Octane - Jan 2018

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The Convenience

U CARWACS Show TORONTO March 5-6

CANADA’S CAR WASH & PETROLEUM MAGAZINE

&TRENDS

INNOVATIONS PM42940023 • $12.00 CCentral.ca @CCentral360 January / February 2019

Also inside A beam that beacons LED leads the way

Flat deck conveyors enhance capability

Apps add ease to wash sites

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PROTECTING THE ENVIRONMENT

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January / February 2019

TM

Volume 24 | Number 1

CANADA’S CAR WASH & PETROLEUM MAGAZINE

15

19

12 ADVERTISERS Aerodry Systems, LLC.....................................17 AIR-serv Canada Inc....................................... 22 Blendco Systems LLC.....................................20 Dover Fueling Solutions....................................6 Forte Products................................................ 10 Furever Clean Dog Wash................................ 10 Greenergy Fuels Canada Inc ............................4 Innovative Control Systems............................ 14 Mondo Products Co. Ltd..................................2 Mosmatic Canada Inc..................................... 10 Oasis Car Wash Systems...........................21, 23 Pumps & Pressure Inc..................................... 10 PurClean-PurWater......................................... 16 WashLinks/Sonnys.........................................20 World Fuel Services Canada, ULC....................9 Zep Vehicle Care, Inc.......................................18

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CONTENTS 05 Editor’s Message Innovation leads to appreciation

12 A beam that beacons LED leads the way

07 There's an App for that!

It’s never been easier to manage customers and wash sites

15 On deck Flat deck conveyors enhance capability

08 Opinion Retail fuel brands in the Canadian market: trends and observations

19 COVER STORY Innovation & Trends Change pushes market innovation

11 Show time!

Convenience U CARWACS spotlights industry best practices

24 CCA Industry Forum Wash volume report Results available for Q3

January / February 2019

|3

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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 PRESidENT, ENSEMblEiQ CANAdA Jennifer Litterick | jlitterick@ensembleiq.com Group Brand Director - Retail Kathryn Swan | kswan@ensembleiq.com ViCE PRESidENT/GENERAl MANAGER - EVENTS Michael Cronin | mcronin@ensembleiq.com Editorial EdiTOR, CSNEWS CANAdA Jane Auster | jauster@ensembleiq.com EdiTOR, Octane Kelly Gray | kgray@ensembleiq.com ONLINE EDITOR Nikki Lockington | nlockington@ensembleiq.com TRANSLATION | Danielle Hart advErtising salEs SALES REPRESENTATIVE Elijah Hoffman | ehoffman@ensembleiq.com SAlES & EVENTS COORdiNATOR Claudia Castro DESIGN AND production Vice President, Production Derek Estey | destey@ensembleiq.com PRODUCTION MANAGER Michael Kimpton | mkimpton@ensembleiq.com ART DIRECTOR | Christian Lemay

Director of Marketing Alexandra Voulu | avoulu@ensembleiq.com AUDIENCE DEVELOPMENT MANAGER Lina Trunina | ltrunina@ensembleiq.com WEB OPERATIONS MANAGER Valerie White | vwhite@ensembleiq.com CORPORATE OFFICERS EXECUTIVE CHAIRMAN | Alan Glass

ChiEF EXECUTIVE OFFiCER | David Shanker Chief Financial Officer | Dan McCarthy CHIEF DIGITAL OFFICER | Joel Hughes

Chief Innovation Officer | Tanner Van Dusen Executive Vice President, Events & Conferences Ed Several

SUBSCRIPtion services Subscriptions: $65.00 per year, 2 year $120.00, Outside Canada $100.00 per year, Single copy $12.00, Groups $46.00, Outside Canada Single copy $16.00.

Email: ycm@convenienceu.ca Phone: 1-844-694-4422, between 9 a.m. to 5 p.m. EST weekdays Fax: 1-844-815-0700 / Online: www.ccentral.ca/subscribe

Innovation leads to appreciation When most people think about innovation thoughts turn to machines, systems and technology. What about the basics of service that are the foundations of car wash and fueling sites? Here are four simple suggestions for taking full-service to new places.

Get some umbrellas – When the weather is bad fuel customers often turn to full-service sites. Let customers know you care by having umbrellas pump-side if they have to run into the c-store or use the bathroom when it’s pouring outside.

Have your forecourt crew ask at the car window if customers would enjoy a coffee or tea. During cold days this hospitality speaks volumes about your business.

Spend time building your forecourt full-service offering and take it beyond just a fill and a window wipe. A typical fill takes between three and five minutes. Use this time to have staff check tires and give them a wipe with Armor All. If tires need air, be willing to assist with a ready pressure gauge and directions to the air hose. Ask to do a quick check of signal lights and let customers know if there is a problem. This last point works for full-service car wash locations as well. Have staff do a quick tire and lighting check at final wipe down.

Clean the bathroom! Make your site the one people want to come to. A clean restroom is a tremendous marketing point and one that can really differentiate one business from another. A clean bathroom says respect to customers and it tells the world you are serious about service.

Service innovation is something that helps get sites away from the chase to the lowest price.

Forget the pennies and deliver the gold standard of service to customers by innovating at every point of contact.

LICENSING AND REPRINTS 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. ©2019 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.

kgray@ensembleiq.com

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GROWN E25 STANDARD Wayne Ovation™ fuel dispenser

w w w. w a y n e . c o m © 2018 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.122018v4

There’s

app that!

an

for

It’s never been easier to manage customers and wash sites Text by Kelly Gray

The recent Technology Study from our US-based sister publication CSNews reports almost 47% of US convenience and gas retailers state they use a mobile app to interact with customers and tell them about their services, prices and specials. This number is up about 5% over last year.

“The benefits of having a mobile app are huge,” says Mike Black, managing partner with Valet Car Wash, a 10-unit chain based in Ont. Valet has one of Canada’s best digital portals. Developed in-house, the Valet app tells users the nearest location, types of service available and cost. Promotions and special offers are built in to make the app a good value equation for customers. Credit card data and personal profile are stored on the app, making it as easy as a one-button selection. Once payment is made, all customers have to do is show up and enter the code (sent to their phone) into the pay terminal to receive a wash. Users earn points when purchasing washes, which can later be redeemed for free services.

It goes without saying that the major oil companies and leading local operators currently look to some form of app to offer wash sales, loyalty promotions as well as connection to their community. With this digital software, customers can collect reward points and manage monthly subscriptions as well as receive marketing messages.

However, these apps often go well beyond the needs of the customer. For example, one prominent manufacturer offers an integrated point-of-sale and marketing system designed to create a total car wash solution.

CCentral.ca

This app connects with car wash controllers, is Cloud-based, and manages targeted email campaigns. It does all this via smartphone with operators able to view reports, change accounts and invoices, and track staffing. Got a door problem? Apps such as these tell operators doors are jammed or stuck open. The same type of app also lets operators know when chemical levels are getting low or effluent levels are high.

These car wash and gas station apps began making an appearance in the market about nine years ago. Now, the rise in digital apps for car wash is all part of the Internet of Things (IoT) with controllers able to interface easily with mobile app, SMS, Call and API (Application Programming Interface). “There is a tremendous evolution happening now with digital capability,” says Brad Bossert, director of sales and marketing, Bulloch Technologies, a

leader in gas station POS control systems.

“Key to success is privacy and security of customer data and the overall efficacy of the programs. Coming over the next decade, cars will be the mobile payment device. Forget having to even pull out your smartphone to access a wash site or gas station app program. The car will recognize the site and bring the necessary app down from the Cloud. It will all be very seamless,” he concludes. OCTANE

Does your company have a mobile app for consumers?

Yes

2018 2017 46.2% 41.4%

Mobile app features Store locator

100%

100%

Fuel prices

62.9%

58.8%

Coupons

61.7% 57.6%

Limited-time offers

54.1%

Customer feedback

53.0%

53.4%

Loyalty tie-in

49.7%

52.3%

Games

54.5%

27.5% 18.2% January / February 2019

*(Source CSNews, 2018 Technology Study)

|7

Opinion

Retail fuel brands in the Canadian market: trends and observations

Jason Parent, Vice-president, Consulting, Kent Group Limited

8

|

may be owned and operated by other comAn established fuel brand can have significant panies, they continue to operate under their value for a station operator by offering enhanced refiner-owned brand and would otherwise be brand recognition and the perception of fuel indistinguishable to the consumer. quality. And, established marquees often bring with them ongoing marketing support from the Over the last 15 years, independent fuel brand owner. Not surprisingly, the representamarketers – those not involved in the refining tion of major chain brands (such as Esso, Shell, of gasoline – have expanded their presence in Petro-Canada, or other regional refiner-owned the Canadian retail fuels market, increasing brands) in the Canadian retail fuel market has from 44 per cent of sites in 2004 to roughly grown over the last 15 years. According to Kent 60 per cent of sites in 2017. Over this time, Group’s annual Retail Site Census, nearly 40 per the percentage of these non-refiner marketed cent of Canadian gas stations sold gasoline using sites operating under a refiner-owned brand has one of the “Big Three” national gasoline brands grown from just 11 per cent of all Canadian (Esso, Shell, and Petro-Canada), and many more sites in 2004 to nearly 40 per cent of all sites in operated under smaller yet established regional 2017. refiner-owned brands. HowMost of the non-refiever, there are aspects of this ner marketers’ use of the trend away from independent refiner-owned brands has An established fuel or non-refiner brands towards occurred in the controlled brand can have refiner-branded offerings that portion of their network, are often misunderstood. significant value for as opposed to their Increasingly, the posted non-controlled (or indea station operator brand at a gas station is not pendently operated) sites, indicative of site management meaning these marketers or ownership; many established prefer to run their most valued assets under refiner-owned brands have chosen to divest these established brands. This trend is likely to part or all of their retail networks and to simply continue as the perceived value of these brands maintain a brand presence through third-party has shown to have a significant impact on site arrangements. The number of gas stations selling performance. According to Kent’s site perforunder a brand that is owned by another organimance data, the average 2017 sales volumes for zation has increased significantly, from just 5 per sites operating under a refiner-owned brand was cent of Canadian stations in 2004 to 37 per cent 13 per cent higher than all other sites. of stations in 2017.

There is little that indicates these trends are As the presence of refiner-owned brands likely to change. Despite the continued developincreased over the last 15 years, the percentage ment of independent brands, there have been of those sites operated by those same refiners recent moves to either expand the presence of rehas fallen dramatically. In 2004, 89 per cent of finer-owned brands within existing independent sites operating under a refiner-owned brand were networks (McDougall’s recent announcement operated by that same refiner, but in 2017 that of a branded supply agreement with Husky), or had fallen to just 23 percent of those sites. to introduce new refiner-owned brands, as seen with the introduction of Mobil into Canada. It In Canada, this trend has accelerated over is clear that brand matters: given the strong perthe last five years. Imperial Oil sold all of their formance of stations operating under established remaining retail assets to independent markerefiner-owned brands, these brands are expecters in 2016, meanwhile Shell Canada divested ted to maintain their presence in the Canadian most of its retail operations in Quebec and market, even if many will be operated within the Atlantic Canada to a regional fuel marketer and grocery chain (Sobeys). While these sites networks of independent marketers. OCTANE

January / February 2019

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Show time!

