May/June 2013 by Grocery Business

May | June 2013 Vol 3 | No 3

$9.95

Talking Sustainability with Target Canada’s

PM # 42211029

Derek Jenkins Grand Prix Finalists Revealed John Scott’s Career Tribute grocerybusiness.ca

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PEOPLE • PRODUCTS • PROMOTION • PASSION

May | June, 2013 Volume 3, Number 3

grocerybusiness.ca Co-Publisher and Executive Editor Karen James 416-561-4744 KarenJames@grocerybusiness.ca Co-Publisher and Content Director Kevin Smith 416-569-5005 KevinSmith@grocerybusiness.ca Executive Vice-President Content and Market Development Dan Bordun 416-817-5278 DanBordun@grocerybusiness.ca Managing and Online Editor Noelle Stapinsky Contributing Editors Sally Praskey, Angela Kryhul Contributors Alan Boughton, Perry Caicco, Nancy Croitoru, Brent Houlden, Robert Levy, Michael Marinangeli, Philip Scrutton, Catherine Yuile Creative Agency Boomerang Art & Design Inc. boomart.net Cover Photo Mathew Plexman Subscription changes & updates or general inquiries: info@grocerybusiness.ca

Grocery Business Advisory Council Philip Donne, Campbell Company of Canada John Scott, Canadian Federation of Independent Grocers Perry Caicco, CIBC World Markets Nancy Croitoru, Food and Consumer Products of Canada Tim Berman, Kraft Canada Inc. Mark Ayer, Procter & Gamble Inc. David Wilkes, Retail Council of Canada Chris Terrio, Crossmark Canada Inc. Cori Bonina, Stong’s Market Michael Marinangeli, MIDEB Consulting Inc. © Copyright 2013. All rights reserved. No part of this magazine may be reproduced without written permission of the publisher. GST Registration No. 83032 6807 RT0001 Publications Mail Agreement No. PM42211029 ISSN 1927-243X Mailing and Delivery Address: Grocery Business Media 390 Queen’s Quay W., RPO Box 4085 Toronto, ON M5V 0A4

publishers’MESSAGE TESTING THE WATERS We were tempted to put a giant “Innovation” sticker on this particular issue of Grocery Business. From Target Canada’s sustainability initiatives, to the forward thinking strategies that U.K. retailers are experimenting with, this issue is chock-full of thought-provoking best practices. Deloitte’s Brent Houlden shares insights around retail gamification and how mobile apps can turn a grocery store topsy-turvey by re-organizing it into customer-centric departments. We’ve criss-crossed the country over the past several months attending industry shows where vendors have debuted their latest products. What’s struck us perhaps most profoundly is how industry innovators can invent an entirely new revenue stream from something as simple as a glass of water. Nielsen reports that liquid water enhancers are expected achieve a 43 per cent household penetration over the next few years – and this is from a standing start.

New products have always been the lifeblood of the industry and as the BrandSpark consumer study reports (see page 23), consumers are predisposed to view them very favourably. With new multimillion-dollar product categories being created, and completely new ways for consumers to experience a bricks-and-mortar store, has there ever been a more exciting time to be in retail?

karenjames@grocerybusiness.ca kevinsmith@grocerybusiness.ca @grocerybusiness Sign up for our e-newsletter at grocerybusiness.ca

Grocery Business May | June, 2013 Volume 3, Number 3

contents Yummy Market, Maple, Ontario

DEPARTMENTS 5

Publishers’ Message

Front End

Testing the waters

People and Events

13 Open Mike

Are you getting the “full shop?”

15 Opinion: The Power of

One Voice

29 Shelf Life

Refreshing Beverage Trends

11 6

May | June 2013

70 Launch It, List It 72 It Figures

Nielsen spotlights online shopping behaviour

74 Perry’s Point of View

Predicting retail trends

ON THE COVER

Targeting Sustainability

Target Canada’s Derek Jenkins outlines the retailer’s sustainability strategy

FEATURES 17 Cheese Grand Prix 19 John Scott’s Career Tribute 27 IPSOS: Making an Impression

at Shelf

31 BrandSpark: Lessons

in Innovation

47 Deloitte: Talking Retail Trends 49 Grocery Showcase West

Photo Gallery

54 Networking with the

sustain

Network of Executive Women

ability

55 Canadian Grand Prix Award

Finalists - 20th Anniversary

68 PAC Leadership Awards,

Gold and Best of Show Winners

40 Q &A with three stars of sustainability

42 How sustainable seafood

is making waves

44 Waste not and profit 46 G reening the supply chain

51 Another Yummy Experience

grocerybusiness.ca

May | June 2013

Front End

Appointments Marc Caira, who was global CEO of Nestlé Professional, is now with Tim Hortons as the chain’s new president and CEO. The Association of Canadian Advertisers (ACA) has announced Philip Donne, president of Campbell Company of Canada, as the 2013 recipient of the ACA Gold Medal Award –

which is presented to an individual who has made an outstanding contribution to the advancement of marketing communications in Canada. Alain Brisebois, a 30-year retail industry veteran, has moved from Alimentation Couche-Tarde to RONA as chief commercial officer and executive vice-president.

Canada’s leading fresh fruit & vegetable industry event

FRESH SUCCESS 88 ANNUAL th

THANK YOU! On behalf of CPMA, the organizing committee and the produce industry, we would like to express sincere thanks to all of our sponsors for their support of CPMA’s 88th Annual Convention and Trade Show.

April 17-19, 2013 DIRECT ENERGY CENTRE TORONTO (ON) CANADA Visit 8

Our sponsors are an integral part of this annual event, going above and beyond to assist with the business, social and companion programs, and more. Their active participation ensured that the Canadian Produce Marketing Association’s 2013 Convention & Trade Show was memorable for all.

cpma.ca to see the full list of our sponsors!

May | June 2013

In April, Robert Sawyer, formerly executive vice-president and COO of Metro Inc., became the president and CEO of RONA. Lesley McKeever has joined GS1 as senior vicepresident of industry relations. McKeever has held senior roles at Kimberly-Clark, and Food and Consumer Products of Canada. Mike Lund is now senior vice-president of retail banner management services at McKesson Canada, responsible for businesses such as Drug Trading and Medicine Shoppe Canada. Safeway Inc. has announced that the current president, Robert Edwards (pictured), will succeed CEO Steven Burd who recently retired. Edwards joined Safeway as executive vice-president and CFO in 2004. Matt Salvatore has joined Health Check at Heart and Stroke Foundation, as communications manager. Salvatore’s background includes FleishmanHillard and Hill & Knowlton Canada.

Front End

Michael Shilton was recently named as manager of client services, Canada, at Advantage. Shilton has a six-year CPG background in category management and key account management roles. Mario Plourde has been appointed as president and CEO of Cascades. Plourde has been with the company since 1985, most recently in the role of COO. Carol Christison is the new president and CEO of the International Dairy-Deli-Bakery Association. Christison’s previous role was as the association’s executive director.

PARADOWSKI TO LEAD NEW SUPPLY CHAIN ASSOCIATION Cheryl Paradowski, formerly executive director of the Canadian Grocery HR Council and currently president and CEO of the Purchasing Management Association of Canada, has been named head of the soon-to-be formed Supply Chain Management Association (SCMA). SCMA, subject to membership approval in September, will be created from the merger of the Purchasing Management Association of Canada and the Supply Chain & Logistics Association Canada.

grocerybusiness.ca

BARLOW TO LEAD CFIG AS NEW PRESIDENT AND CEO The Canadian Federation of Independent Grocers (CFIG) chair, Brent Battistelli, and the board of directors have recently announced Thomas (Tom) Barlow as their incoming president and CEO. With more than 35 years of experience in the beverage business, Barlow was president of Coca-Cola’s Canadian operation for over six years and was, most recently, based in the U.S. as Coca-Cola’s senior vice-president responsible for vending and wholesale. “I am very excited to have been chosen to lead CFIG,” says Barlow. “CFIG plays an important role in supporting the independent grocery business in Canada. The independent grocer is an important part of Canadian culture and CFIG members work, live and create jobs in their communities. Building upon a strong foundation to ensure that our members continue to have the opportunity to grow, will be my first priority.” Battistelli said, “I am extremely pleased to have Tom assuming the leadership of CFIG. He’s a proven leader in our industry which will serve our association well.” Barlow will assume his duties as CFIG president and CEO in June 2013, replacing John Scott, who is retiring, having served as CFIG president and CEO since 1991.

May | June 2013

Front End

2013 SIAL Olive d’Or Competition Winners Organized as part of SIAL Canada, the Olive d’Or award recognizes excellence in international, high-quality extra-virgin olive oils offered in the North American market. The winners of the 2013 Olive d’Or competition are: CATEGORIES / PRIZES

GOLD DROP

SILVER DROP

BRONZE DROP

LIGHT

DE PRADO, DE PRADO, PORTUGAL

EL EMPIEDRO, SCA. OLIVARERA LA PURISIMA, SPAIN

OL ISTRIA EXTRA VIRGIN OLIVE OIL, AGROLAGUNA D.D., CROATIA

MEDIUM

IGP TOSCANO FRANTOIO FRANCI, FRANTOIO FRANCI, ITALY

SENORIO DE VIZCANTAR, ACEITES VIZCANTAR, S.L., SPAIN

ORO BAILEN RESERVA FAMILIAR, GALGON 99, S.L., SPAIN

INTENSE

VENTA DEL BARON, ALMAZARA DE MUELA, S.L., SPAIN

PARQUEOLIVA SERIE ORO, ALMAZARAS DE LA SUBBETICA, SPAIN

RINCON DE LA SUBBETICA ALAMODA, ALMAZARAS DE LA SUBBETICA, SPAIN

SUMMER 2013 • NEW YORK CITY June 30 - July 2, 2013

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• A True World Market: 2,400 exhibitors from 80+ countries & regions

• Our industry newest producers: 100+ new-to-market products in the New Brands on the Shelf Pavilion

• Celebrate the most innovative products at the annual sofi™ Awards Ceremony with Keynote Speaker Chef Marcus Samuelsson

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Front End

An Engaging Couple For Paul Howell, of Howell Data Systems, and his fiancé, Yasmin Khan, this year’s trip to Grocery Showcase West in Vancouver held special meaning. With the engagement ring entrusted to a flight attendant until the appropriate moment, Paul surprised Yasmin with a marriage proposal at 35,000 feet. The happy couple are planning their wedding later this year.

