this group include, Ipsos FIVE and Foodservice Monitor (FSM).

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Star Women in Convenience Awards Event

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Join us Honour the 2021 Star Women in Convenience during an industry-wide celebration.

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BACKTALK

BY MICHELLE WARREN

Teachable moments RYERSON UNIVERSITY'S JANICE RUDKOWSKI ON CATEGORY MANAGEMENT AND THE EVOLUTION OF CONVENIENCE Janice Rudkowski is an assistant professor with Ted Rogers School of Retail Management at Ryerson University where she focuses on buying and merchandising, category management and innovations in retail. She developed and designed Retailer Perspectives in Category Management, the first undergraduate course in Canada with curriculum certified by the Category Management Association. As part of her vision, students partner with Petro-Canada, Red Bull Canada, Field Agent and NielsenIQ to examine current issues in the convenience and gas channel. CSNC editor Michelle Warren spoke with Rudkowski about category management and the evolution of convenience.

Tell me about the Category Management course at Ryerson University, and why you decided to focus on the convenience sector. JR: I thought it was a great opportunity for the School of Retail Management to differentiate itself. When I got the course curriculum certified by the Category Management Association, I realized I needed industry partners so that I could have the students working on real projects. I reached out to somebody I knew at Red Bull and they said their biggest market is the convenience channel. I became really fascinated with this because, when I looked across our retail management curriculum, we didn’t have anything focusing on convenience and it’s such a big channel. I reached out to Leslie Gordon at Petro-Canada, who was totally excited about this idea of working together. It started with the right people being really passionate about lending their expertise.

You launched this unique experiential learning course in 2018, what have you observed about the convenience channel since then? JR: It’s really been fascinating to focus in on convenience and one of the challenges that 32

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we’ve given the students is to consider the blurring of the channel with a project called “Channel Blurring and Changing Consumer Behaviours in the Beverage Aisle.” It’s an interesting issue that every channel is experiencing because of shopper behaviour. Shoppers aren’t necessarily tied or really care about where they buy, for example, a beverage. They just want to be in a place that’s convenient for them. So if they’re waiting in line at Winners and they see that there’s a fridge full of Red Bull, they’re not going to say, “oh, but this isn’t right”—it doesn’t matter to them, they’re going to buy the product.

When it comes to in-store experiences, so much has changed in the last year: How is this shifting and shaping convenience? JR: A lot has been driven by regulations in terms of which stores can open and how many people are allowed in the store. That’s changed shopper behaviour—there is less browsing and more, “I have a list I have to get out of here fast,” which really affects that customer journey and shopper experience. There’s not as much opportunity for entertainment anymore. The shopper doesn’t necessarily want to be entertained in the same way because they’re

thinking, “I need to get what I want and get out of this store.” Some of my research delves into how that convenience store customer journey is really changing.

What trends do you see and how are they shaping category management? JR: I certainly think the relationship has changed. There is some recent research that shows just as smaller establishments had started to grow, we had the pandemic and shoppers were looking for more one-stop shop opportunities because they don’t want to have to shop in multiple stores. That definitely challenged the convenience channel. With convenience, the challenge is picking just the right assortment and it really has to fit what the catchment area needs. Assortment needs to be rethought. First, it was what are the must-have items during the pandemic? But now it’s shifting again—there’s a lot of exciting things happening in convenience. The big players are using technology and data to make decisions and innovate. The convenience chains have the capacity and the resources to leverage the data and category management really relies on data. If you’re able to understand your performance versus the market, you’re much better able to manage change. CCentral.ca

What would you recommend to independents, who don’t necessarily have access to large amounts of data? What can they do to make decisions in a more informed way? JR: You’re right, a small or independent retailer is going to have their own internal POS, but they’re not going to have marketplace data when making pricing or promotion decisions. However, one of the advantages that the independents have over the chains is building one-to-one relationships: They can use data from the conversations they have with customers to help inform their assortments. One thing that is really interesting that independents do is that they often collaborate with other independents to increase their buying power. When you create a group there’s an opportunity to start to share data. When you can gather more data points, you then have an opportunity to get a better lay of the land and make better decisions.

How do you see the convenience channel evolving? JR: Independent operators still make up the bulk of the business, but that’s shifting. I live in Midtown Toronto and our convenience stores are such an integral part of the main street shopping area that provides so much vitality to a community. With independents, there’s this idea that they’re stuck in the past, that the stores are a bit tired, but you have a lot of really interesting players coming in and turning the whole idea of a convenience

store on its head and doing completely different innovative things. It speaks to the blurring of the channels and even questioning what is a convenience store? My local butcher shop is a very small store, but it’s super modern and very cool looking and they’ve brought in all sorts of pantry items and they sell fresh bread, as well as a very curated assortment of fruits, vegetables and dairy. Are they a convenience store? People go in there and just pick up snacks. Their assortment represents things that regular convenience stores have, except that their brands are perhaps higher end.

They don’t have lottery and tobacco, which some would consider to be defining categories for conveniences stores—does that matter? JR: It’s an interesting opportunity to rethink what convenience is. Every channel in retail right now is rethinking their identity because shopping behaviours are changing so quickly. The term convenience comes up in terms of one of the top needs of every shopper across every shopping experience, but we also have this whole channel called convenience. If everyone is trying to deliver convenience, what is the role that convenience plays? There are those defining categories, like lottery and tobacco, but then there are also so many other categories that have relevance, like beverages. Each of those categories shifts with changing consumer trends—a few years ago it was water, then it was ice tea and now it’s kombucha and RTD coffee.

JANICE RUDKOWSKI PHOTO COURTESY OF RYERSON UNIVERSITY

How does convenience stay relevant? JR: You can to an extent take a cookie cutter approach, but

whenever it comes to being a neighbourhood store, you really have to know your people and what they’re after. That’s where the mom and pop convenience stores are so progressive. At my local convenience store, they know me and there are certain things that I like to buy there. He’ll say, “Come back on Tuesday. I promise I’ll have your lactose-free milk.” That’s powerful—building this type of relationship is really where the independents have that edge. ◗

How are you responding to shifting consumer behaviours and rethinking category management to future-proof your business? We want to hear about it! Email editor Michelle Warren: mwarren@ensembleiq.com

*This interview is edited for clarity and length.

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