Convenience U CARWACS spotlights industry best practices This coming March 5-6, 2019 the Toronto Congress Centre will host another Convenience U CARWACS Show, Canada’s leading trade event for forecourt, car wash and c-stores. Will you be there?

The Toronto Convenience U CARWACS Show has been a must-attend date on the industry’s spring calendar for years. Reasons are many, but leading the list is the show’s ability to deliver the widest collection of suppliers and services to the trade in one place and at one time.

Organizers have built an event that offers everything from insightful education sessions, to networking opportunities and fun experiences, to an energy-packed trade show floor. Here is a slate of some of what attendees to the car wash/petroleum side can expect this year:

Tuesday, March 5:

Wednesday, March 6:

The day opens with Ask an operator!

– Industry panel for carwash operators. Running from 9:00 a.m. to 10:30 a.m., the Canadian Carwash Association (CCA)-sponsored event features an interactive discussion of key trends, issues and challenges facing car wash businesses today. Learn where the industry is going and what can be done to stay ahead of the competition.

The day begins with a coach tour of southern Ontario’s leading car wash sites. Be on hand at the Toronto Congress Centre at 8:30 a.m. to board buses for the morning tour. Expect a rich experience filled with sites showing off new equipment, innovative programs and cutting edge service. This event often provides some of the best takeaways from the show. Buses arrive back at the Toronto Congress Centre for a noon CCA-hosted luncheon.

Also on Tuesday is the Canadian Carwash Association’s annual general meeting. Held at 11:00 a.m., the gathering will feature a keynote speaker as well as lunch. All members in good standing of the CCA as well as non-members are invited to pre-register to attend.

See you at the show!

CCentral.ca

The trade show floor opens each day at noon and reflects the best of the industry with a who’s who of suppliers. Expect to find the biggest names in the business as well as a raft of new vendors who come together to create tremendous opportunities for attendees. The Convenience U CARWACS Show is the place for discoveries, networking and deals that can take your business to the next level. OCTANE

A beam that beacons | LED leads the way

Text by Talbot Boggs

High-quality, efficient lighting of pumps, car washes, parking lots, perimeters, signage and interiors is a vital component of business today and key to improving customer satisfaction and safety. Stations and convenience stores across the country are almost universally switching from old halogen to LED (Light Emitting Diode) lighting in new-build or through upgrades to older locations.

“There is a big shift in the industry now toward LED lighting because of the cost, operational and customer and staff advantages,” says Jim Rodd, sales manager with Red Leonard Associates. “It’s almost certainly a standard in newly-constructed sites and by now most of the major companies like Canadian Tire and others have done, or are doing, upgrades across their locations.”

LED lighting in the forecourt has numerous advantages. Perhaps first and

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January / February 2019

foremost is energy efficiency. Operators report they have seen savings as much as 66 per cent when municipal rebate programs are taken into account.

Longevity is another major advantage.

“LED lighting in the forecourt uses less than 10 per cent of the energy than the old metal halide bulbs consumed and is a far better light,” says Tom Humphries, petro operations manager with Peninsula Cooperative in Victoria, BC. “You can expect to get longevity of 100,000

Better lighting in the forecourt makes the site more inviting for all customers, especially females who often look for a safe, well-lit environment

CCentral.ca

You can expect to get longevity of 100,000 hours or 15 to 17 years before you need to change any bulbs.

Other advantages are fewer operational disruptions when forecourt bulbs need to be changed and no service calls.

hours or 15 to 17 years before you need to change any bulbs. Other advantages are fewer operational disruptions when forecourt bulbs need to be changed and no service calls.”

Red River Cooperative, which operates more than 30 locations in Manitoba and some across the border in Ontario, has a local sign contractor come to its sites once every three months in the summer and once every two months in the winter to check bulbs and replace them when necessary. “With LED technology this maintenance and the additional cost is not required,” says Randy Andrusiak, gas bar operations manager with Red River.

“From our experience the only item in an LED system that can fail is the driver, but very few have failed us over the last five years.” (An LED driver is an electrical device which regulates the power to an LED bulb or string or strings of LEDs. The driver responds to the changing needs of the bulb or circuit by providing a constant quantity of power as the LED electrical properties change with temperature).

As well, it gives more direct light than older technologies and reduces light pollution in the dark hours, a great advantage if the station is near a residential area.

“The benefit is a gas bar that is bright in appearance and reassuring to customers that the site is safe,” says Andrusiak.

Red River Cooperative is in the process of upgrading its locations with LED technology at the same time as it is upgrading its exterior corporate identification. Humphries suggests operators upgrade to LED all at once. “Mixing old lighting with new LEDs is a bad idea and it’s typically better to do the whole thing in one stroke,” he advises. “The cost will obviously depend on the size and scope of the upgrade, but either way the investment payback of switching to LED is quick at one to two years.”

Once the forecourt is completed, Humphries recommends changing the instore lighting as well. “LED tubes versus the standard eight-foot fluorescents again will consume only less than 10 per cent of the energy and provide much better retail lighting,” he says suggesting operators learn about local regulations and rebate programs.

Better lighting adds up to better operations and potentially better revenues and profits as well. Simply, switching to LED will provide premium lighting, conserve energy, reduce inconvenient and costly maintenance and reduce overall costs as well as create a more inviting and secure environment. OCTANE

Another advantage is that the light from LED is much better than from old halogen systems. “Better lighting in the forecourt makes the site more inviting for all customers, especially females who often look for a safe, well-lit environment,” says Humphries. “Staff also work much better and safer under good lighting conditions.

We use LED bulbs that are 3200 K (kelvin) on the lighting spectrum which we feel give us the optimum lighting for a forecourt.”

The kelvin number will determine the kind of light an LED bulb will emit. A lower kelvin number means the light appears more yellow while a higher number means the light is whiter or bluer. LEDs at the 2700K to 3000K range will match the colour of an incandescent bulb. If you prefer a whiter light, look for bulbs rated between 3500K and 4100K. Another advantage of LED lighting is that it is instantaneous. When an LED light turns on there is no warm-up period.

CCentral.ca

January / February 2019

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Photography by Roger Yip

On deck Flat deck conveyors enhance capability Text by Kelly Gray

Flat deck conveyor technology has been making slow, steady gains in North America’s car wash sector for over a decade. Today, this technology is poised to take the industry forward with systems that increase throughput, enhance customer satisfaction and address the challenges of new automotive realities such as advanced driver-assist systems and low-hanging batteries.

The flat top belt conveyor is simple.

Essentially, it’s a platform that carries vehicles through the tunnel wash process.

The traditional method in use since the 1960s has been the chain and roller conveyor system where vehicles stop in neutral and are pulled through the tunnel by a roller contacting one of the vehicle tires. The advantages of the belt versus the traditional chain and roller conveyor are numerous: easy loading and unloading, no damage to tires or expensive rims, and the fact that belts are capable of handling just about any size vehicle.

Suncor’s Petro-Canada brand was an early adopter of belt conveyor systems with the introduction of its Glide Auto Wash product in 2006. Today, there are

CCentral.ca

35 Glide sites across Canada utilizing a belt conveyor to move vehicles through the tunnels. “Informal guest feedback on Glide has been positive,” says Petro-Canada spokesperson Nicole Fisher. “For many guests, the openness, simplicity and intuitiveness of the Glide conveyor eliminate concerns about lining up a vehicle within the confines of the traditional car wash conveyors.”

Now, industry leading operators such as Ontario’s AutoSpa have picked up the torch on this technology and are utilizing it to raise the bar on vehicle wash products such as high-volume hand detailing.

AutoSpa features multiple belt conveyors that allow them to offer complete detailing services along a 100-ft. belt length.

Teams of cleaning techs can process over 350 cars per day on a single belt.

“When it comes to wash quality perception, the traditional ingredients of clean, shiny and dry are still true today,” says Rob Stephenson, president of STI Conveyor Systems. “However, Millennials are demanding a better buying experience and belt conveyors help achieve this by offering an easy, stress-free way of bringing their car through the tunnel,” he says.

Wash operators can expect higher ticket prices and increased buying loyalty thanks to the enhanced customer experience, and greater throughput efficiency with more cars processed during peak hours with a belt conveyor.

January / February 2019

| 15

This technology is poised to take the industry forward with systems that increase throughput, enhance customer satisfaction and address the challenges of new automotive realities such as advanced driverassist systems and low-hanging batteries.

Flat deck success David Begin, past president with the International Car Wash Association (ICA) and the owner of Wild Blue Car Washes in Colorado, points to the success of Germany’s Mr. Wash, a chain with more than 30 locations and individual sites that clean over 500,000 cars a year. “Flat decks offer a huge increase in potential,” says Begin. “We saw Mr. Wash demonstrate this by showing a site where there was a chain conveyor in one tunnel and a flat deck in the other. The flat deck system was able to achieve a 20 per cent higher throughput,” he says.

"A big challenge in our industry is that there is not enough synergistic effort to have different equipment suppliers work together. There is room for improvement,” says Jan Van Kessel, vice-president international sales and technology development at Mondo-Products, a leading supplier to the trade. As an example, he points out that with older chain pull technology, tires rotate, making it easier for application of tire cleaners. With flat deck systems tires are stationary and require a different approach that utilizes sensors and equipment that spins to clean the tires.

“Accuracy in car wash is essential,” he says, noting that VFDs (variable frequency drive) can measure the number of rotations on the axel of the drive motor that can be a good starting point for deck conveyor system progress monitoring.

“Sensors can be added to identify the type of vehicle and let the system know the size and shape so that equipment can tailor applications of chemical and water to save money and enhance effectiveness,” he says.

Greater capability comes at a cost. Today, a belt conveyor system will cost about 2.5 times as much as a traditional chain and roller system. This translates into about five cents to six cents extra per car. Expectations from manufacturers suggest return on investment is close to 13 per cent after cap-

16

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January / February 2019

CCentral.ca

® TM

ital expenditure. However, says Begin, belt conveyor system cost is coming down as more operators adopt the technology.

Leaders in the industry include such well-known names as AVW, STI, MacNeil, and Wash Tec/MarkVII. Lawrence Stovall suggests the future will include more and more flat deck systems. Stovall is president and CEO of Auto Brite, a chemical and equipment distributor with lines such as Taiwan-based Chia-ma Car Wash Systems, a manufacturer that is a recent addition to the North American mix of companies offering flat deck technology. He reports that just now Chia-ma is working with Volkswagen to create the first attendant-free car wash site in Taiwan. “This flat deck site features modular construction with units built in the factory for rapid installation,” he says, commenting that this modular aspect can shave 20% or more off of construction times.

Retrofitting Retrofitting a chain and roller conveyor to a belt conveyor is an option that many tunnel operators are considering. The concrete work required to convert a 100-ft. tunnel runs about $40,000 to $50,000 and will require anywhere from two to four weeks of downtime to accomplish the work.