Paul Howell, Howell Data Systems, and fiancé Yasmin Khan Karen Kuwahara, President of Nestlé Purina Petcare Canada.

Purina Animal Hall of Fame Honours 2013 Inductees

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May | June 2013

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SCORE / DIE LINE:

Front End

Supporting Goodness Ultima Foods has launched the ïogo, Supporting Goodness program to support community kitchens in Canada. Working with Community Food Centres Canada and The Stop Community Food Centre in Toronto, Ultima unveiled a five-point program that includes donations and financial assistance to community kitchens in Toronto, Quebec, Calgary and Halifax, a marketing campaign, a corporate volunteer program and donating a share of proceeds from the sale of an ïogo cookbook. Pictured (l-r): Nick Saul, president and CEO of Community Food Centres Canada; Gerry Doutre, president and CEO of Ultima Foods; executive chef Lynn Crawford; and Rachel Gray, executive director of The Stop Community Food Centre.

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Open Mike

Are you getting the

“full shop?” By Michael Marinangeli

A loyal customer is a profitable one. These customers are likely to make most of their grocery purchases in your store, resulting in a profitable mix of products in their basket. Unfortunately, we have seen a continual erosion of grocery sales over the past decade as other channels and category killers have ventured into our business.

WHAT ARE THE TOP 10 THINGS THAT THESE RETAILERS HAVE IN COMMON? »» On any day of the week, they are so busy that it’s difficult to find a parking spot.

Today’s loyalty programs are really reward programs and, in my opinion, do little to convert transient customers into “full shop,” loyal clients. Every customer is rewarded for simply showing up and purchasing a product or hitting a specific sales threshold, even if they just cherry-picked the front page of the flyer. Much has been written about how the increase in square footage will outpace market growth over the next few years, and certainly things are going to get worse before they get better. If you are going to rely on a hot front page or ad matching to build a profitable transaction size, you will not achieve the goal of getting the full shop, nor understand why others have successfully eroded your sales. In my opinion, the three retailers that are best at cultivating sustainable customer loyalty, and that continue to outpace the market on building comparable store sales are: Costco, Dollarama, and my neighbourhood deli/bakery.

grocerybusiness.ca

It amazes me how Costco has taken meat, bakery, deli products and cheese, such as Parmigiano Reggiano, and turned them into destination products priced well below traditional grocery retailers. And if Dollarama truly gets serious about being in the grocery business, it will be a formidable competitor with over 800 stores and counting. Similarly, my local deli/bakery is so busy on Sundays that it needs a police presence to control the traffic. Now is the time to act. Make getting the full shop your top priority. Learn from those organizations that still enjoy healthy comparable store sales, and examine what they are doing right. Getting the full shop should be discussed at every Monday morning sales meeting. With the retail landscape getting even more crowded, now is the time to separate yourself from the pack and offer total value every day throughout the store.

»» None of these retailers advertise to lure customers into the stores. »» All of them follow an EDLP program versus Hi/Low pricing. The overall store is priced right. »» They keep it interesting by changing their mix and introducing new in and out products. »» Customers buy what they need, and not because it is on sale. »» They have above-average comparable store sales. »» They buy to sell, rather than sell to buy. »» They are consistent in their value proposition. They know who and what they are, and stick with it. »» They make their store a destination for specific items throughout, and have become a prime destination for seasonal merchandise. »» You never walk out of the store feeling that you’ve overpaid.

Michael Marinangeli is a principal at MIDEB Consulting Inc. and a retailing veteran with more than 40 years of experience. mjmarinangeli@gmail.com

May | June 2013

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Perspective

The power of one By Nancy Croitoru

“One voice can change a room and if one voice can change a room, then it can change a city. And if it can change a city, it can change a state. And if it can change a state, it can change a nation. And if it can change a nation, it can change the world. Your voice can change the world.” –Barack Obama, President of the United States

From manufacturers to retailers, the CPG industry brings safe and trusted products to the homes of Canadians every day

Nancy Croitoru is President & CEO of Food & Consumer Products of Canada. Food & Consumer Products of Canada is Canada’s largest industry association representing the companies that manufacture and distribute the vast majority of food, beverage and consumer goods found on store shelves. Learn more at fcpc.ca. grocerybusiness.ca

While this quotation is in no way an indication of my political biases, it offers some interesting lessons for our consumer packaged goods sector. Lessons that I believe are long overdue if we are to continue to succeed with our advocacy in Ottawa and across the country. With a strong ally in the federal government, and provincial and municipal governments looking for any way to stimulate growth and opportunity, it’s time for us as an industry to begin speaking with one voice. That doesn’t mean one person, one group, or even one actual voice. It means one message. If politicians are constantly receiving disjointed messages from different groups with different proposals for solutions, they usually take the easy way out and do nothing. All too often, when it comes to government attention to our sector, we find ourselves in the shadows of the auto, forestry, mining and aerospace industries. That’s ironic, considering that CPG manufacturers employ more Canadians – 300,000 – than any other manufacturing sector. From manufacturers to retailers, the CPG industry brings safe and trusted products to the homes of Canadians every day. We’re an industry on the leading edge of technology and innovation. We’re a driving force that is propelling Canada’s economic recovery forward.

We are making an enormous investment in the Canadian economy as a whole, and in thousands of communities across the country. By GDP, by sales, by employment – by any measure – we are a significant industry. I truly believe that collaborating domestically, in order to compete globally, is our ticket to success. Our main requests of government are clear: * Regulatory changes to help companies bring new products to market and support innovation; * Tools to help companies improve their productivity and their competitiveness; * Access to markets outside Canada. There are initiatives out there that are moving down the path of one voice. In the GTA, for example, I applaud the Toronto Region Board of Trade for bringing together many stakeholders to push for a regional Food Cluster strategy. This is a step forward because one voice starts by collectively advocating for governments to make investments to support our sector. Large and small companies, both multi-national and Canadian-owned, must come together with a unified message to demonstrate the impact of our industry on the economy and in the lives of Canadians.

May | June 2013

100

THERE ARE

good reasons

TO USE THIS SYMBOL

HERE IS JUST ONE

Canadian Quality “We make every effort to deliver high quality products that contain pure and local ingredients. That’s why we are proud to put the 100% Canadian MilkTM symbol on the packaging of our President’s Choice Ice Cream Shop Flavours, Loads of, and Cream First ice cream brands, as well as on over 50 of our PC brand deli cheeses.”

Ian Gordon Loblaw Companies Limited Brampton, Ontario

For more information, contact Gilles M-Deschênes at Dairy Farmers of Canada Gilles.deschenes@dfc-plc.ca | 1 800 361-4632

Cheese Grand Prix

CELEBRATING CANADA’S

TOP CHEESEMAKERS In the 8th edition of the Canadian Cheese Grand Prix awards, this year’s winners have taken Canadian culture to a whole new level. “It was a celebration of experienced passionate artisans,” says Gilles Deschênes of the Dairy Farmers of Canada. “There were 225 entries this year, with 58 cheeses making it as finalists. Nineteen were chosen as winners in their category and for the first time a cheese from Ontario was crowned Grand Champion. Quality Cheese’s Ricotta was this year’s chosen one.” Quality Cheese, a Vaughan, Ont.-based fourth-generation cheesemaker, was also the first fresh cheese to win the category. Held every two years, the Grand Prix awards showcases Canadian cheesemakers from across the country that are creating cheeses from 100 per cent Canadian milk.

GRAND CHAMPION: RICOTTA, QUALITY CHEESE INC.

The 2013 Canadian Cheese Grand Prix Category Winners Fresh cheese

Ricotta, Quality Cheese Inc.

Fresh cheese with grilling properties

Queso Fresco Cheese, Latin Foods Inc.

Soft cheese with bloomy rind Semi-soft cheese

Le Noble, Fromagerie Domaine Féodal Inc. Tre Stelle Feta Cheese, Arla Foods Inc.

Washed or mixed rind cheese (soft, semi-soft and firm)

Le Mamirolle, Fromagerie Éco-Délices

Firm cheese

Gunn’s Hill Five Brothers, Gunn’s Hill Artisan Cheese

Gouda Swiss-type cheese Mozzarella (ball, brick or cylinder) Blue cheese (various rinds, with or without veining)

grocerybusiness.ca

Grizzly Gouda, Sylvan Star Cheese Ltd. Louis D’or 18 months, Fromagerie du Presbytère Tre Stelle Mozzarella Cheese, Arla Foods Inc. Bleu d’Élizabeth, Fromagerie du Presbytère

Flavoured cheese with added non-particulate flavourings

Applewood Smoked Cheddar, Cows Creamery

Flavoured cheese with added particulate solids and flavourings

Raclette de Compton au poivre, Fromagerie La Station

Mild cheddar (aged three months)

L’Ancêtre Organic Mild Cheddar, Fromagerie L’Ancêtre

Medium cheddar (aged four-to-nine months)

Medium Cheddar, Maple Dale Cheese

Old cheddar (aged from nine months to a year)

Cheddar 1 year, Fromagerie Perron

Aged cheddar (more than one year and up to three years)

Avonlea Clothbound Cheddar, Cows Creamery

Aged cheddar (more than three years)

5 Year Aged Cheddar, The Black River Cheese Company Ltd.

Farmhouse cheese

Grizzly Gouda, Sylvan Star Cheese Ltd.

Organic cheese

Bleu d’Élizabeth, Fromagerie du Presbytère

May | June 2013

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h e

a n a d i a n

e d e rat i o n

A TRIBUTE TO

JOHN SCOTT

THE CFIG YEARS

inside: Showcasing a career of accomplishment The CFIG Associate Membersâ&#x20AC;&#x2122; Council & Board of Directors Salute John Scott

n d e p e n d e n t

roc e r s

John’s CFIG Career of Accomplishment

1991 I

t was 22 years ago, in 1991, that John F.T. Scott was appointed the 4th president of the Canadian Federation of Independent Grocers (CFIG). An economist by profession,

Scott was living in Edmonton, heading up Scott & Fenrich Consultants Incorporated, a consultancy he founded. In that capacity, he consulted regularly with independent and chain operations in Canada and the U.S. Eventually, his company became the western

that you will regret passing up – you’ll always

representative for CFIG, a condition on which

say to yourself: ‘I should have done that’.” As it

a group of Alberta independent grocers insisted

turned out, she was right to encourage him. Scott

before they would agree to join the national

accepted the job, and has never looked back.

organization.

Throughout his career, he has been

When CFIG president Anthony G.

involved in a number of industry and

Wilshaw was diagnosed with cancer in 1990,

government initiatives, and has chaired several

the organization asked Scott to step in as

boards. He is currently chair of the board of the

a temporary replacement. For six months,

acclaimed Vineland Research and Innovation

Scott continued to operate his own business

Centre, a position he will continue to hold after

in Edmonton and CFIG in Toronto. When

leaving CFIG.

it became apparent that Wilshaw would not

But among his many accomplishments,

recover, the CFIG Executive asked Scott to

Scott is most proud of the many and deep

take the job.

relationships that have been cultivated among

Scott refused, but when he told his wife

CFIG members and suppliers (see sidebar).

Michelle, she said, “This is an opportunity

INDUSTRY SURVIVAL GUIDE John Scott’s prescription to keep the independent grocery industry healthy.

• Facilitate information sharing: “We have a few share groups, but we need them to expand, to get the Americans involved, and do more specific things like human resources or inner-city groups. There are all kinds of opportunities, and CFIG has a vital role to play. While public policy and being at the industry

table are both very important, the most significant and beneficial contribution that CFIG can make in the next five years is to focus on maximizing the distribution of information to its members so they can truly capitalize on obvious opportunities.”

2013

“ I always felt like I was doing a decent job based on my passion for the independent, but to be honoured with the Golden Pencil is still very overwhelming.”

In 2009, he received the Golden Pencil

Besides doing some speaking engagements

Award, the highest honour bestowed by the

and what he calls a “limited amount” of

retail food industry in Canada. “It was probably

consulting, he plans to indulge his passion for

one of the biggest things in my life after my

gardening, taking the time to not only prune the

wife and kids,” he enthuses. “I never felt that

roses but to smell them too! Higher education

I needed an award for validation, and I was

may also be on the agenda. “While I may not be

extremely surprised to receive the designation. I

sitting in this office anymore, I certainly do not

always felt like I was doing a decent job based on

plan to disappear,” he says. “I guess in essence

my passion for the independent, but to receive

it’s called semi-retirement, and I think the plans

this recognition by my peers; to be one of the

we have made will suit me very well.”

very few people who have been honoured with the Golden Pencil is still very overwhelming.” Scott plans to keep active – in more ways than one – after his retirement from CFIG.

IN HIS OWN WORDS

As he assists his successor with the

His greatest achievement:

transition, he looks forward to shaking hands at

“ The development of the various

the 2013 Grocery Innovations Canada with all

relationships among and within CFIG.

those who have supported CFIG.

CFIG is now relationship-based; I often refer to it as the ‘CFIG Family.’ It’s a very tight unit of people, and we’ve managed

to integrate the supply community with the independent grocery retailer. I’m not sure if everyone realizes how unique and special that is – but – believe me, it’s worth holding on to as CFIG moves into the future. It truly defines who you are, is respected, and makes CFIG stand out

above the crowd.”

• Educational resources: “CFIG needs to facilitate greater educational resources for our members. Our members need to go to school particularly on the Americans. We’re hoping to have reciprocity with NGA to gain access to some of their university courses. CFIG

members need to take advantage of that to sharpen their skills; they need to know what’s going on; and they need to be able to learn from the resources that are available to them. And we at CFIG need to communicate that information in a much better way.”

(adapted from “John Scott: the Exit Interview,” by Dan Leggieri, Manager, Communications, Canadian Federation of Independent Grocers)

1. CFIG Associate Members’ Council pays tribute to John, at 2012 Grocery Innovations Canada. 2. John joins the pipers to open Grocery Innovations Canada. 3. The Best Bagger competition at Grocery Innovations Canada. 4. John, Lyle Van Clief, Federal Minister of Agriculture (1997-2003), and Peter Knipfel, Chesley Grocery Store, on the floor at Grocery Innovations Canada. 5. Michelle and John Scott in “Happy Days” attire.

A Salute to John Scott from

hen John F.T. Scott announced his impending

SCOTT MITCHELL Owner Market Street Vulcan Vulcan, Alta.

retirement from the position of president and

CEO of the Canadian Federation of Independent Grocers

My best memory of John is how much

after 22 years, his colleagues from the CFIG Associate

he enjoys playing golf and collecting

Members’ Council and the Executive Committee decided to

his other golf partners. I think we’re

pay tribute with their favourite memory of John and their

get my $20 back!

those signed $20 bills from me and funding his retirement. My goal is to

thoughts on his most significant accomplishments. John’s greatest accomplishment, I think, is being able to bring the industry, retailers, and government together to recognize that the independent grocer is vital to Canadians.

DAVE POWELL President and CEO Powell’s Supermarket Ltd. Bay Roberts, NL

KEN SCHLEY Co-owner, Quality Foods Qualicum Beach, B.C.

My best memory is of the Summer Meetings, where John sang and played his guitar. He really relaxed at these meetings and it was good to see.

here are many amusing memories, but probably the one that sticks out most, and which John reminds me of every opportunity he gets, is the first time we met. That was

21 or 22 years ago. John and the president of CFIG at the time made a trip to Newfoundland trying to drum up more members. I was working in the warehouse, helping offload by hand a full trailer load of potatoes, and was quite tired and maybe a little bit edgy. John was trying to talk to me about the merits of CFIG, and as John recalls it, I basically kicked him out – told him I wasn’t interested, that CFIG had nothing to offer me, and get the hell

John’s done a lot for CFIG, and there are so many accomplishments that it’s hard to pick just one. But mainly, I really like how he supported the independent grocer; John was truly our best representative.

out of my warehouse! John was persistent, though, and a couple of years later, we had time to sit down and have a good, hard look at the merits of CFIG, and of course, we joined. John’s greatest accomplishment was getting across the point of view of the independents to both industry and government, and ensuring that our concerns were considered.

1982 JOHN SCOTT TRIBUTE: MILESTONES

Sponsored by

John’s musical genius as he crafted many comical and priceless lyrics around the goings on of the board and AMC at various events. John’s dedicated commitment and focus in bringing together the AMC and CFIG board to better understand the independent channel and find ways to drive the most value out of the collaboration.

the Associate Members’ Council

STEPHEN KOURI Vice President Sales & Trade Marketing Smucker Foods of Canada Corp.

MARK AYER Vice President Customer Business Development Canada Procter & Gamble Inc.

My favourite memory is looking at John at the 2012 CFIG Awards Gala as we stood on the stage and watched the words on the teleprompter race at warp speed across the screen as I was presenting an award. It wasn’t funny then, but it is now, and he handled it all very well.

John is good luck. Every time I have golfed with him, someone has gotten a hole in one. There are so many, but I will always remember John as a tremendous advocate for the independents and for the impact he had on people in our industry.

Making the CFIG very relevant with all its key constituents – including the leading suppliers in the industry.

ohn was the visionary and catalyst of change for CFIG that raised its profile and influence across our industry, government, and in every independent store across the country. He brought his passion, insight, and strength to the independent grocer, focusing them on a future of success as the retail landscape changed around them.

BLAIR RUELENS Vice President National Sales Pepsico Foods Canada

DEAN YUZDEPSKI Vice President Operations and General Manager Weston Bakeries Ltd.

It’s fun watching John blush when Michelle calls him “Babe.” JOE WEBER National Vice President Retail Dairy Sales Saputo Canada

For years, we enjoyed knowing John as a “folk singer” as he pulled out his “Geetar” to host and entertain the “CFIG Family” at Summer Meetings and Christmas parties. At a time when many industry associations are collapsing, CFIG continues to grow. John built a team and a culture that had a vision and focused on the big picture.

J.D. ROBICHAUD Vice President, Sales, Campbell Company of Canada

John is the ultimate professional who is passionate about the independent grocery retailer. He cares deeply and has done so much, as highlighted in the 50-year book that celebrates the entrepreneurs that are his members.

In my view, one of John’s greatest accomplishments has been his ability to bring independent retailers and manufacturers together. He has created a platform that works.

ohn singing, playing guitar, and stamping an “ugly stick” at our meeting in St. Andrews. An ugly stick, he said, is from Newfoundland, and it’s got cymbals on it. So John was a one-man band – playing his guitar, singing and stamping his ugly stick. There are many, but I think continuing to build the voice of the independent grocer in Canada and developing CFIG into what I think is the best association across any industry. In doing so, John has brought the independent grocer’s voice to the very top levels of government and industry.

DOUG MCGILLIVRAY Vice President Sales General Mills Canada Corporation

h e

a n a d i a n

e d e rat i o n

n d e p e n d e n t

roc e r s

Making an

IMPRESSION At Shelf

by Catherine Yuile

We know that many Canadians at the grocery store are rushed, overwhelmed, and would much rather be doing something other than their weekly chore. And being impulse and price sensitive means Canadians are making the most of their brand purchase decisions in-store. Clearly, the impression your brand makes at shelf is vital. One of the biggest reasons advertising fails to work across

touchpoints is because of weak brand linkage. In other words, consumers either don’t recognize or remember the brand that the message and creative are talking about. Ipsos ASI’s in-store testing experience reveals that there is a strong correlation between brand name clarity and closing the sale. This means that the name must be so clear that EVERY shopper will get what brand the ad or package stands for.