Traditionally, the maintenance required on belt conveyors can be significant. For example, dirt and grime from wash sites is hard on belts, drive sprockets and glide plates. Additionally, as with all types of car wash conveyors, corrosion significantly affects the amount of required maintenance.

Belt conveyors are unique in that almost all of the moving components are made from non-corrosive materials. This significantly reduces the monthly and yearly maintenance tasks for the conveyor.

“The conveyor system is the heart of the tunnel. It’s a mission critical piece of equipment that demands careful consideration if you want to keep business moving,” says Stephenson, noting that while belt conveyors are more expensive up front, they offer the potential for higher ticket prices, greater throughput and enhanced customer loyalty.

Concluding, Lawrence Stovall points out that operators need to be mindful of the fast pace of technology to reshape our world. He sees deck conveyors falling into this category. “By getting involved sooner rather than later with deck conveyors operators don’t have to play catch-up with technology as vehicle owners demand new time-saving options for a clean car.” OCTANE

CCentral.ca

January / February 2019

| 17

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COVER STORY

2019

Innovation

trends

Change pushes market innovation Text by Kelly Gray

Technology is a market disruptor as well as a service enabler. As we move into the next decade expect forecourt to undergo considerable change. Here are five trends that will shape the future of Canada’s forecourts:

1. Electric alternatives Canada now has more than 50,000 electric vehicles (EV) on the road, and this number is growing fast, making electrics the leader in alternative fuels by a wide margin. Last year the market for EV climbed 68% nationally and 128% in Ontario. Major petroleum operators are peddling hard to meet this market disruptor head on and the Canadian gov-

CCentral.ca

ernment is working with the private sector to get charging infrastructure up to speed.

For example, Natural Resources Canada (NRC) is working with Canadian Tire to install up to 20 new fast charge sites in Ontario. The Canadian Tire/NRC/ ATCO partnership is also working in Alberta where the team has completed the necessary charging infrastructure on the

highway between Edmonton and Calgary.

In Ontario and Manitoba, the federal government alongside partners eCAMION, a Toronto-based energy storage system developer, Leclanché, an energy storage provider, and Geneva-based power producer SGEM have installed 34 electric vehicle fast-charging stations along the Trans-Canada Highway in an attempt to

January / February 2019

| 19

encourage the adoption of zero-emission vehicles. The project is valued at $17.3 million and, says Elad Barak, VP business development of eCAMION,“This is perhaps the largest infrastructure project for electrical vehicles to be deployed at one time anywhere in the world.”

Among the first to deploy fast charging is G&G's Travel Plaza in Port Severn, Ont. Located on Highway 400 as it enters the community, G&G's Travel Plaza installed the first 50 kW DC fast charger in Canada in 2016 thanks to support from Electric Vehicle Chargers Ontario's (EVCO) grant program, which has been cancelled by the Ford government. G&G's Travel Plaza describes itself as a travel plaza with c-store, foodservice, full-service fuel and an EV charging system.

Globally, Shell is a leader with its Shell Recharge program offered in the UK. Shell Recharge provides 50 kW DC rapid chargers, systems that can charge most cars in about 30 minutes. While cars charge, customers are encouraged to pick up a drink or snack at Shell’s Select Shop and use Shell’s free WiFi. Customers in the UK pay for Shell Recharge by using the Smoov app, a subscription-free mobile payment system. There are no subscription or con-

G&G's Travel Plaza 50 kW DC fast charger installed in 2016, thanks to support from Electric Vehicle Chargers Ontario's (EVCO) grant program.

nection fees and customers pay only for the power used to recharge their cars.

2. Fuel efficiencies in cars As we move forward, vehicles will be using less and less of traditional petroleum products. Gas station operators will have to adapt to this change by offering alternative fuels and additional services.

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Gasoline consumption is projected to decrease in Canada by 8% from 2011 to 2025 despite an 11% population increase and more cars on the road. Fuel economy for light duty vehicles sold in Canada is projected to improve roughly 40% between 2011 and 2025 (NRC).

Gasoline consumption is projected to decrease in Canada by 8% from 2011 to 2025 despite an 11% population increase and more cars on the road.

Since 2011, Canada has been married to the United States’ fuel economy standards. The hope south of the border is that fleet-wide averages of fuel efficiency will reach 54.5 miles per (US) gallon by 2025. To get there, vehicle manufacturers are using lighter materials to reduce the weight of car components. This alone could deliver a 39% improvement in overall vehicle fuel efficiency. A further 13% improvement could come from an increase in use and an improvement in biofuel blending. Hybrid vehicles are another important consideration. Indeed, NRC reports that hybrids offer fuel savings and CO2 reductions of 20% to 40% over gasoline-only vehicles.

A recent Consumer Reports’ survey found that 37% of respondents said their leading consideration when shopping for their next car will be fuel economy. A distant second was quality (17% followed by safety (16%), Some two-thirds of owners surveyed said they expected their next vehicle to get better fuel mileage than the one they’re driving now.

3. Digital marketing with dispenser-tocar conversations The big news here is G5 wireless technology. It's believed that by 2020 there will be 250 million digitally connected vehicles on the road. To make this happen wireless needs a boost from its current 4G spectrum so that cars and devices can all play nice together in an expanded ‘Internet of things’. Just now, the US Federal Communications Commission (FCC) announced its auction of G5 spectrum space.

Europe is also getting its G5 ducks in a row with its current discussions on Cooperative Intelligent Transport Systems (C-ITS) for autonomous vehicles.

It's believed that by 2020 there will be 250 million digitally connected vehicles on the road.

CCentral.ca

Visa and Honda have announced they are working with partners such as Gilbarco Veeder Root to create a seamless car payment tool that allows fuel dispensers to recognize a vehicle, turn on the pumps and take payment without drivers having to reach for wallets. The car does it all. Just fuel up and drive away.

The Visa-embedded Honda could also pay for parking, a car wash, drive-thru at foodservice, or accept offers from the fuel site’s c-store. And, while it's important that drivers not be burdened with too much marketing while they are supposed to be paying attention to the road, a car’s digital signature is ideal for loyalty programs. Indeed, only last week, retailers The Gap and Sephora utilized my iPhone’s location tool to send marketing messages as I approached a major shopping centre in the car. In the future this message would appear on the dash console. (A scary thought!)

4. Car sharing Alternatives to traditional car purchase such as car and ride sharing will mean less need for fueling. People will use cars only as needed and look to other forms of transport for short hauls. Already, car sharing is becoming a major force in Canada’s large cities.

One example is car2go, the German car rental company owned by Daim-

ler AG. Car2go is the world’s largest car-sharing company with 2.5 million registered members and a fleet of nearly 15,000 vehicles in locations in North America, Europe and Asia. Users are charged by the minute, the hour or the day. The service forgoes the traditional rental office. Cars are user-accessed wherever they are parked via a downloadable smartphone app.

Already Land Rover and Jaguar products (outside North America) offer the ability to pay for purchases through an on-board ApplePay wallet. Once G5 rolls out broadly, this type of transaction will become standard.

AirServ_CSN_Can_HalfPage_0118.pdf

C

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CJ

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2017-12-22

18:10

COAST TO COAST NATIONAL SERVICE

COVERAGE Serving the Canadian Retail Petroleum/Convenience Industry for 35 Years Truly National Service Coverage with direct AIR-serv Technicians from Prince Rupert to Fort McMurray to St.John’s. We service all of Canada!

We provide over 100,000 service visits annually to our customers Safety first culture resulting in an immaculate Safety Record We Enhance Customer Satisfaction with the Convenience of “Tap N Go” Our Total Service Program is a no cost service program giving you comprehensive reporting from Installation to Service to Revenue to Safety

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5. Gas comes to you With greater connectivity comes greater service. Shell has just introduced Shell TapUp to the Houston area in the US south.

The program delivers gas to customers where their vehicle is located. Shell is the US leader in retail fueling (30% marketshare) and they are looking at ways to combat declining sales.

ExxonMobil is investing in start-up company Yoshi, a ‘concierge’ fueling service that is now in 16 US cities. Customers pay a $20 monthly subscription to the service and then pay for the tank of gas (fuel cost is an average of the prices in a metropolitan area). Services such as this are ideal for fuel desert cities such as Vancouver where availability to city centre fueling is poor. It's also great for time-starved people who find value in having gas delivered to their cars while they work or sleep. OCTANE

CANADIAN CANADIAN

CARWASH CARWASH ASSOCIATION ASSOCIATION Directors Christopher armena – Brad Baldwin – Mike Dietrich –

parklanD Fuel CorporatIon

terry Fahey –

Crosstown Car washes

Fahey eleCtrIC/CapItal

wash systeMs

Brad Goetz –

Wash Volume RepoRt ›Results aVailable foR Q3

Mark VII

Zep VehICle Care InC.

Domenic DiMonte –

MonDo proDuCts Co. ltD.

alex Grieve – jason kaye –

january 2019

Valet Car wash

BayVIew Car wash ltD.

sean McBride –

CleanInG systeMs InC.

kirsten Vaive –

Carwash ConneCt

rudy van woerkom –

BIG CIty

auto n truCk wash

Mark Vella –

7-eleVen

NATIONAL OFFICE Finance Director Karen Dalton cae operations Director Kiki cloutier Manager Membership elizabeth Tang

t

he Canadian Carwash Association has just released the 2018 third quarter results of the Wash Volume Report (WVR) reporting that average revenue per site was down 7.2% at $55,710 compared to $60,037 in the third quarter of 2017. The average cycles per site was down 12.9% at $5,994 compared to 6,881 for the quarter in the previous year.

The average revenue per cycle was up 6.5% at $9.29.

Undertaken for the CCA by Kent Group Ltd., a research firm specializing in the gas station and car wash industry, the WVR is a national quarterly survey of 845 carwash sites across Canada. Members of the CCA may participate in the WVR program and receive results specific to their regional at no extra cost beyond their membership fee. All CCA members can access the full national and AVERAGE REVENUE PER CYCLE provincial 2018 results on the CCA website. Also available online is information on how you can add your carwash site to the WVR at http://www.canadiancarwash. http://www.canadiancarwash.ca/wvr. ca/wvr. $11.00

$10.00 $9.00 $8.00 $7.00 $6.00

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January / February 2019

18

18

18

20

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$55,710

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$45,710

$56,268

$75,906

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$48,567

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$45,442

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13

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10,857

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8,838

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5,478 5,956

5,639 5,665

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4,000 2,000

18

18

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on the CCA website has close to a thousand member sites on it.

Is your carwash listed?

Member sites are listed for free, so contact office@canadiancarwash.ca for more information.