1 WHY DO BRAND COMMUNICATIONS FAIL AT SHELF? 3

50% WEAK BRAND LINKAGE 25% IRRELEVANT/NON-DIFFERENTIATING 15% NO NEW NEWS 10% DULL/BORING

THE ROLE PACKAGING PLAYS Ipsos Reid’s packaging learnings suggest that stand-out at shelf is affected by two things: • marketing presence • design quality

Plus, the number of facings (shelf presence) of a pack and the higher your brand’s familiarity, the more positive the impact of your product at shelf.

THE IMPORTANCE OF TYING IN-STORE CREATIVE TO AN INTEGRATED MARKETING CAMPAIGN There is no doubt that in-store materials best communicate the brand when they tie into other touchpoints, working together to build ongoing brand associations and resonance. Branding, messages and visuals that are consistent across media and packaging act as a familiar cue to the brand and can increase the stopping power of in-store communications.

grocerybusiness.ca

Branding has the most positive effect on shelf standout if: • There is an obvious and unique branding device

• The brand name is large and in a colour distinct from the rest of the package and from the rest of the category

• The more distinct the colour and shape are, the brighter the colour is, and the simpler the design, the more chance your product has of standing out at shelf.

AND TO IMPROVE YOUR BRAND’S IMPRESSION ON SHELF: • Ensure in-store communications on displays or at shelf are consistent with other elements of an integrated marketing campaign and offer a relevant and differentiated proposition to consumers.

Source: Ipsos ASI

GOOD TO KNOW!

• Ensure the product’s packaging is unique and contains an obvious brand device that is distinct from the rest of the category. • Use bright distinctive colours and shapes coupled with simple, easy to digest design to ensure the brand stands out from competitors

CATHERINE YUILE is a senior vice-president with Ipsos ASI, leading the client service team overseeing pre-testing and in-market tracking. Catherine is Ipsos ASI’s global expert on ad transferability across borders.

May | June 2013

Kraft Makes a Splash with &

Consumers can now flavour their water on the go with MiO and Crystal Light Liquid water enhancers. Flavoured water isn’t new, but flavouring water

These innovative products

with a concentrated liquid water enhancer that

capitalize on the growing trend of

allows the consumer to control just how much

customization, especially popular

or how little is new. MiO and Crystal Light Liquid

with the Millennial target group,

take water enhancement to a whole new level.

who seek out and embrace change. Millennials want products and

services their own way, whether it be shoes, music, clothes – or water. And with their busy lifestyle, they want to quench their thirst on the go, so MiO and Crystal Light are a perfect fit.

Exceeded internal growth targets by

In 2012, MiO exceeded internal growth targets by 350%, grew the category by double digits, and changed the way people drink water. MiO Sport

350%

HOW CAN YOU

MAXIMIZE

YOUR LIQUID SALES THROUGH

MERCHANDISING? • Big displays bring presence to the brands and drive in-store impact so merchandise in bins and clip strips in the water aisle • Merchandise at the front of the store and around the perimeter to intercept Millennials where they are shopping

*80 mg of sodium and 40 mg of potassium per 2.7 ml.

with electrolytes*, new MiO flavours, and Crystal Light Liquid launches are exciting innovations that Kraft anticipates will bring more great results.

Refreshing TRENDS By Noelle Stapinsky

Over the past few years, retailer’s juice and isotonic aisles have undergone quite the exotic and complex makeover. Along with traditional pure juice options, there’s now sparkling juices, exotic and unexpected superfruit blends, coconut waters, water enhancement products, and fortified and functional beverage offerings, all catering to a consumer demand for healthier options in the refreshment category. Canadian consumers young and old are on a quest to quench their thirst with low calorie, natural sweetened beverages, while getting their daily dose of fruits and vegetables. And while juice has always remained a breakfast staple in households across the country, many are turning to the juice aisle for refreshing concoctions to offer when they entertain. According to a Euromonitor report, the global market for fruit and vegetable juices is expected to reach over 72 billion litres by 2017 – a growth that will be driven by the rising demand for organic, superfruit and 100 per cent natural juices.

Thirst Quenching Coconut

Interestingly, many companies are coming out with coconut beverages or blends, which has become one of the beverage category’s fastest growing trends. Known for its hydrating properties, coconut water is actually classified as a juice but with a far lower calorie content. And beverage makers that want to keep their 100 per cent pure juice labelling are jumping on this handy libation to reduce the calories in their blends. This coconut craze isn’t just a fad. The translucent, fat-free liquid that’s packed with potassium and magnesium has exploded globally. Coca-Cola’s ZICO Pure Premium Coconut Water was the official coconut water at the London Olympic Games last year, and many big beverage manufacturers have been jumping on board – PepsiCo introduced O.N.E. Coconut water in 2012.

Super Sales

Superfruits burst on the retail scene only a few years ago, but today, fruit beverage blends of pomegranate, acai berry, cranberry and coconut, to name a few, have become common items on household shopping lists. Consumers are drawn to these exotic flavours for their antioxidant rich health benefits.

19.2%

According to Nielsen MarketTrack, category sales of these new liquid concentrates have increased by 19.2 per cent in the last year.

H2 Oh

Water enhancement products have quickly become a star in the beverage mix category. Kraft Foods launched its MiO liquid water enhancers about a year ago and just last September, Coca-Cola came out with Dasani Drops. Just this year, Kraft also launched its Crystal Light water enhancement product in a new liquid format with four SKUs – Strawberry Lemonbabe, Iced Tease Me, Blueberry Razz and Mango Passionate. “Flavoured water isn’t a new idea, but flavouring your water with a concentrated liquid enhancer that allows the consumer to control how much or how little they want to add is new.” Kathy Murphy, director of corporate affairs for Kraft Canada.

$3.8

$6.5

$10

BILLION

2007

2012

2017

BILLION

From 2007 to 2012 superfruit juice sales jumped from $3.8 billion to $6.5 billion in global sales, according to a Euromonitor report. And by 2017, it’s expected that the market will be worth $10 billion. grocerybusiness.ca

May | June 2013

Real chicken or turkey is the #1 Ingredient.

WINNER of a Best New Product Award, 2013 To our valued retail customers, thank you for contributing to the success of Purina ONE Purinaone.ca TRADEMARKS OWNED BY SOCIÉTÉ DES PRODUITS NESTLÉ S.A., VEVEY, SWITZERLAND

CPG Innovation

LESSONS

IN INNOVATION 1

The competitive importance of innovation, not just in the fast-moving world of tech products but also in consumer packaged goods, has increased in the past 10 years. As more brands compete for the same consumer dollars, and retailers expand their private-label categories and often improve their offerings, product innovation has become essential for brands to remain ahead.

Consumer interest in what’s new has been stable these past 10 years with eight in 10 consumers consistently agreeing that they like to try new products, and nearly seven in 10 saying they will pay a little more for an improved new product. We have seen over the years, by reading hundreds of thousands of consumer testimonials, that having the product deliver a meaningful benefit is crucial.

Canadians appreciate “new” for a variety of reasons. In food, new products often feed a desire for variety and exploration. In personal care and household products, consumers believe that research and development usually leads to better products. We have seen continued interest in products being made more natural, as long as they don’t lose their effectiveness.

As baby boomers age, marketers have been able to tap into a whole new range of anti-aging skin-care products with a huge variety of benefits. This, coupled with Canadians’ strong desire for maximum value for money, has also driven innovation – especially in the Beauty arena. We see brands such as Olay and L’Oréal delivering high-quality beauty and cosmetic products with highimpact packaging and the pricing and convenience of drugstores and supermarkets. grocerybusiness.ca

Reflecting on their 10 years of studying consumer purchasing preferences, Robert Levy and Philip Scrutton of BrandSpark International share their thoughts on innovation over the years.

Breakthrough products Many of the breakthrough products of the past years are those that consumers have rated as the most innovative. Such products include the all-in-one Tide Pods, Mr. Clean Magic Eraser, Off! Clip-On personal insect repellant, and Astro Zero SuperBerry Yogourt. These innovations have the greatest potential to shift the market and attract new consumers to the brand, or even to the category. But many other successful new products are not what we consider particularly innovative. For example, consumers voted Gain Sunflower and Sunshine best new laundry detergent on the strength of an appealing new scent. Similarly, consumers did not rate Dr. Oetker Ristorante Pepperoni Pesto as innovative, but said it delivered great taste. The key is to offer meaningful incremental new benefits, while maintaining the value that is a must for shoppers. Retailers also drive the push for new products: Manufacturers are often more successful in getting shelf space for their new products, while older SKUs are gradually pushed off the shelf. We have also seen that

% of consumers who believe that new products are often better

HOUSEHOLD CARE PRODUCTS

HEALTH PRODUCTS

66%

59%

FOOD PRODUCTS

PERSONAL CARE PRODUCTS

57%

Specific product claims are a primary influence on purchase of new products along with brand experience, price and promotion Previously purchased the brand Claims made on pack or in ads Price Discount sale or coupon offered Recommendation of friends/family Saw in flyer/prominently displayed Packaging design Sample offered

41% 31% 25% 17% 14% 14% 14% 7%

2013 May | June 2013

2011 31

速

THE & O ONE NLY

A VARIETY N I E L B A L I A S AV OF FLAVOUR

T order To d or ffor more iinformation f ti contact your Clorox Company of Canada sales representative.

CPG Innovation

Keeping it creative

For the most consistently innovative CPG companies, innovation is a part of the culture, and involves a long-term commitment to understanding and meeting the needs of consumers. These companies maintain a wide perspective on consumer trends within and outside their categories. products than keeping it. They sometimes get off to a great start only to fall off in years two and three when they face pressure from other new products. So marketers should be able to identify those products that have real longer-term potential and continue supporting them in years two and three, while letting those with lower potential fall by the wayside. For example, some marketers have found that winning and promoting a Best New Product Award can help sustain and even propel sales in this critical period in the product life cycle. Retailers have also seen the benefit of updated products on sales. A great selection of new products has become a competitive point of differentiation among top banners in Canada, including Walmart, which partnered with the Best New Product Awards.

TA S T E T H E F U T U R E 10 specialized trade shows under one roof Cologne, Oct. 05 – 09, 2013 | www.anuga.com

Shoppers’ interest in new products remains high, as does willingness to accept others’ recommendations (Ranked by %Completely Agree/Agree)

I LIKE TRYING NEW PRODUCTS

Charts Source: BrandSpark Canadian Shopper Study

76% 78% 73% Buy your admission ticket online now and save up to 42 % !

I AM LIKELY TO BUY A PRODUCT THAT IS RECOMMENDED BY OTHERS

67% 71% 61% 2013

2012

Koelnmesse, Inc. 8700 W. Bryn Mawr Ave., Ste. 640N Chicago, IL 60631, USA Phone +1 773 326 9922 v.woods@koelnmessenafta.com www.koelnmessenafta.com

2011

grocerybusiness.ca AN13_114x184_CAN-Grocery Business.indd 1

May | June 2013

07.05.13 12:13

Congratulations Award of Excellence

Andrew & Emily’s No frills

Hurley’s YIG

Morello’s YIG

Stewart’s Town & Country Market

Platinum

Andrew & Emily’s No frills

Food Basics #638

Food Basics #654

Hurley’s YIG

Longos Brothers Fruit Markets Inc. Burlington

McDaniel’s YIG

Metro #73

Metro #325

Metro #479

Morello’s YIG

Sobeys #685

Stewart’s Town & Country Market

Loblaws Forrest Hill

Metro #395

Retailer AwardWinners

Foodland Ontario

Vision Award

he 25th annual Foodland Ontario Retailer Awards Ceremony recognized 32 grocery retailers for their in-store promotion of fresh Ontario food. The displays increase

consumer awareness and education about the variety of fruits and vegetables grown in the province. Stores submit photographs of their promotional displays to qualify for the awards. There are five award categories that recognize the support for promoting Ontario’s

local food in season. From individual store displays to overall retail banner endorsement, the Retailer Awards program is a true celebration of our Retailer’s commitment to sourcing local food because of the difference it makes to our farmers and our economy. If your grocery store promotes local food and you would like to participate in this program, please contact Barb Smith, Supervisor of Retail Services at barb.smith@ontario.ca

Longo Brothers Fruit Markets Inc.

Metro Ontario

Gold Creative

Allan’s YIG

Fisher’s YIG

Food Basics #620

Longos Brothers Fruit Markets Inc. Woodbridge

Gold Cross Merchandised

Food Basics Listowel

Metro #124

Metro #147

Woodstock Foodland

Gold Seasonal Harvest Barn Country Market was unable to attend the ceremony.

Metro #141

Victoria Harbour Foodland

Zehrs Great Food #529

TYPE

MODULAR

TYPE

COMPACT

FLEXIBLE, ADAPTABLE, UNIQUE

CONVENTIONAL, STYLISH, MODERN

With K-class flex, screens, load cell, printers, etc. can be freely combined resulting in space-saving integrated solutions for your merchandising cases with all the technology features of the KH100.

Applesque design counter scale with the cutting edge Bizerba K scale App designed to inform your operator so the customer feels like they are talking to a foodie or a chef. Not to mention industry leading application integration and power savings backed by Bizerba workmanship.

K-FLEX

KH 100

Retail Portfolio: High performance with a wide range of different models and equipment variants.

A TRADITION OF INNOVATION. Bizerba has been focused on weighing technology since 1866. We provide state-ofthe-art PC Based Scale Hardware and Software solutions for full-service and pre-pack departments with a primary focus on increasing your sales and profits. Closer to your business, flexible for your needs, ready for the challenges of a global economy. www.bizerba.com

sustain

ability

TARGETING

SUSTAINABILITY By Karen James

IN TARGET’S FIRST GROCERY INDUSTRY INTERVIEW, DEREK JENKINS, SENIOR VICE-PRESIDENT OF EXTERNAL AFFAIRS, MET WITH GROCERY BUSINESS TO OUTLINE THE COMPANY’S SUSTAINABILITY OBJECTIVES AND HOW, WITH SPECIFIC INITIATIVES, CANADIAN STORES ARE TAKING THE LEAD.

grocerybusiness.ca

May | June 2013

sustain

ability

Q&A Target recently announced a comprehensive plan outlining its sustainability objectives. Can you please describe them? We have a set of global sustainability commitments with country-specific goals. The sustainability objectives outlined below are our U.S. teams’ objectives. However, for Canada, seeking LEED certification for all 124 Canadian stores is a priority for 2013, as these will be our most sustainable collection of stores. Given this is our first year in Canada, we are using this year to develop a baseline for our operations and to listen to our guests to understand what’s important to them and how we can make small changes that can add up to a big impact. Having said that, our sustainability commitments include:

DEREK JENKINS SENIOR VICE-PRESIDENT, EXTERNAL AFFAIRS, TARGET CANADA

As senior vice-president of external relations for Target Canada, Derek Jenkins is responsible for helping Target build and sustain relationships that support its team members, guests, shareholders and communities in Canada. Derek joined Target in 1994 as a store team leader and has held several positions throughout his Target career, including senior vice-president of store operations, where he was responsible for company best practices, communications and measurements. Prior to his current appointment, Derek was a regional senior vice-president of Target Stores, where he led a team responsible for nearly 500 stores in the New York, Boston, Washington, D.C, and Philadelphia areas.

May | June 2013

BORN: Naples, Italy. Because his father was in the U.S. Navy, Derek’s family moved frequently, eventually settling in Norfolk, Virginia. EDUCATION: Holds a bachelor’s degrees in management and management information systems from Appalachian State University in North Carolina. COMMUNITY SERVICE: Derek feels strongly about providing youth and adults with the chance to experience life’s possibilities. He sits on the following boards: The Brooklyn Academy of Music, the Rush Philanthropic Arts Foundation, and the Philadelphia Freedom Valley YMCA. He is also a member of the Executive Leadership Council. PERSONAL TIME: Enjoys family life with his wife and daughter and staying fit by running and lifting weights.

Sustainable Living: Empowering our guests and team members to lead a more sustainable lifestyle by providing the right information, tools and incentives. Sustainable Products: Expand our selection of sustainable product choices that balance price, performance and convenience. Smart Development: Be a retail leader in smart development by creating buildings that use space more efficiently, improve connectivity for guests and team members, and enhance local communities. Efficient operations: Achieving milestones in our business by using resources responsibly, eliminating waste and minimizing our carbon footprint. LEED certification for all your Canadian stores by the end of 2013 is ambitious. How do you see this rolling out? Target Canada stores will be among the most sustainable collection of stores to date as we seek LEED certification for all 124 stores opening in 2013. We have many different initiatives; for example, the

sustain

ability refrigerator cases in our stores have been outfitted with LED lights and motion sensors designed to illuminate only when a guest walks by. Target has incorporated environmental sustainability into its business strategy for more than three decades, installing rooftop solar systems, converting to energy-efficient light fixtures, and adopting other initiatives that have earned us ENERGY STAR certification in more than 100 stores. And Target is part of the U.S. Green Building Council’s Volume Build, which is designed to help streamline the certification process for multiple buildings, making us a leader among Canadian mass retailers when it comes to LEED buildings. You’ve made a sustainable seafood commitment and are engaged with FishWise on this program – will this commitment be in effect in Canada as well? In 2011, Target committed to selling only sustainable and traceable seafood by 2015. We think that our sustainable seafood commitment is an important one, and we’re currently investigating options for Canada. We like the fact that Target positively rewards its guests by reducing their bill by five cents when they bring their own bag. How has Target’s plastic bag usage been impacted by this program? Given that we have been open for just a few months in Canada, it’s too early to say. However, since the launch of our U.S. reusable bag program in 2009, more than 80 million reusable bags have been used. We’ve saved the equivalent of 200 million plastic bags from potentially ending up in landfill.

open in Ontario. In addition, select locations in the Greater Toronto Area – Square One Mississauga, Brampton Trinity Common Mall, Newmarket, and East York – sampled free, sustainable and organic products from their Health, Beauty and Grocery sections. Through sampling, we’re hoping to encourage guests to experience Target’s selection of sustainable products, such as Green Works, Burt’s Bees, and our Archer Farms Fair Trade coffee. Target has a program to reduce the packaging impact of its store brands; do you see the programs affecting branded products as well? Packaging reduction has been a focus for us, as well as for many of our national vendors for the past few years. Consumers are growing increasingly aware of over-packaging and its burden on waste and recycling systems. In addition to packaging reductions, Target has a recycling program with four bins in every store to accommodate: trash; beverage containers of aluminum, plastic, and glass; plastic bags; and electronics such as MP3 players, cellphones, and ink cartridges, which are refurbished or recycled. Target has won numerous awards for its sustainability and corporate responsibility activities. What areas do you intend to focus on in Canada?

Smart design leads to smarter solutions for our guests and the environment, and that includes building energy-efficient stores and developing sustainable products

While we are still working to confirm our specific areas of focus for Canada and set our environmental goals, our commitment remains the same. Smart design leads to smarter solutions for our guests and the environment, and that includes building energy-efficient stores and developing sustainable products.

Target was a founding sponsor of Earth Day back in the 1970s – how did you celebrate in 2013? This year, Target celebrated Earth Month by giving more than 100,000 reusable bags across all 24 stores

grocerybusiness.ca

May | June 2013

sustain

ability

Q&A

WITH THREE STARS OF SUSTAINABILITY

HELMI ANSARI

We shouldn’t do “good” only when we do “well,” but we should do “well” by doing “good.”

Director Sustainability and Productivity PepsiCo Foods Canada Mississauga, Ont.