12,000

Q1

canadiancarwash.ca/search http://canadiancarwash.ca/search

20

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Q1

AVERAGE CYCLES PER SITE

› The carwash search feaTure ‹

20

CaRWaSH

13

www.canadiancarwash.ca

Q3

office@canadiancarwash.ca

$47,559

$65,043

tel: 416.239.0339 Fax: 416.239.1076

Find a

Q3

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14

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AVERAGE REVENUE PER SITE

toronto, on M6s 2e4

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Q1

Canadian Carwash association

20

13

$5.00

CCentral.ca

INDUSTRY FORUM INDUSTRY FORUM De DIcaTeD TO sharING KNOwLeDGe aND BesT PracTIces IN The carwash INDusTrY

JoiN us at CaRWaCs foR semiNaRs aNd site touR PLAN NOW TO ATTEND CaRWaCs toRoNto TAKING PLACE maRCh 5-6, 2019 AT THE TORONTO CONGRESS CENTRE.

›› ask aN opeRatoR! – iNdustRy paNel foR CaRWash opeRatoRs 9:00 – 10:30 am Want to be at the forefront of the carwash industry? Join Canadian Carwash Association (CCA) Operator Members as they discuss the key trends, issues and challenges facing carwash businesses today. Learn where the industry is going and what can be done to keep ahead of the competition. This session will be interactive, and attendees will be encouraged to ask questions of the panelists. ›› CCa aNNual geNeRal meetiNg, keyNote speakeR aNd luNCheoN 11:00 am – 12:30 pm The Canadian Carwash Association (CCA) will be hosting the association’s annual general meeting on Tuesday, March 5th, 2019. This year’s AGM will feature a keynote speaker as well as a luncheon immediately following. Members in good standing are entitled to vote during the AGM and we encourage non-members to attend this event as well. Pre-registration is required, there will be no on-site registration for this session. More information is available at http://canadiancarwash.ca/agm.aspx. ›› CaRWaCs CaRWash site touR Hosted by the Canadian Carwash Association (CCA), the fourth annual CARWACS Carwash Tour will take place in Ontario on Wednesday, March 6, 2019. The tour will visit a number of CCA member carwash sites across southern Ontario as carwash operators enjoy a morning of networking, lunch and interactive site tours.

Buses depart at 8:30 AM from the Toronto Congress Centre and return to the Toronto Congress Centre for the CCA hosted Luncheon. Full details are available at http://toronto.convenienceu.ca/

CCa/Cfib beNefits: buildiNg a suCCessioN plaN: seVeN thiNgs to CoNsideR WheN plaNNiNg youR futuRe It might seem like there’s never a good time to plan for the future, but many of the hassles that demand your attention now are not so important in the long run. Take the time to ask yourself where you would like to see your business in one, two, or five years. As one person said, don’t let the urgent throw out the important. You may want to sell to others or see a family member take over. You may have no relative who is interested but have employees who would jump at the chance to own the business. Whatever the future CCentral.ca

holds for your business, it’s never too early to start making plans.

Creating a succession plan is a slow-burning process that encourages you to analyze all aspects of the business (and your life as the owner) and come up with the best option to ensure the continuance of your hard work – and the opportunity for you to enjoy the fruits of your many years of labour.

Here are seven things to ponder when planning your succession. https://www.cfib-fcei.ca/en/toolsresources/succession-plan

2018

NeW CCa membeRs

The Canadian Carwash Association welcomed the following companies as new members in 2018. These 30 companies joined more than 800 other carwash operators and suppliers that are members of CCA. The Boston Consulting Group, Boston, MA • 1844889 AB Ltd O/A Mudders Wash, Red Deer, AB • Cleaning Systems Inc., DePere, WI • Enova Consultants Calgary, Calgary, AB • Petro V Plus Car Wash, Etobicoke, ON • Daniel Cairns, Vancouver, BC • Minerva Kraushar, Calgary, AB • Queensway West Carwash, Ottawa, ON • Bluegrass Enterprises, Winnipeg, MB • Chad Martin Construction Ltd, Brandon, MB • Clean and Green, Oakville, ON • Dr. Jeffrey Sheppard, Saint John, NB • Ruby Brar, Calgary, AB • Wash Pros Inc., Edmonton, AB • JSR Holdings Inc., Baie Verte, NL • O/A Woodstock Car Wash, Ingersoll, ON • Splash ‘n Shine, Sechelt, BC • 7-Eleven Canada Inc., Surrey, BC • 621076 n.b. ltd., Blackville, NB • Don Mills Car Wash Ltd., Toronto, ON • Gwynn Curran-Sills, Dundas, ON • Dwarka Plumging and Drain Services Ltd., Scarborough, ON • 1728333 Ontario Inc, Oro Medonte, ON • Dreams Eco Xpress Car Wash, Okotoks, AB • Da-Lee Environmental Services, Stoney Creek, ON • Galaxy Car and Pet Wash, Stratford, ON • Strategic Group, Calgary, AB • Plains City Wash Stop, Portage La Prairie, MB • Grant Gulledge, Collingwood, ON • Federated Co-operatives Limited, Saskatoon, SK.

| 25

CANADIAN CARWASH ASSOCIATION CANADIAN CARWASH ASSOCIATION

January / February 2019

Warning

Brand name

Pictorial health warning

UPC code

Quantity

PLAIN PM42940023

Are you ready?

PACKAGING Also inside

January / february 2019 CCentral.ca @CCentral360

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It’s the vape that brings everything together. Satisfying the expectations of our customers, and proving the perfect partner for your business.

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Magnetic pods, magnetic charging simply clicking into place – for effortless, flavourful vaping.

PERFORMANCE

Strong battery performance delivering high-quality e-liquid.

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THE CLICK YOU HEAR. THE CLICK YOU FEEL. Logic Compact's magnetic e-liquid pod clicks into place. It's the same for the mouthpiece too, fresh every time it's replaced. That’s smart.

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CONTACT YOUR FERRERO SALES REPRESENTATIVE OR WHOLESALE REPRESENTATIVE FOR MORE INFORMATION

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covered te a l o c o h c e Whit ooth milky m s h it w s r e waf ing hazelnut fill (60 count) Contact your Ferrero Sales Representative or Wholesale Representative for more information

Tobacco advertising is not available in the digital issue

January / February 2019 Volume 2 | Number 1

Plain packaging 24

12 19

ADVERTISERS

CONTENTS

CCentral.ca.................................................... 15*

07 Editor’s Message Is this your year of reinvention?

12 Marché G. Lalime features Montrealers' favourites

33 Category Check Sweet! C-stores are candy central

08 The Buzz People, places, news and events

19 The big Snacko attacko Canada’s deliveryonly convenience store

35 Snapshot H2O to go Water sales increasing

Convenience U CARWACS Show - Toronto...32 EnsembleIQ......................................................31 Ferrero.........................................................2 & 3 ITWAL Ltd.......................................................34 JTI-Macdonald Corp...... Cover door, 4, 15*, 18* Monday Retail IQ...........................................18* Mondelez Canada Inc......................................21 Regal Confections....................................... 6, 27 Scandinavian Tobacco Group Canada............17 Star Women in Convenience..........................28 Tyson Foods, Inc.............................................23

10 Quick Bites Second sight... or just second guessing?

24 COVER STORY Plain Packaging Are you ready?

36 Backtalk 6 questions for Jan Westcott, President & CEO of Spirits Canada

*Regional only

CCentral.ca

January / February 2019

|

|5

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 PRESidENT, ENSEMblEiQ CANAdA Jennifer Litterick | jlitterick@ensembleiq.com Group Brand Director - Retail Kathryn Swan | kswan@ensembleiq.com ViCE PRESidENT/GENERAl MANAGER - EVENTS Michael Cronin | mcronin@ensembleiq.com Editorial EdiTOR, CSNEWS CANAdA Jane Auster | jauster@ensembleiq.com EdiTOR, Octane Kelly Gray | kgray@ensembleiq.com ONLINE EDITOR Nikki Lockington | nlockington@ensembleiq.com TRANSLATION | Danielle Hart advErtising salEs SALES REPRESENTATIVE Elijah Hoffman | ehoffman@ensembleiq.com SAlES & EVENTS COORdiNATOR Claudia Castro DESIGN AND production Vice President, Production Derek Estey | destey@ensembleiq.com

Is this your year of reinvention?

2019 has arrived! Now that you've made your personal resolutions, what's your plan of action for the new year for your business? Is this the year you decide to dive into foodservice in a big way? Maybe add a food delivery component to compete with quick service restaurants? Go big on breakfast and introduce an all-day breakfast sandwich? Gourmet-up your coffee offering? Bring in more healthy options for the all-important Millennial crowd?

PRODUCTION MANAGER Michael Kimpton | mkimpton@ensembleiq.com ART DIRECTOR | Christian Lemay

Director of Marketing Alexandra Voulu | avoulu@ensembleiq.com AUDIENCE DEVELOPMENT MANAGER Lina Trunina | ltrunina@ensembleiq.com WEB OPERATIONS MANAGER Valerie White | vwhite@ensembleiq.com CORPORATE OFFICERS EXECUTIVE CHAIRMAN | Alan Glass

ChiEF EXECUTIVE OFFiCER | David Shanker Chief Financial Officer | Dan McCarthy CHIEF DIGITAL OFFICER | Joel Hughes

Chief Innovation Officer | Tanner Van Dusen Executive Vice President, Events & Conferences Ed Several

SUBSCRIPtion services Subscriptions: $65.00 per year, 2 year $120.00, Outside Canada $100.00 per year, Single copy $12.00, Groups $46.00, Outside Canada Single copy $16.00.

Email: ycm@convenienceu.ca Phone: 1-844-694-4422, between 9 a.m. to 5 p.m. EST weekdays Fax: 1-844-815-0700 / Online: www.ccentral.ca/subscribe LICENSING AND REPRINTS 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. ©2019 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.

Shoppers expect change and they will move on if you don't continue to innovate to meet their evolving needs.

Or maybe your year of reinvention will mean an opportunity to refine your physical store space – perhaps moving aisles, adding new display units, rethinking layout to create a better shopping experience for consumers.

expect change and they will move on if you don't continue to innovate to meet their evolving needs. As retail consultant Deniz Gazi says, "Companies and brands in every channel can never afford to get complacent. Being in touch with consumer preferences and needs will always be the way to stay ahead of the competition.

Even for those already ahead of it."

Fortunately, c-stores are in an enviable position when it comes to jumping on innovation. You can react quickly to bring something new to your customers' attention. Plus, by being smaller format, you are able to offer a more personalized experience. And, let's not forget one of your biggest advantages – sheer convenience of location and hours of operation.

In this issue of Convenience Store News Canada, we highlight a convenience disrupter who's redefining what it means to be convenient. Think delivery-only, no storefront, just online access to popular snack items, "things you would find in your lunchbox as a kid," according to owner Connor McPhail. Snacko has virtual shelves from which customers with the munchies can order their favourites.

In a year of reinvention, what could be more convenient?

Perhaps this will be the year you integrate more tech options to help you run your business, whether it's app-based options for shoppers or upgrading your own back-office operations.

Whatever you do, do something!

Today's consumers are not standing still, and neither should you be. Shoppers

Jane Auster, Editor standard

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January / February 2019

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|7

THE BUZZ CROSS-CANADA ROUND-UP

People, places, news and events

Snack on this

Making vaping invisible?