What attracted you to sustainability as a career? When my manager asked me to take on the sustainability portfolio, it caught me off guard and my initial thoughts were that I already had a full plate. But not a day has passed that I haven’t been grateful for the opportunity to do what I do, and the tremendous internal and external support in our journey, as well as my personal growth in this field. What do you consider the most innovative sustainability program within your organization? We’ve done many things on this front, such as using the natural

May | June 2013

water inside a potato to make potato chips, to running a large business like PepsiCo Foods Canada with its eight plants and multiple distribution centres while sending less than one per cent of our waste to landfills. What professional sustainability achievement are you most proud of? Perhaps what gives me the most personal pride is that I have been able to inspire others – both inside and outside our company – to incorporate considerations of sustainability into their daily lives and careers.

What’s the next big thing that companies will be facing in the area of sustainability? It can be challenging to meet the needs of shareholders while operating with a sense of purpose. At PepsiCo, we call this Performance with Purpose, a mantra our CEO has led us towards over the past several years. We shouldn’t do “good” only when we do “well,” but we should do “well” by doing “good.”

sustain

ability JOHN D. COYNE Vice-president of Legal and External Affairs Unilever Canada Inc. Toronto, Ont.

BETTY BEUKEMA What attracted you to sustainability as a career? Sustainability has evolved to live in all of our careers. I recognize that my work must properly reflect business strategy, but also a broader social and environmental agenda of issues and, importantly, solutions. As an advocate of our Unilever Sustainable Living Plan, and an external representative for the company, sustainable living is the central feature of our business strategy and the long-term vision for the success of Unilever globally. Our 10-year strategy is to double the size of our business while simultaneously cutting in half our environmental footprint.

The next big thing for companies in the area of sustainability is going to be the challenge of collaboration to create meaningful change.

grocerybusiness.ca

What do you consider the most innovative sustainability program within your organization? For an organization with the reach and scope of Unilever, our programs are far-reaching. For example, there’s Dove and the Self-Esteem fund, Becel and its work on heart health in addition to our overall efforts to reduce CO2 emissions throughout our supply chain. What professional sustainability achievement are you most proud of? In Canada, we have taken great pride in the fact that all facilities are now powered with green, renewable electricity. In fact, Unilever is the largest commercial purchaser of green electricity in the country. What’s the next big thing that companies will be facing in the area of sustainability? It’s going to be the challenge of collaboration to create meaningful change. No one company, country or institution can tackle the significant challenges that confront us locally and internationally.

Director of Retail Services Overwaitea Food Group Langley, B.C.

What attracted you to sustainability as a career? What attracted me and continues to attract me to sustainability initiatives is that it resonates with my values of being a good steward of the resources that we’ve been given. What do you consider the most innovative sustainability program within your organization? It’s difficult to pick just one as all of Overwaitea Food Group’s (OFG) sustainability efforts are great examples. But if I had to choose one of them, I’d say the cycle of organic cull from our stores that’s converted into our private label potting soil - this meaning less waste in local landfills. What professional sustainability achievement are you most proud of? What I am most proud of is being associated with a company that is forward-looking and innovative while considering the environment in their decision-making process.

We are seeing the global impacts of waste from production processes.

What’s the next big thing that companies will be facing in the area of sustainability? There are two main things: water and waste. Water, because there are pockets of the world that have a shortage. And we are seeing the global impacts of waste from production processes.

May | June 2013

sustain

ability

SEAFOOD

GO-TO-MARKET STRATEGIES

10 TIPS By Dana McCauley

Although manufacturers and grocers are investing time and money in developing new fish and seafood products and programs that promote sustainability, Nielsen’s 2011 Global Online Environment & Sustainability Survey reveals that only 12 per cent of Canadian consumers are willing to pay more for eco-friendly products. Yet, 91 per cent of 1,278 Canadians polled by the World Wildlife Federation (WWF) indicated it is important that fish and seafood sold in Canada come from sustainable and non-over-fished stocks.

1 ONE

PRODUCT KNOWLEDGE Ensure your staff understands and can communicate clearly the benefits and claims on all seafood packages and programs.

4 FOUR

6 9

EXPERT INSIGHT Consider hosting consumer events where independent sustainability experts can inform consumers about the various programs cited on packaging.

CREATIVE PACKAGING

SIX

Highlight the sustainable fish options in your fresh counter with distinctive merchandising. Likewise, consider giving purchasers of sustainable seafood reuseable shopping bags that aren’t available to other shoppers.

NINE

2 TWO

Additional WWF research found that mere a eight per cent of Canadians feel well informed about where fish products are sourced. Clearly, to satisfy today’s sustainable fish shopper, grocers need to prove that their fresh, frozen and canned offerings not only truly deliver on a sustainability promise but that these products also provide competitive value. How can grocers communicate the features and benefits of their sustainable seafood choices to the 92 per cent of under-informed consumers? Try some (or all!) of these tips and watch sales and store loyalties grow.

PRICE TRANSPARENCY

5 7 FIVE

Create ways to communicate and share sustainable seafood news to consumers using Facebook, Twitter and other social media accounts specifically focused on sustainable seafood.

ROLL OUT INFO

SEVEN

The back of register receipt tapes can be used to promote and educate customers about sustainable seafood and other greener choice products.

BACK-TO-SCHOOL Nurture a generation of sustainable seafood ambassadors by inviting local teachers to bring their classes to your store to learn about sustainable fish.

May | June 2013

THREE

SOCIAL MEDIA

10 TEN

Resources: www.theglobeandmail.com/life/home-and-garden/spring-cleaning/canadians-balk-at-buying-green-for-more-money/article4106823 www.wwf.ca/conservation/oceans/sustainable_seafood/canadians_want_sustainable_seafood

Consumers assume that sustainable seafood products are more expensive than other options when often they aren’t. Highlight value where you can and make it clear to consumers when prices include donations and other charitable programs built into the shelf price.

8 EIGHT

COMMUNICATE Shelf talkers, QR codes, pamphlets and other in-store materials that offer consumers more information about the programs and features of frozen and fresh seafood selections will buoy consumer confidence in sustainability claims.

LOYALTY Take a page from coffee chains and create a frequent buyer program for the sustainable fish and seafood purchaser. Reward their conscientious shopping choices once the card is filed by making a donation in their name to a non-corporate organization that supports sustainable seafood.

CREATE URGENCY Set a goal to sell a certain amount of sustainable seafood in a specific time period. Highlight the progress on a regular basis with flyer, website, in-store, and social media attention to maintain momentum and generate excitement.

Dana McCauley is the vice-president of marketing for Plats du Chef and a judge on the FoodNetwork Canada series Recipe to Riches. Get her innovation tips on Twitter: @DanaMcCauley

sustain

ability

“SEAS”

THE OPPORTUNITY VALUE-ADDED SUSTAINABLE SEAFOOD IS MAKING WAVES

MERCHANDISING TIPS

By Noelle Stapinsky

Whether they’re shopping for a single-household or a family unit, health-conscious consumers are looking to fill their baskets with healthy and convenient alternatives for protein, attracting a whole new set of shoppers to the seafood department. And the value-added sustainable seafood category is gaining popularity for its ease of preparation and, of course, all the tasty glazed, marinated or saucy options. “With value-added seafood, we’re opening the door to a group of customers that may not feel comfortable preparing seafood at home, while also attracting a consumer base that may not typically shop for ready-meal solutions but are open to the concept in a seafood format,” says Jeff Duffin, vice-president of marketing for Clearwater Seafoods. “It also provides an alternative protein for the time-crunched customers.” And while savvy consumers are becoming Canadians are increasingly tuned in to consuming more environmental issues, fish and seafood there still remains a lack of understanding of 7.6% overfishing and the 3.9% long-term implications, and how to recognize sustainable seafood 2004 2019 (est) options. % of household food By providing the choice expenditure of Marine Stewardship Source: Statistics Canada. Council (MSC) certified July, 2010 fish and displaying the logo on the pack, the choice is made easier for discerning customers.

grocerybusiness.ca

Seafood can be a tough category to merchandise so we went to the experts for their suggestions:

To better merchandise value-added products, Clearwater suggests strategies such as call-outs in flyers that tell the consumer “how easy it is to help the oceans and environment through the grocery choices we make.”

Retailers can also cross-promote these products with other categories that are natural and organic. For example, around the seafood product display add accompaniments that the shopper might serve or prepare with the fish, such as organic vegetables and rice.

When it comes to frozen fish options, Linda Fox of Janes Family Foods says consumers are looking for: •

I tems that are easy to prepare

•

I tems that offer good value which is not only based on price discounting

•

thically sourced E products that are reasonably priced. A 5% premium seems to be the threshold

Block merchandising by brand also allows the shopper to see the manufacturer’s entire offering. In February 2011, Janes Family Foods converted its entire line of fish to MSC-certified. “Our glazed and marinated items have seen some good growth this past year but the battered and breaded products remain the largest segment at 31.7 per cent of total frozen fish,” says Linda Fox, director of marketing for Janes Family Foods.

May | June 2013

sustain

ability

WASTE NOT

At TerraCycle, a growing upcycle and recycling company, there is no such thing as garbage. This belief fuels the company’s work in finding ways to reuse or recycle the non-recyclables. For example, it has developed ways to turn chocolate-bar wrappers into backpacks or pencil cases, and cigarette butts into plastic “ For every piece of pellets for waste collected, we industrial give back two cents products. The U.S.-based that the collector company was can put towards a born in 2001 when founder registered charity Tom Szaky or school of their discovered that choice.” he could use worms to eat organic waste, while harvesting the worms’ excrement to use as fertilizer. Since then, the company has flourished globally, running a variety of waste programs in 22 countries, with an innovative research and development team at the helm creating solutions for the various waste streams it adds to its roster. And how it collects those waste streams couldn’t be simpler. Through partnerships with CPG companies that have hard-to-recycle packaging, and honing in on other consumer products – such as laptops and cameras – that

are difficult to toss in the trash, TerraCycle offers waste collection programs called Brigades on its website. Anyone who wants to participate can sign up for an account, chose the desired Brigades, and start collecting. Once a box is filled with a certain waste stream, a free pre-paid UPS shipping label can be downloaded from the site to ship the box to TerraCycle. “For every piece of waste collected, we give back two cents that the collector can put towards a registered charity or school of their choice,” says Nina Purewal, general manager of TerraCycle Canada. Since its Canadian launch in 2009, TerraCycle Canada has partnered with a variety of CPG companies, such as Nestlé, Garnier, Tassimo and Mr. Christie, to form its Brigade collection programs, 20 of which are offered at TerraCycle.ca. “We recycle post-consumer waste that won’t go in the blue bin,” says Purewal. “From what we collect, we reuse one per cent, upcycle four per cent into items like bags, and recycle 95 per cent.” For companies looking to get onboard, Purewal says “there are a lot of opportunities for CPGs to take more ownership of their packaging. If they can’t find a feasible solution for their packaging [post-consumer], they can work with us to find a way to recycle it.” As more companies want to drive eco-friendly agendas, partnering is a simple and effective way to divert packaging away from landfills.

Retailers can also get involved by collecting non-recyclable packaging in-store. Western Canada’s London Drugs partnered with TerraCycle in 2012, collecting chocolate bar wrappers and beauty product waste. “We work with Nestlé for the wrappers and Garnier for beauty waste, so any of those wastes within the category can be taken to any London Drugs location to be recycled,” says Purewal. Customers simply drop their candy bar wrappers and empty beauty product containers – which include everything from shampoo bottles to makeup compacts – into the TerraCycle boxes. Since it joined the program, London Drugs has collected 100,350 units of wrappers and 7,984 units of personal care packaging, and has donated $2,167 to the Canadian Cancer Society.

GET THE REPORT: To download the full report, Making an Impact: Environmental Sustainability Initiatives in Canada’s Food, Beverage and Consumer Products Industry, go to: fcpc.ca/issues/environment

May | June 2013

sustain

ability

AND PROFIT

By Noelle Stapinsky

It’s estimated that Canada wastes about $27 billion of food annually, a staggering number that should have us seriously questioning why we feel it’s acceptable to discard edibles so frivolously. Certainly, consumers are the biggest wasters – representing a whopping 51 per cent – but this issue exists across the entire supply chain, from farmers to manufacturers, all the way to retailers. Although Canadians may not be wasting food on purpose, the root of the problem stems from current processes, attitudes towards food and a massive lack of communication from field to fork. Most food waste ends up in our already brimming landfills, but what many don’t understand is that the decomposition of organic waste creates harmful methane gas and carbon dioxide. While it’s energy intensive to process and transport food, it’s not just about the billions lost, it’s also impacting the environment. “We need to fundamentally rethink how we behave and how we [industry] incentivize others to behave in a more sustainable way,” says Martin Gooch, CEO of Value Chain Management International, which published a research document called Cut Waste, Grow Profits that identifies food waste along the value chain. Food Marketing Institute (FMI) in the U.S., formed a Food Waste Reduction Alliance with the Grocery Manufacturers Association and the National Restaurant Association. “We brought together 30 members from each association in June 2011. We looked at all of the research that was out there. Then we surveyed our memberships on what they were doing with food waste, how much they were creating and where it ends up – landfill, animal feed, composting or waste to energy applications,” says Jeanne von Zastrow, FMI senior director of sustainability.

Once its research is complete, FMI will post a free tool kit of best practices on fmi.org, and there will be a presentation at the organization’s Sustainability Summit in August, 2013. According to von Zastrow, some innovative companies in the U.S. are already harvesting food waste from retail stores and manufacturing facilities, and using anaerobic digestion systems to produce energy. And some are composting their waste and selling it at stores. “ConAgra is very engaged with us on food waste. To make their Slim Jim products uniform, they were cutting off the ends. Now they’re collecting those ends, bagging them and donating to Feeding America,” she says. “Instead of dump and destroy, they were able to change the internal policy.” The Food & Consumer Products of Canada (FCPC) is following FMI’s lead, conducting an independent survey with its membership. “Right now, we’re trying to get a better understanding of where food is being lost in manufacturing operations and how much is being diverted,” says Rachel Kagan, vice-president of environmental sustainability policy for FCPC. “We want to be in a position to be able to develop tools and best practices for our members.

WRAP-ING UP WASTE *For retailers, Martin Gooch, CEO of Value Chain Management International, points to progressive companies in the U.K. that have been blazing the trail on waste diversion through initiatives such as its Waste and Resources Action Programme (WRAP), which is a non-profit organization that helps companies with ways to reduce the resources they use and divert priority materials from landfill. U.K. Retailers’ Best Practices • Promote “Buy One, Get one Free,

Later” offers to discourage customers over-buying to get the discount. • Two-for-one offers allow consumers

to mix and match sale items. Gooch says that “This radically diminishes fluctuations in supply which are at the root of food waste.” • Instead of Best Before dates, use

Display By and Use By dates to more clearly communicate product freshness.

Food service 8% Retail stores 11% 49% Transport & distribution 3% Packaging & processing 18%

FOOD WASTE IN CANADA Home 51%

Field 9% Source: Gooch et al., 2010

grocerybusiness.ca

May | June 2013

sustain

ability GREENING THE $UPPLY CHAIN

PRESSURE FOR

EFFICIENCY By Alan Boughton

We’ve all heard the expression “that’s how we roll.” But when it comes to the tires on your tractor trailers, how you roll – literally – can have an enormous impact on fuel consumption and, consequently, greenhouse gas emissions.

May | June 2013

system. It not only inflates cold tires to the optimal 100 psi, but as the tire heats up while rolling, it expulses the air accordingly. Speed also has an effect on tire wear. An increase in speed from 80 to 120 km per hour results in a 17.7 per cent increase in rolling resistance and a 3.4 per cent decrease in fuel efficiency, depending on operating conditions, says The Trucking Network. Some carriers are taking the path of least resistance to fuel economy by installing low-rolling-resistance tires. That is one of the recommendations of SmartWay, an energy-saving initiative developed by the U.S. Environmental Protection Agency and now being rolled out in this country through Natural Resources Canada. These tires deliver a fuel economy benefit of three per cent or more, approximately half of which is contributed by the trailer tires. Verified low-rolling-resistance tires are available from most manufacturers. Additionally, wide-base single tires are increasingly replacing conventional dual tires. Known as “super singles,” these tires can save as much as nine per cent in fuel costs by reducing rolling resistance. In Europe, super singles are used almost exclusively on both tractors and trailers. It’s one more way to keep your truck fleet rolling smoothly. For more information search SmartWay on nrcan.gc.ca.

Effect of Inflation Pressure on Tire Life Loss of service due to underinflation Loss of service due to overinflation

100 Mileage or Tire Life in %

Tire pressure, size, and configuration can all play a role. Proper inflation pressure is the most critical factor in tire maintenance, says Michael Conlon, strategic accounts manager at Michelin Truck. Underinflated tires increase fuel consumption and tire wear rates, create irregular tread wear, and reduce casing durability. In fact, every 10 pounds per square inch (psi) of underinflation represents at least a one per cent penalty in fuel economy, according to the Cummins MPG Guide (see chart). For example, a 30-truck fleet running 160,000 km per year at 40 litres per 100 km fuel consumption and paying $1 per litre of diesel will pay an extra $9,000 to $12,000 per year because of seven psi underinflation, according to The Trucking Network (December 2012). Trailer tires have an even greater effect on fuel economy than either steer or drive tires, and yet they are the most likely to be underinflated and poorly maintained. By the same token, overinflated tires can also cause abnormal road wear. New technologies are helping to maintain the pressure. For example, Karrys Bros., Limited, which distributes packaged goods and refrigerated and frozen foods to the retail gas and convenience channels throughout Ontario, recently leased a new line of trailers featuring a tire-pressure monitoring

80 60 40 20 0 40 60 80 100 120 % of Recommended Inflation Pressure Source: Cummins Inc.

Alan Boughton is president of Trailcon Leasing Inc. headquartered in Mississauga, Ont., with operations in Cornwall, Calgary and Edmonton. Trailcon.com

Trending

TALKING TRENDS

with Brent Houlden, of Deloitte Consulting During Deloitte’s recent conference, the term “gamification” at retail was mentioned. Can you describe what’s meant by that? Although consumers are not always conscious of it, they are gaming when they use a loyalty card for points, and get additional points by putting the purchase through their credit card. The customer feels that he or she is winning by doubledipping on the reward points. Retailers are learning that gaming can drive engagement and create meaningful experiences for their customers. And in fact, gaming is one of the few activities that consumers are totally focused on. While we multi-task everything else, including watching TV, gamification demands undivided attention and it offers a gold mine of data for organizations. What is the future of apps at retail? Today, most mobile apps involve saving time (checking availability, operating hours, directions to the store). In the future, apps will involve more complex transactions, such as in-store price checking or mobile checkout. However, for apps with price-checking capability to work, Canadian retailers will need to post their prices online, which cannot happen until Canadian e-commerce matures. We’ve heard that grocery retailers in the U.K. are using mobile apps to view the store differently. Can you elaborate? Most retail stores are linear – we walk through the store in a controlled and orderly way. The retailer has arranged for everyone entering a grocery store to start with the produce

BRENT HOULDEN is Deloitte’s practice leader for retail and has authored a number of articles about the ways digitialization, mobile applications and social media are changing the retail landscape.

department and then enter the meat department and so on. With technology, we don’t need to see the store as a series of fixed departments or aisles. Instead, a mobile app could feature products that are gluten free or low fat, or that are relevant for a special event or holiday, or that would display various ethnic products in the customer’s preferred language. Technology frees you from the physical world, and retailers must start offering customers new ways to shop and to see their products. You travel globally and can observe best practices – can you briefly tell us what impressed you the most? The U.K. continues to rocket ahead of Canada and the U.S. Many of the retailers in Britain promise three-hour delivery of online orders to 90 per cent of Britain. That is impressive, given that the big eCom players in North America are striving to offer same-day delivery to selected urban areas. I am confident, however, that the delivery challenges currently being experienced in North America will be resolved over the next couple of years, given that retailers, mall developers, and private-equity and technology companies are all investing to improve the delivery experience for customers. When you think about it, there hasn’t been real transformation in retail stores since the introduction of POS in the 1970s. Over the next several years, I expect that retailers will rapidly adopt new digital technologies to offer better customer service and faster checkout. The whole retail shopping experience will be re-engineered to leverage these technologies and enliven the customer experience. No one enjoys lining up waiting to check out, and if they have to, retailers need to ensure the experience is a good one. The solutions can be simple – during the past holiday shopping season, a Canadian retailer handed out toffee lollipops to customers waiting in long lineups – a customer-centric approach in real time.