Junk food withdrawal can be painful, according to new U.S. research that found forgoing chips, chocolate and soda can produce similar symptoms to quitting drugs during the first week. Participants in the study, published in Appetite, reported feeling sad, irritable, and tired when they stopped snacking. Cravings were most intense during the first two to five days.

Weeding out options While the scramble to take advantage of Canada’s legal cannabis market continues, Alimentation Couche-Tard Inc. is standing back from the fray – at least for now.

Two reasons for the convenience store chain’s reticence: concerns from staff and the community.

“Some people are scared about the buyers of cannabis, how they will act in the store, how they can control safety, security," Alain Bouchard, co-founder of the Quebec-based company, told the Canadian Press.

8

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| January / February 2019

Keeping vaping products out of reach and out of sight was originally included in regulations scheduled to take effect July 1, but Ontario’s Progressive Conservative government eliminated this requirement making it the first province to allow companies to directly market vaping products to the public. For its part, the OCSA has said: We suspect under the new government the ministry staff has been instructed to re-evaluate the restrictions and hopefully allow c-stores to display and promote the vaping alternatives. This may be the start of a new dialogue on issues affecting the channel. The OCSA will once again participate in the consultation going forward and keep every one updated as we learn additional information.” The Canadian Cancer Society and other health organizations are urging the Ontario government to nix plans that would allow for the unrestricted display and promotion of vaping products in full view of kids.

Opportunity knocks

The Ontario Convenience Stores Association is urging the provincial government to think small. It wants to ensure that its 8,000 members, many of whom operate stores that are only 400 to 500 sq. ft., are eligible to obtain a cannabis licence.

The OCSA pointed out during a legislative committee meeting on the issue that c-stores are already familiar with age-restricted products and have an excellent track record of keeping restricted products out of the hands of minors.

CANNABIS

Minimum wage higher in AB The minimum wage in Alberta is now $15 an hour – the highest in the country.

The new rate represents a $1.40 an hour increase over the previous rate.

Based on a 40-hour week, someone making the increased minimum wage will earn $2,912 more per year, which will help ensure that those in the service industry who take care of customers afford to take care of themselves and their families as well, says Christina Gray, Alberta’s minister of labour. This comes at a time when the Ontario government has walked back the commitment made under the previous Liberal government to increase the minimum wage.

An apple a day Nova Scotia’s NDP caucus has introduced legislation that would make it mandatory for all workers in the province to have paid sick days. Under the proposed new law, workers would earn one half-day for every month worked for a total of six days a year. In addition, employers would be prevented from requiring sick notes, a change put in place in 2018 by the Ontario government.

They deliver

7-Eleven has joined forces with foodora, an on-demand food-delivery service. To date, 48 of the c-store chain’s locations in Toronto, Vancouver, Calgary, and Edmonton are available for pick-up and delivery.

On the menu: everyday necessities such as milk and bread; snacks and treats like chips, chocolate bars, ice cream, and candy; hot foods including pizza, taquitos and chicken wings; and, you bet, Slurpees.

Giving back

Count on c-stores Data obtained from the Ontario Ministries of the Attorney General and Health and Long-Term Care show that Ontario convenience stores consistently sell age-restricted products like tobacco, lottery tickets, alcohol, and vaping products responsibly. In 2017, 19,822 mystery shopping checks were conducted by public health units

in support of the Smoke Free Ontario Act, and convenience stores were found to be 95.7% successful at denying sales to those under 19. No other retailer is checked as thoroughly by regulators as convenience stores, and no other retail channel can demonstrate comparable success rates of age verification, according to the OCSA.

The Canadian Convenience Stores Association celebrated Small Business Week by presenting a cheque for $130,000 to the Children’s Wish Foundation, all of which was raised during Convenience Store Day. More than 250 community leaders joined forces with 300 convenience stores across the country to raise the money, an increase over the $82,500 raised in 2017. Since Convenience Store Day was launched, over $362,000 has been raised by convenience stores for the Children's Wish Foundation of Canada.

Save the dates

February 12-14, 2019 | Miami Beach, FL NACS Leadership Forum https://www.convenience.org/ events/Leadership/forum

March 5-6, 2019 | Toronto, ON Convenience U CARWACS Show http://toronto.convenienceu.ca/

January / February 2019

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|9

QUICK BITES

by Darren Climans

Second sight...

or just second guessing?

Ever imagined what it would be like to be able to see the future like a modern day Cassandra?

If you remember your Greek mythology, Cassandra was a princess of Troy.

According to legend, the God Apollo fell in love with Cassandra and gifted her with the ability to foresee the future.

When Cassandra did not return Apollo’s affections, he scornfully placed a curse on her, that no one would believe her prognostications.

Here’s the part that may sound familiar to you – Cassandra predicted the destruction of Troy by the Greeks. When the Trojans found an enormous wooden

EXHIBIT 1

Every year, North America’s largest specialty food show, the Specialty Food Association’s Summer Fancy Food Show, is held in New York City.

This is ground zero for the food trends that will shape the retail and foodservice landscape in the years to come.

Datassential recently summarized ďŹ ndings and observances from the Summer Fancy Food Show, listing the newest, early stage inception trends, with an eye towards agging the future of avour in foodservice (Exhibit 1).

Top Food | Beverage Trends

1 - Indian chai 2 - Malasian Lime Leaf Sambal 3 - Indonesian Sambal Matah Chili Spread 4 - Korean Gochujang 5 - North African a paste 0DWFKD DQG PDWFKD ŴDYRXUHG SURGXFWV 7 - Middle Eastern Za’atar – ground dried spice mix condiment 8 - Yemeni Zhug – green hot sauce

*+(( &ODULĆ“HG EXWWHU

*UDVV IHG ODFWRVH IUHH Ĺ´DYRXUHG JKHH EXWWHUV 2 - Ghee spreads (coffee guarana, passionfruit, etc.)

3 - Ethiopian-spiced ghee

WATER

1 - Non-alcoholic wine water – combines wine grape skins and seeds with spring water 2 - Bee’s honey water 3 - Oxygen water – 100 times more oxygen WKDQbWUDGLWLRQDO ZDWHU

|

Divining the future

Datassential, a company dedicated to tracking restaurant MenuTrends™ in the U.S. and Canada – chains, independents, ďŹ ne dining, etc., uses extensive menu data to identify trends, and divine where they register on their Menu Adoption Cycle continuum (Exhibit 2).

FANCY FOOD SHOW 2018

GLOBAL FLAVOURS

10

horse outside the gates of their city, Cassandra declared, to no effect, the Trojans should ‘beware Greeks bearing gifts.’

| January / February 2019

CLEAN EATING

1 - Plant-based meats 2 - Veggie snack bars - made with fruits or veggies only 3 - No allergens snack bars – no nuts, dairy, or soy

GLOBAL PORTABLE 6$9285<b61$&.6 1 - Persian Kuku â&#x20AC;&#x201C; frittata-like potato omelette 2 - Onigiri (nori-wrapped Japanese rice balls) 3 - Heirloom fruits and nuts â&#x20AC;&#x201C; apricot, mulberries. &DXOLĹ´RZHU SUHW]HOV Ĺ&#x160; 62), *ROG $ZDUG ZLQQHU

PLANT POWER

1 - Plant-based meat alternatives â&#x20AC;&#x201C; the Impossible Burger 2 - Ahimi â&#x20AC;&#x201C; a tomato-based sushi & poke DOWHUQDWLYHbWR UDZ WXQD 3 - Vegetarian deli meat slices â&#x20AC;&#x201C; veggie prosciutto & spicy veggie carpaccio 4 - Mushroom jerky 5 - Plant-based butter alternative 6 - Microalgae plant- based mayo alternative

.20%8&+$6 9,1(*$56 1 - Hopped kombucha made with beer hops 2 - Honey-fermented hard kombucha 3 - Apple cider vinegar tonic â&#x20AC;&#x201C; each bottle has two WHDVSRRQV RI XQĆ&#x201C;OWHUHG YLQHJDU 4 - Single-serve instant apple cider vinegar powders

&21',0(176 &5($0(56 3UHPLXP NHWFKXSV Ĺ&#x160; FXUU\ Ĺ´DYRXUHG XQVZHHWHQHG 6DQ 0DU]DQR WRPDWR 2 - Artisan condiments 3 - Alternative creamers â&#x20AC;&#x201C; almond & coconut creamer, peppermint mocha

FUNCTIONAL FOODS

1 - Organic 2 - Turmeric 3 - Moringa â&#x20AC;&#x201C; a nutrient-dense superfood 4 - Manuka honey â&#x20AC;&#x201C; made from nectar gathered from the New Zealand manuka tree 5 - Hemp 6RXUFH 'DWDVVHQWLDOV )RRG%\WHV

CCentral.ca

Integrity is a trend with legs "Food Integrity" is a big tent trend, with lots of room for expressions of planet-friendliness: GRASS-FED beef, milk, butter, ghee, and ice cream FUNCTIONAL FOODS like organic, free-range, gut friendly, superfoods CLEAN EATING UĂ&#x160; Meat alternatives UĂ&#x160; Vegan/Vegetarian UĂ&#x160; Non-allergen (dairy, gluten, soy, nut) UĂ&#x160; Carbon footprint - local

Food truck/street food inspiration This trend has been building for the better part of the last decade. It taps into adventurous consumersâ&#x20AC;&#x2122; desire for authentic ďŹ&#x201A;avours and unique food experiences.

Fueled by technology, food has become its own narrative for consumers who actively engage with social media. They arenâ&#x20AC;&#x2122;t just looking for global ďŹ&#x201A;avours, but also want to be able to know, and recount, the story behind the product.

Trend consultants Baum and Whiteman recently called out 2019 as the year of the â&#x20AC;&#x153;Bings,â&#x20AC;? a Chinese burri-

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CYCLE Ethnic markets

Ethnic aisle Farmers markets Specialty grocers Gourmet food stores

According to Statistics Canada, monthly retail food sales trended down repeatedly in the ďŹ rst half of 2018, year-over-year.

Part of this downward cycle is related to price deďŹ&#x201A;ation, triggered by big retaillers dropping prices to try to hold volume share.

Traditional grocery

Sylvain Charlebois, professor in food distribution and policy, Dalhousie University, believes that the exodus of retail food customers is a consequence of food demand becoming more fragmented, and symptomatic of foodservice â&#x20AC;&#x153;progressively winning over food retailing.â&#x20AC;?

Waves of change are inevitable.

Evolving preferences beget new products and delivery models. Thereâ&#x20AC;&#x2122;s no holding back disruptors like Uber Eats and Hello Fresh. And the convenience channel is no longer immune to such threats. In the fall of 2018, a start-up called Snacko opened in downtown Toronto. (See proďŹ le on page 19) Snacko's motto is â&#x20AC;&#x153;Your favourite snacks delivered in minutes.â&#x20AC;? Snacko partners with Uber Eats to function as a delivery only convenience store. It operates out of an 8 x 10 foot spartan box in downtown Toronto ďŹ lled with chips, chocolates, soda, and other packaged snacks. The plan for Snacko is to add

Mass merch Club stores

Drug stores Dollar stores

INCEPTION

Ethnic independents

Should you ďŹ nd an oversized wooden object at your door, and though youâ&#x20AC;&#x2122;ve been warned to beware, itâ&#x20AC;&#x2122;s not always easy to know how to respond.

For food retailers, the gates have already been breeched.

Technology, and consumers seeking a combination of discounts and convenience, are radically changing the face of retail food shopping.

FOOD SERVICE

RETAIL

Time and tide waits for no one

Fine dining

ADOPTION

What will be the next sriracha? Consider Yemeni/Israeli green pepper Schug sauce, or Korean Gochujang red chili paste. Hot and ethnic is still very much a market driver. Having a wide selection of eclectic sauces ticks a lot of boxes for consumers of all ages and orientations, both digital and analogue. A number of fast casual chains have ďŹ gured out that itâ&#x20AC;&#x2122;s cheaper and easier to execute a broad condiment bar than it is to expand core menu offerings. In addition to salsa, sriracha, BBQ, and marinara sauce, Firehouse Subs also offers â&#x20AC;&#x153;Captain Sorensen's Datil Pepper Hot Sauceâ&#x20AC;? on its condiment bar.

MENU ADOPTION

Gastro pubs Chef-casual Food trucks Upper casual Casual independents Fast casual

PROLIFERATION

Consider the arc of growth of sriracha sauce as a condiment. From early days in the 1970s as the brainchild of a Vietnamese immigrant, to ďŹ rst stage growth being sold from a van and a 5,000 sq. ft. building in Los Angeles, to current days â&#x20AC;&#x201C; a bustling 650,000 sq.ft. stateof-the-art facility shipping to over a dozen countries.

EXHIBIT 2

to-style street food wrap sold at fast casual restaurants as a snack or meal: UĂ&#x160; Ă&#x160; Â&#x2026;Ă&#x2022;Â&#x2DC;Ă&#x160; Â&#x2C6;Â&#x2DC;}Ă&#x192; - northern Chinese ďŹ&#x201A;atbreads made of wheat UĂ&#x160; Ă&#x160; Â&#x2C6;>Â&#x2DC;Ă&#x160; Â&#x2C6;Â&#x2DC;}Ă&#x192; - ďŹ&#x201A;akey, eggy crepe-like dish with a cracker inserted for crunch

Lodging Casual chains Colleges Quick service restaurants Grocery deli

Convenience stores

UBIQUITY

Hot is hot

Corporate cafeteria Family restaurants Healthcare K-12 schools

Source: Datassentials, datassential.com/pdf/The_Menu_Adoption_Cycle.pdf

strategic locations to be able to service multiple neighbourhoods, and eventually, expand this model to other cities.

No better reason to work that much harder to capture foodservice customers, and make your location a destination for your customers, before they opt to have convenience brought to their door. Z 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.

January / February 2019

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| 11

MarchĂŠ Lali features

Montrealers'

favourites Text by Mark Cardwell Photography by Chantale Lecours

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| January / February 2019

CCentral.ca

lime

M

aximilien Lalime says location, quality food and personalized customer service certainly help to explain the continued success of his family’s thirdgeneration convenience store and specialty market near downtown Montreal.

But he credits his family’s devotion to the business and their ability to stay in step with the times for making Marché G. Lalime a local institution for the past 60 years.

Patrick and Maximilien Lalime

“We’ve evolved with the neighbourhood and made changes to meet people’s demands,” says Maximilien, a 32-yearold father of three and grandson of store founder Gilles Lalime. He has worked for his father Daniel Lalime, the current store owner, for more than a decade.

January / February 2019

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Marché G. Lalime's

top tips:

“We listen to our clients and try to offer them the things they want and need,” says Maximilien – Max to family, friends and store regulars.

Fresh food sells A case in point is the store’s introduction a year ago of a new meat pie made with shredded beef bourguignon.

The store sells – and is renowned for – a wide selection of homemade food items and prepared meals that members of the Lalime family make fresh on an almost daily basis.

“None of us thought it would do well,” Max says about the shredded beef pie, which was a spur-of-the-moment idea to recoup an overcooked beef bourguignon. “But it’s done great. We sell a ton of them now.”

The new product bolsters the store’s lineup of top-selling dishes like lasagna, tourtière (meat pies), ragout, shepherd’s pie, vegetarian meals, and salads.

Its most popular items, however, are home-style sandwiches made mostly with sliced white bread.

The runaway bestseller is the “Club-matin,” a toasted, three-decker breakfast sandwich that sells for only $2.99 – the best food bargain in the city according to store customers, says Max.

Its iconic club sandwich has also earned the store local fame, helping to drive the occasional sales of t-shirts and baseball caps emblazoned with the Marché G. Lalime logo.

“People come from all around to get our food,” says Max. “It always smells good in our store and there is always a good vibe.”

From meat to much more That’s a big change from the store that his grandfather Gilles, a butcher by trade, opened in 1959 on Boulevard St Laurent, a busy north-south commercial artery that spans the width of the island of Montreal at its centre point.

1 2 3

Promote your strengths. "We are always telling our clients how good our food is and what a great deal it is – and they always agree. It's important to make that kind of a claim – but only if it's true, and in our case, it is."

Know your customers. "You need to be interested and attentive to everyone who walks through the door on both a personal and professional level. But that interest has to be genuine."

Like what you do. "It takes love and acceptance of what you do to keep employee morale high and make your customers feel welcome when they come in the store. This is a business like any other – it functions best with a positive, winning attitude."

Located at the junction of three big city boroughs – Outremont, Le Plateau and Rosemont – the original store supplied mostly fresh meat products to the many large working-class families who lived in the area.

After moving the store 30 years ago to its present location a few hundred metres south at the corner of Beaubien Street, the Lalimes added everyday grocery items, plus lottery tickets, wine and beer. They also started making and selling homemade dishes of popular Québécois foods.

“My grandad and dad realized that people were too busy and no longer had

People come from all around to get our food.

It always smells good in our store and there is always a good vibe.

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Daniel’s brother, Patrick, comes into the store most mornings at 3 a.m. to make and fill the cooler with 100 sandwiches or more, often with the help of his wife.

time to make the traditional foods they like,” says Max. “So they decided to try and fill that need.”

From the get-go, that food production has been a family affair for the Lalimes.

Daniel’s brother, Patrick, for example, comes into the store most mornings at 3 a.m. to make and fill the cooler with 100 sandwiches or more, often with the help of his wife.

That doesn’t include the side orders of toast for $1 and the dozens of “Clubmatins” and other made-to-order sandwiches that start going out the door with overnight and early-bird workers as soon as the store opens at 5 a.m.

Daniel, his sister, Ginette, and three of Max's cousins help to make and fill food orders and to staff the store during the day until closing time at 11 p.m.

Daniel's wife, Marie-Claude, makes vegetarian plates at home that Daniel brings in to the store.

According to Max, those plates, which were added to the store’s food line a few years ago in response to the growing vegan movement, have proven wildly popular. “The idea for a vegetarian plate was on our radar, we talked about it and then – boom! – we introduced it,” says

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Max, who handles the store’s cash and manages everything from traffic flow and home deliveries by bike to lottery tickets and store inventory. “That’s how we’ve

always done it for new things and it has worked well. I don't see why we'd change that approach.” ◗

Snapshot Family-owned business for three generations, started by butcher Gilles Lalime in 1959.

Specializes in home-cooked Quebecois favourites like tourtière.

Most popular food item: the "Club-matin," a toasted, three-decker breakfast sandwich that sells for only $2.99, which explains why Marché G. Lalime sells 75+ of them a day.

Recently added more vegetarian options to appeal to customers' changing tastes.

Offers home delivery by bike.

THE ORIGINAL LIGHTER, MODERNIZED We believe, as a brand, that trustworthy performance can be synonymous with fair price

Inventor of disposable lighter

Made in Holland

Easy-fit design

Tested 60 times

Smoother striker

F i xe d f l a m e | C h i l d r e s i s t a n c e | E x t r e m e l y t o u g h , w i l l n o t b r e a k H i g h t e m p e ra t u r e r e s i s t a n c e | S l i m b o d y | B o d y i n n y l o n 6 . 6

A s k y o u r S TG C a n a d a Representative:

ADVERTORIAL

Finally, selling vapes just clicks and they all magnetically click together. No more wasting valuable staff time learning about and explaining vape systems. And Logic Compact’s intense high nicotine e-liquid pods give customers the vaping experience they’ve been asking for.

Bringing customers back again and again

LET’S FACE IT, the vaping marketplace is

complicated. Open tanks, e-liquid pods, heated tobacco, batteries – it’s a lot for retailers and customers to take in. But not anymore. The new Logic Compact eliminates unnecessary complexities to allow for the best vape experience. Long-time industry partner, JTI, sets the bar in convenience, performance and design for both retailers and customers.

With Logic Compact, finally vaping just clicks.

Logic Compact is the latest closed tank, high nicotine vaping innovation to hit the market, and it is being launched exclusively through selected Canadian retailers in British Columbia and Ontario. With Logic Compact, JTI is making vaping simpler and more enjoyable than ever. E-liquid pods are available in four intense flavours and provide roughly 350 puffs per pod.

All customers need to do is click the e-liquid pod into the device and vape.

Vapourizing the competition Other vape pens on the market are hard to use and even harder to explain. From product training, battery life to flavour refilling and quality, they’re a headache for convenience store staff. Logic Compact has just three parts—the battery, the e-liquid pod and the charger—

SIMPLE

State-of-the-art technology is easy to explain to staff and customers

HIGH MARGINS

Retailers enjoy 20% margins if sold at Recommended Retail Selling Price on starter kits and refill packs, and no online competition during product launch

As a convenience store operator, JTI recognizes your need for customers to walk through your doors on a repeat basis. That’s why Logic Compact is being launched exclusively in convenience stores and not in vape shops, so you don’t have to worry about online competition while building your customer base. And what’s even better, the refill pack contains just two e-liquid pods. That’s half as many pods per pack as key competitors — for twice as many in-store visits from your customers. Logic Compact will keep them coming back.

Attractive margins extend JTI retail partnerships JTI believes its partnership with you just clicks. JTI has earned your trust by selling you high quality, high traffic products. That’s the advantage you get from working with JTI, a company that has 160 years of experience building retail partnerships in Canada. It sets JTI apart from the competition – and the company wants to keep it that way. It’s why Logic Compact is a competitively priced, high-margin product for retailers. If applying JTI’s recommend-

FOOT TRAFFIC

With just two e-liquid pods per pack, Logic Compact will keep your customers coming back

SMALL FOOTPRINT

Easy to stock, easy to onboard staff, easy to sell – no more time away from customers dealing with the ins and outs of vapes

ed retail selling price, convenience store owners are looking at 20% margins on sales of Logic Compact’s starter kit ($29.99) and e-liquid pod refill packs ($9.99).

Introducing Logic Compact, a brand new premium electronic vapourizer that features the perfect combination of flavour, power and, most importantly, simplicity. Finally, a vaping product for convenience stores that just clicks.

AVAILABLE IN 4 INTENSE FLAVOURS: 59 MG/ML

59 MG/ML

CONTAINING NICOTINE SALTS FOR ENHANCED FLAVOUR*

58 MG/ML

58 MG/ML

*For some consumers, nicotine salts may make it easier to inhale the high level of nicotine contained in this product than would be possible without it.

Canada’s delivery-only convenience store en route to success Text by Donalee Moulton Photography by Jaime Hogge

Customers in Old Toronto, Little Italy, Chinatown, and neighbouring areas of Canada’s largest city who crave a bite of chocolate or a salty nibble late at night but don’t want to make the trip to the nearest store, now have an option to appease their snack attack – from the comfort of their couch. Snacko is one of Canada’s first delivery-only convenience stores.

January / February 2019

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The #1 Milk Chocolate Family Bar Brand1 and the #1 Cookie Brand in Canada2 are Coming Together!

Strong investment in a national media campaign including TV, Digital, Mobile and Out of Home!

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Item #: 612000147100 SCC#: 00061200014716 Retail Dimensions: (w) 11.5” x (L) 11.25” x (H) 20.75” Contents: 48 CARAMILK 50g 36 CADBURY DAIRY MILK OREO 38g

Available Now!

Snacko's top tips:

1 2

Differentiate yourself from others. Standing out from the crowd keeps you top of mind. At Snacko, for example, each order comes in a nice bag with a company logo. The little extra touches matter.

Exceed customer expectations. Going above and beyond matters to customers. Connor McPhail, for instance, often writes a personal note for the customer on the delivery bag where it can’t be missed. Sometimes a few extra treats are included.

That includes a high level of comfort with online shopping and the use of social media. Thanks to prominent placement on Uber Eats – where Snacko is the highest rated store in downtown Toronto – and the active use of social media to reach new and existing customers, business is doing very well. “We’re definitely looking at expansion plans,” says McPhail. “We want to make our service available to as many people as possible.” ◗

Snapshot Opened: Snacko went live on August 27, 2018.

Location: A shipping container (actually half a shipping container) located on Dundas Street in Toronto

Hours: Monday to Thursday 3 p.m. to 12 a.m.

Friday 3 p.m. to 2 a.m.

Saturday 5 p.m. to 2 a.m.

Sunday 5 p.m. to 12 a.m.

Bestsellers: Nostalgic snacks including Rice Krispy Squares, Fruit by the Foot, and Goldfish. “Things you would find in your lunchbox as a kid.”

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®

Now you can serve Hot & Ready sandwiches for any time of day.

Easy prep and a variety of flavours give customers quick, delicious options they’ll love in both AM and PM. Individually wrapped sandwiches deliver added convenience for on-the-go customers.

Find out more at tysonfoodservice.com/contact-us

©2018 Tyson Foods, Inc

COVER STORY

TH E

LA W

It's coming!

Get ready for plain packaging

Plain and standardized tobacco packaging is set to come to Canada late this year.

New federal regulations, now in draft form, propose to standardize all tobacco packaging with â&#x20AC;&#x153;matte, dark, drab brownâ&#x20AC;? as the base colour for all brands, as mandated by Health Canada.

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Text by Lawrence Herzog CCentral.ca

The new regulation will ban all logos, and the name of each brand will only be printed in a standard font along the bottom of the package. Instead of flip-top sealed packages that are now commonly used, manufacturers will be required to revert to a "slide and shell" wider packaging format where cigarettes slide out of the pack at the top.

“If we have to move standardized packaging, it will be truly a company-wide effort and will involve every member of our team from engineering and R & D to our sales reps across the country,” says Caroline Evans, head of corporate affairs and communications, JTI-Macdonald. “We are engaging with the regulator to seek some necessary changes and working with retailers and wholesalers to anticipate particular challenges and identify solutions.

Different tobacco products have different packaging issues to address, notes Jeremy Adams, director of government and corporate affairs for National Smokeless Tobacco Company. “Once we have new packaging designed and ready for manufacturing, we will make sure our sales force and key accounts management has materials for the trade which outline our old packaging compared to the new. We want to educate retailers about transition periods to sell through old inventory and make sure they understand the differences between our smokeless SKUs in order to provide the adult consumer with their requested product.”

Making way for the transition Tobacco manufacturers are getting ready for the potential arrival of standardized packaging and preparing to support retailers with a range of measures. “We are committed to providing clear communication to our retailers so they know what to do, and when to do it,” says

CCentral.ca CCentral C Central ca ca

Sylvain Laporte, president, Scandinavian Tobacco Group Canada. “For cigars and pipe tobacco, the proposals have not been as clear, and so we are working to clarify with Ottawa.”

Reorganizing storage, training staff and selling through inventory all takes time. But the federal government has proposed just three months of transition for retailers, JTI’s Evans notes. “That’s the shortest of any country so far, and for a change that will impact on how retailers will store tobacco products given the move to slide and shell.”

If retailers have concerns about this timing or the standardization to a wider pack format, Evans urges them to call or write their local Member of Parliament and let them know. “The deadlines will be fixed in final regulations and it’s important to make your voice heard now, before it’s too late.”

We are engaging with the regulator to seek some necessary changes and working with retailers and wholesalers to anticipate particular challenges and identify solutions..

Caroline Evans, head of corporate affairs and communications, JTI-Macdonald

cheaper brands, so price has emerged as the key driver. “Plain packaging has devalued brands and changed the sales mix so that the key focus from consumers is on the cheapest price when there is no ‘image’ attached to a particular pack,” says Jeff Rogut, chief executive officer of the Australasian Association of Convenience Stores (AACS). “That affects sales and profit dollars.”

Without colour, pack shape or branding to differentiate between products, providing quick and efficient service is even more of a challenge. That can mean more time waiting in line for customers, and it increases the chances of choosing the wrong tobacco product.

Learnings from Australia Around the world, eight countries have implemented or announced their intention to require plain packaging, and a dozen more are studying the issue. Australia was the first in 2012, and lessons learned by c-store retailers there are helpful to understand challenges and opportunities for Canadian operators.

Plain packaging in Australia has impacted what smokers purchase and retailers have seen a shift towards sub-value,

Security measures have had to be strengthened at retailers’ expense as the cost of legal tobacco has risen. “Transaction times have increased as store staff must spend a considerably longer time with their backs to customers, sorting through similarly packaged products, increasing the risk of robbery,” Rogut says.

Research commissioned by Philip Morris and supported by the AACS and other retail associations reveals two-thirds of Australian retailers say it takes more time to train staff as a result of the changeover.

More than three out of four retailers report an increase in the time taken to serve adult smoker customers.

January / February 2019

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Prepare and respond

We are committed to providing clear communication to our retailers so they know what to do, and when to do it.

Sylvain Laporte, president, Scandinavian Tobacco Group Canada

“Tobacco storage needs to be exceptionally well planned and organized so that SKUs can be quickly located when customers ask for them,” JTI’s Evans says.

“Preparation is key and retailers should start thinking now about what will make sense for their stores in the new environment.”

Watch stock levels leading up the changeover date

Train staff on procedures and prepare for customer questions

Negotiate with tobacco suppliers to take back/swap unsaleable stock

Evaluate and strengthen your security procedures Decide on the best tobacco layout for the store

et to know the new G look of each SKU

Be vigilant in reporting any suspected illegal tobacco activity

ay close attention to P selecting the right SKU for the consumer Understand specific packaging issues, such as trade-only vs. consumer sale

Plain packaging in place Plain packaging rules are already in place in several countries. A legal challenge by tobacco firms in the United Kingdom was turned down last year.

Most countries allow a transition period between when manufacturers must produce plain (standardized) packs and when retailers are required to sell all products in plain packs to sell old inventory.

Country 1|

Australia

Manufacturer level Retail level

Country

October 1, 2012 December 1, 2012

5|

Manufacturer level Retail level Norway

July 1, 2017

July 1, 2018

Ireland

September 30, 2017

September 20, 2018

2|

France

May 20, 2016

January 1, 2017

6|

3|

United Kingdom

May 20, 2016

May 20, 2017

7|

Hungary

May 20, 2018

May 20, 2019

4|

New Zealand

March 14, 2018

June 6, 2018

8|

Slovenia

January 1, 2020

January 1, 2020

3

Legislation is being considered by the parliaments of Brazil, Chile, Ecuador, Panama and Uruguay. The issue is under formal government consideration in Finland, Guernsey and Jersey, Singapore, South Africa, Sri Lanka, Sweden and Taiwan.

Several other countries have also committed to implement plain packaging. They include Belgium, Botswana, Kenya, Malaysia, Mauritius, Nepal, The Gambia, Turkey, and United Arab Emirates.

5

6 2

7 8

1 4

Source: www.tobaccofreekids.org

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See. Touch.

Taste.

Learn.

The Convenience U CARWACS Show raises the bar in Toronto Text by Talbot Boggs

If you’re in convenience and gas retailing and want to see and hear about the latest products, services and business strategies in the industry, then mark your calendar for this year’s Convenience U CARWACS show, taking place March 5 and 6 at Toronto’s Congress Centre.

The show is Canada’s number one trade and education event for the convenience, gas and car wash industries.

Hundreds of exhibitors will display the latest and most innovative products and

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services available in the Canadian market. In conjunction with the trade show is the additional opportunity to attend educational seminars and presentations on a broad range of topics designed to help retailers develop the tools and strategies they need to improve their level of customer service, enhance their businesses, and increase their bottom line.

“Convenience U CARWACS is the one place in Canada where retailers and operators get a chance to see, touch, taste and ask questions about the very latest products available to your customers and the latest products and services to improve your business,” said Michael Cronin, Vice President, Events, of show organizer EnsembleIQ. “Anyone who wants to know about the latest developments in the industry and have the opportunity to network, talk and share best practices with industry leaders and peers needs to be there.”

This year’s show will feature a broad selection of educational presentations on a wide variety of topics affecting convenience retailers. Among them:

Stay relevant in a competitive industry.

Hire the right people for the right job.

Media and marketing expert Tony Chapman will kick off this year’s conference with a thought-provoking presentation that will explore what the convenience channel needs to do to stay relevant in a super competitive industry by turning stores into destinations rather than just places to buy.

Making the wrong hiring decisions can be a very time-consuming and expensive mistake in terms of lost sales opportunities, duplication of training, strained customer relations and other potential issues. This presentation will help you build the skills and knowledge to develop the ideal candidate attitudes and motivators for a position, design candidate profiles, attract the best people and recognize winners when they walk into your office.

Leverage OLG innovations to create excitement and drive sales.

Ontario Lottery and Gaming (OLG) will showcase some new ideas, technologies and best-in-class practices to help c-retailers drive traffic to their stores and increase sales.

Two of the most important aspects of running a business today are to hire the right people for the right job and to create a workplace culture that allows your employees to provide your customers with a superior shopping experience. By attending this year’s conference you will come away with the skills and knowledge to do both.

Presented by Gail Green

Create a workplace culture that is good for your business.

Employees today have many choices where to work and customers have multiple choices where to shop – which is why creating a great workplace culture is paramount for success. Learn how your culture can help or hinder your business, how you can shift your store culture in ways that engage your employees and equip and empower them to provide exceptional customer experiences, leading to greater loyalty and superior results.

Presented by George Anastasopoulos

Educational seminars will be held in the mornings of both days between 9 a.m. and noon. The must-attend trade show is open both days from noon to 5 p.m.

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CATEGORY CHECK

by Talbot Boggs

Sweet!

C-stores are

candy central Any time is candy time for convenience stores. Candy continues to be a very profitable category in the convenience and gas channel and retailers need to be ready to offer consumers multiple choices and options in a clean, friendly environment while at the same time optimizing freshness.

“Purchasing candy is a fun and self-indulgent consumer outing,” says Eric Longval, vice-president of sales with Mondoux Confectionery. “The consumer still is looking to indulge and enjoy their favourite treat without compromising taste. Variety adds to the shopping experience with multiple choices and options, but there needs to be a balance of variety while optimizing freshness.”

and special features such as gluten free, products with natural flavours and real fruit juices, and gummy-filled.”

Figures from Nielsen Canada from a recent 52-week period show that total candy sales increased 11 per cent to $70.3 million. Sales of breath fresheners, licorice and novelty products all showed modest increases of anywhere from two to five per cent. Sales of chocolate showed a slight increase of two per cent over the same period.

“Confection is purchased 85 per cent on impulse, so locate the display as close to the cash as possible or in a high-traffic area such as beverage,” Longval says. “Brand recognition is key for chocolate offerings – there is a high degree of loyalty in the top 10 or 20 bars – but for sugar confection consumers quite often purchase by shape (like gummy bears), detail and value.”

“In spite of the entry of better-foryou products, non-chocolate sugar confections have been showing above industry standard growth due to large format offerings and assorted gummy mixes – the 400 gram Sweet Sixteen is a perfect example of this growth,” says Longval. “Assorted mixes and larger sizes grew faster than the rest of the category and having resealable bag and cup containers also is important.”

Sriram Rajamani, national sales director with Vidal Candies Canada, recommends retailers focus on their total candy portfolio. “Look at everything – branded packaged products, candy packaged in store and novelties such as bulk penny candy in trading areas where it is allowed by the authorities,” he says.

“And while selecting innovation SKUs, give consideration to product offerings

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Longval believes consumers are looking for recognizable brands, quality flavour, texture and value, innovative products with the increased use of natural ingredients and distinctive flavours, and products with fun and colourful packaging.

Despite growing interest in healthier confectionery, Longval believes average consumers are still looking to indulge and enjoy their favourite treats without compromising taste.

“I would say that gluten-free, good-tasting confection is the one trend we see evolving in the sugar confection segment,” he says. “Healthier confection options remain a very small segment of the category.”

Candy confection clearly is highly profitable, so c-retailers need to take advantage of it.

“Track unit sales, SKU turns, volume sales and gross mar-

gins,” advises Rajamani. “Set sales volume and GM targets, allocate time to review results regularly and take corrective action if needed.” Z

Sweet tips for success

1

Offer the right assortment at the right price every day.

2

Create excitement and drive trials and multiple purchases through promotions.

3

Be prepared for all seasons such as spring, summer, and back to school, Halloween, Christmas, Valentine’s Day and Easter, since candy is a perennial top seller.

4

Build your candy section with fastturning items but also save space for innovations.

5

Make sure the display price is visible and the product display looks fresh and faced-up daily.

6

Avoid sun exposure as products may melt and tarnish.

7

Feature the correct balance between peg and shelf displays. Allow at least 50 per cent space to peg to maximize inventory turn.

8

Try to eliminate “me too” offerings and expand on truly differentiated products.

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SNAPSHOT

by Isabel Morales

H2O to go

Water sales increasing across convenience channels As far as choice goes, there’s never been a better time to be a consumer. Thanks to globalization and connectivity, consumers around the world have access to a wider array of products than ever – a trend that’s likely to continue going forward. And the bevy of choice involves products and services from both multinational and local brands. But even in an era of massive choice, consumers have spoken: water is a top choice and sales continue to see strong growth in Canada across convenience stores.

In step with consumers around the globe, Canadians are actively working to improve their health and make better decisions for their overall wellbeing.

Leading a healthy lifestyle is now top of mind for many consumers, but the approaches they take are as individual as the people themselves. One thing that seems to ring true though is consumers are quenching their thirst with water.

With more than two-thirds of Canadian consumers (71%) feeling overweight and 54% actively trying to lose weight, finding the right combination of food and beverages is key to a well-balanced diet. While individual plans and strategies differ from consumer to consumer, almost three-quarters (74%) of Canadians are including a very simple choice in their quest: actively trying to drink more water.

As consumers put their money where their health is, water sales across convenience outlets are growing across water categories that include flat water, carbonated water and coconut water. In the most recent year, flat water accounted for nearly $124 million in annual sales across the convenience channel in Canada, up 2% from the previous year.

But while flat water may lead the way in total sales, other options are gaining momentum. Sales of carbonated water, for instance, increased 36% in the current year, reaching nearly $16 million.

And while newer to the market, coconut water is adding another $3.4 million in sales across convenience channels in Canada.

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FLAT WATER As Canadians work to keep hydrated, flat water sales are climbing and plain and simple ‘regular water’ led the way with 5% increase in both dollar sales and unit sales, proving once more that when it comes to nutrition consumers are going back to basics and keeping it simple. As simple as the purchase of water may seem, consumers still have to choose among a plethora of water sizes.

But it seems consumers are taking on the "go-big or go-home" mentality. Sales of flat water in 500ml-1L sizes command control with sales exceeding $82 million and dollar growth of 3%.

CARBONATED WATER Renewed interest in carbonated waters is yet another reflection of consumers’ ongoing shift toward opting to make healthier choices, and a testimony to the power of innovation. The carbonated water category taps into several health and wellness trends popular with Canadians today, such as the appeal of a low-carbohydrate and low-calorie option that can potentially be seen as a low-guilt beverage and an offering that is also gluten-free. Beyond the potential health benefits consumers see, these drinks can be refreshing, provide new and exciting flavours and, within the beverage alcohol market, the versatility to shake a cocktail mix draws attention. For carbonated water, innovation is fuelling the growth with more flavours and formats available to Canadians.

While it’s good to know that Canadians endeavour to achieve a healthy overall lifestyle, it’s helpful for retailers and manufacturers across the country to understand why. What’s at the top of their list? As consumers age, preventing future health issues (68%) comes first, followed closely by 63% of consumers who want to look and feel good. As Canadians take charge of their health, increasing their water intake is a way to keep up with their health goals and is also a guilt-free way to stay hydrated and energize the body. Staples like water give manufacturers and retailers an opportunity to partner with consumers in their quests for healthier lives.

Isabel Morales is the manager, consumer insights consumer insights for Nielsen for Nielsen Canada.

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BACKTALK

6 questions for

Jan Westcott

President & CEO of Spirits Canada

Photography by Jaime Hogge

It's all about leveling the playing field

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Would it be fair to say there isn't a level playing field for the retailing of alcoholic beverages – including beer, wine and spirits – across Canada?

This may perhaps be the understatement of the millennium.

While adult Canadian consumers have evolved significantly over the decades, many of Canada’s alcohol policies are remnants of the immediate post prohibition era. Today’s consumers view beverage alcohol categories, and to some extent even brands, as if not interchangeable then substitutable.

Government policies, on the other hand, continue to use antiquated definitions and arbitrary distinctions to intervene in the market and interfere with consumers’ preferences and choices.

Are you seeing any movement at all on leveling the playing field for convenience retailers who want to retail alcoholic beverages? For instance, we hear that Doug Ford will be opening the doors to some alcohol retailing at convenience stores. Are there other developments you're hearing about?

In some provinces, convenience stores already do sell alcohol. Most provinces, for example, allow convenience stores to participate in their agency store programs selling beer, wine and spirits in the same retail environment as other goods. Such programs allow for cost-effective expansion of liquor retail stores into communities and markets that could not economically justify an alcohol-only retailer.

Is there a sales lift if c-stores are given the chance to retail alcoholic beverages?

There is no doubt that offering a full range of beer, wine and spirits can act as a customer draw and can also incite important impulse sales. But, retailing beverage alcohol also comes with important costs and obligations. These include stringent employee training to avoid selling to the underaged or impaired, product knowledge to inform and assist consumer purchase decisions and regulatory compliance costs. My personal

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advice would be if you’re in it simply for a quick buck, don’t bother. Only those responsible retailers interested in building a long-term business for their consumers should look into selling alcohol.

You've gone on record as saying: “Excluding spirits from grocery store sales is not fair and does not make sense.” Do you feel the same way about excluding spirits from convenience stores?

Our issue with the Ontario government has been the inequity brought about by the previous administration’s refusal to grant spirits the same access to Ontario consumers as has been afforded to beer and wine, products that compete directly with spirits. The absurdity of this discrimination is best exemplified by the fact that, today, beer and wine made in other countries enjoy better access to Ontario consumers than do spirits made in Ontario by Ontario workers from grain sourced 100 per cent from Ontario farmers. Boiled down to its essentials, this means products supporting jobs in other countries are receiving preferential treatment to that afforded products made in and supporting jobs in Ontario.

When this is pointed out to ordinary Ontarians, their response is, “No, really, you can’t be serious?”

If cannabis becomes widely permitted for sale either in convenience stores themselves or in separate c-storeoperated buildings, do you think the same argument for privatizing alcohol sales can be made?

Legalized recreational marijuana and beverage alcohol are two very different products. Beverage alcohol is most often enjoyed communally between friends or family, to celebrate important events or milestones, and has been an integral part of our communities for thousands of years. Policy makers are just scratching the surface as to the mid- to long-term implications of legalizing recreational marijuana. I think alcohol policy will continue to evolve based on consumers’ needs and expectations for convenience,

alcohol policy will continue to evolve based on consumers’ needs and expectations for convenience, service, value and choice. service, value and choice, all largely independent of the path that may evolve for recreational drugs like marijuana.

As we welcome the new year, what other retailing trends (for alcoholic beverages) should convenience retailers be aware of?

Beverage alcohol is a highly competitive business with, in the case of spirits, government taking 80 per cent or more of the retail price as taxes and markups.

This means everyone else in the beverage alcohol business, other than government, must exist on (and share) the remaining 20 per cent. So, there is no cash cow for business operators.

Brands still matter in the spirits business. Brands with true authenticity and heritage have a leg up on “me too” brands. Price is an important driver, but value even more so. Spirits consumers are willing to pay a little more for a unique value proposition. Canadian consumers are also more open to trying products from around the world, whether a whiskey from Japan or Ireland, a Tequila or Mezcal from Mexico, Cachaca from Brazil or a Pisco from Peru or Chile.

And, of course, more flavourful products like whisky, particularly rye whisky and premium and super premium brands are still on fire. ◗

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