May | June 2013

Kevin Smith Dan Bordun

Karen James

•

kevinsmith@grocerybusiness.ca

danbordun@grocerybusiness.ca

karenjames@grocerybusiness.ca

•

416 569-5005

416-817-5278

416-561-4744

Check out our website at: grocerybusinessmedia.ca

May | June 2013

grocery BUSINESS WAS THERE

CANADIAN FEDERATION OF INDEPENDENT GROCERS GROCERY SHOWCASE WEST APRIL 14-15, 2013, VANCOUVER, B.C.

grocerybusiness.ca

May | June 2013

“FCC is key to our company

growing

” .

Meb Gilani, President, Gilani Group, Calgary, Alta.

When you talk financing with FCC, we’ll listen Ready to expand? We learn how you want to grow, then create a financing package that helps you do it. Work with the leading lender to agriculture, agribusiness and agri-food in Canada. Let’s talk business. www.fccfinancing.ca

Independent Profile

ANOTHER

YUMMY EXPERIENCE By Noelle Stapinsky

grocerybusiness.ca

When Alexei Tsvetkov, CEO of Yummy Market, opened his first location in Toronto’s North York neighbourhood more than a decade ago, his goal was to bring an eastern European shopping experience to serve the cultural diversity of the area. Over the years, the business grew as a loyal customer base from the eastern European community flocked to the small supermarket for its in-house made-from-scratch prepared foods, and the specialty ingredients and products to create their own cultural dishes. So when it came time to expand with a second location, Tsvetkov wanted to start from scratch and build something different with an overall European experience – an environment that would be warm and welcoming for customers, and remind them of the places they or their ancestors came from. “Before we even started negotiating with landlords, we used iPhone apps that use real census numbers to get an understanding of who was living in [different] areas,” says Tsvetkov. After extensive research around the Toronto area, Yummy Market honed in on a former Metro location in Maple, Ont. – a multicultural community that’s home to several European nationalities. May | June 2013

Independent Profile

The entire flow of the store evokes a European market feel. Next to the bakery is a café with a contemporary wood-plank-style vinyl-tile floor to set it apart from the rest of the marketplace.

May | June 2013

Enter API(+), a Florida-based design firm. “Our mission was to broaden the appeal and create a place where all Europeans feel at home,” says Tom Henken, vice-president and director of design for API(+). “That underlined quite a bit of the design cues that we developed, especially around the perimeter of the store.” Tsvetkov wanted the 52,000-sq.ft. space transformed into a signature look that would hide any resemblance to the previous grocery retailer – a challenge that was obviously achieved. Upon entering, customers are instantly drawn to a large bakery situated directly in the middle of the store – where Metro once had its pharmacy. “The concept was to outfit a fully-functioning bakery that would produce a broad variety of artisan breads,” says Henken. “And since the kitchen had to be quite large, it ended up being constructed in the middle of the store floor.” The bakery, as Tsvetkov describes it, is like a mini bread plant. It produces over 35 different kinds of breads, 40 types of smaller buns, croissants, turnovers, etc., and hundreds of different kinds of cookies, macaroons and other treats. “The placement of the bakery is not only visual, but an olfactory experience as well,” says Ryan Martin, design services for API(+). Henken says that, while they did use some of the base materials already existing in the store, such as some multi-coloured red-toned tiles over the deli and meat area, they chose a diverse pallet of earth tones – one of which, appropriately, is called Borscht. The perimeter walls of the store are overlaid with iconic architectural imagery from different European countries. The entire flow of the store evokes a European market feel. Next to the bakery is a café with a contemporary wood-plank-style vinyl-tile

floor to set it apart from the rest of the marketplace. From there, customers can peruse specialty merchandise, a sprawling cheese and deli counter, and extraordinarily large prepared food and seafood sections that flank the fresh area. Dimensional text and communications in multiple languages highlight the types of food offered in the various departments. And above the large marketplace kitchen, a sign reads: “Modern times called for old-world recipes.” “That was kind of a play we added as part of the design – contrasting old-world recipes and products with a modern environment,” says Henken. The fresh department transitions into a bulk section, leading consumers to the grocery aisles – except that at Yummy Market, Tsvetkov calls them avenues rather than aisles. And you don’t walk – you stroll and experience products. And what’s presented in the centre store is far from a traditional North American offering. There’s an entire aisle of confectionary items. “It’s part of the European culture,” Tsvetkov explains. “Sweets are really big on the other side of the ocean, and people want to spoil themselves a little bit.” The aisle shelving features all-European casework displaying an array of imported products. “The shelving is very modern, and it’s open underneath so it’s easier to clean,” says Martin. In another design twist, most of the frozen section door cases were removed and replaced with reach-in bunkers to open up the area. “There were too many freezers,” says Tsvetkov. “We converted them to

“ It’s all about a complete European shopping experience.”

bunker-style coolers to make it more like an open street. It’s easier to find the product, and it’s much more comfortable to stroll that aisle.” Juan Romero, president and CEO of API(+), agrees. “It’s a wonderful end to Alexei Tsvetkov, the shopping experience due to that CEO of Yummy Market openness.” The details and accents featured throughout the store are impressive. The Yummy brand adorns the walls in traditional Russian and Ukrainian patterns; the “R” in Dairy is reversed to reflect the Cyrillic alphabet; pendant lighting accentuates different service areas; and large wooden structures hang over the frozen department to emulate the pieces of an iconic Russian puzzle game. Even the staff of 180 speak a variety of languages – including Russian, Ukrainian, Polish, Farsi, Hebrew and Italian – to better serve the diverse community that shops there. “It’s all about a complete European shopping experience,” says Tsvetkov. As for future growth, Tsvetkov has his sights set on creating a full-scale catering service. Customers can already call in orders and pick up meals at the store, and Yummy has also delved into catering some large events. But for right now, Yummy Market is all about becoming a part of the community. Besides, says Tsvetkov, you always have the ability to grow, even if it’s within the same walls, with new products and services.

May | June 2013

Networking Events 1

NEW NEWS

March 5, 2013 Network of Executive Women Breakfast 3

FROM THE

NETWORK OF EXECUTIVE WOMEN

Succession planning and the challenge of retaining female employees as they transition through their life experiences were two of the key points that emerged from the recent soldout NEW breakfast event. Joan Toth, the president and CEO of the

Network of Executive Women, suggested that, "women are over-mentored and under-sponsored," which resonated with the attendees. All the panelists agreed that women need to be willing to take risks in order to advance in their careers.

In April, NEW sponsored its first Canadian mentoring event. With 18 mentors and 50 mentees, the event received high marks from the attendees.

2. Emma Bradley, Carol Close, GlaxoSmithKline 3. Dana Childerhose, Steve Churchill, The Nielsen Company; Paul Craft and Tim Berman, Kraft Foods Canada 4. Susan Gatchell, Nancy Moodie, Kellogg Canada Inc.

Key Themes 1. Personal Branding

3. Strength-Based Leadership

2. Diversity of Experience

4. The Importance of Taking Risks

The importance of personal branding. Know your story and be able to sell it. Make a conscious effort to promote yourself and take ownership of your brand.

Chase experience and the recognition and remuneration will come.

May | June 2013

1. March 5, 2013 Executive Panel: Joan Toth, CEO and president, Network of Executive Women; Miyo Yamashita, partner, enterprise risk, Deloitte; Chris Vickers Tucker, president & general manager, The Clorox Company of Canada Ltd.; Carol Stewart, president & CEO, Kellogg Canada Inc.; Mary van Praag, general manager, Coty Canada

The importance of playing to one’s strengths: Strengths never leave you. Find a way to take those strengths and bring them to a diversity of roles within an organization.

Don’t wait to be 100 per cent ready before you take on the next role.

5. Network, Network, Network

Don’t underestimate the power of networking. That includes proactively connecting with senior leaders within an organization.

Checkout out the redesigned Network of Executive Women website: newonline.org

Grand Prix Awards

WHAT’S

IN STORE

the

for

GRAND PRIX

AWARDS

The Canadian Grand Prix New Product Awards – which was traditionally held at the Canadian Council of Grocery Distributors’ (CCGD) National Conference before the association dissolved – will find its new home at the Retail Council of Canada’s (RCC) STORE 2013 conference, June 4 and 5 in Toronto. The two-day event attracts more than 800 of the industry’s top executives, and now with the awards gala included, food retailers and industry will come together to celebrate the country’s most innovative new products. The Grand Prix program celebrates new products from 26 food, non-food and private label categories, all selected by a 32-member jury. This year, the program was open to manufacturers and distributors of all sizes, for products introduced in 2012. The judges panel – grade each entry based on five criteria: uniqueness and innovation, product characteristics, presentation and packaging, overall consumer value and consumer acceptance. From this year’s entries the RCC notes that sustainable packaging continues to be a key trend for the consumer goods industry. Grand Prix judges saw a real commitment from entrants to sustainable practices and an increase in products that are more natural in composition, volume of packaging and imagery. Consumers are looking for more low-calorie

grocerybusiness.ca

By Noelle Stapinsky

In celebration of 20 years of product innovation and for the first time since 2011, the Retail Council of Canada will reunite the 20th annual Grand Prix awards with a conference format.

options that are both convenient and easy to make, and the entries this year really reflected this consumer need, with a particular focus on sodium reduction. “The growth of the consumer products industry depends on new produce development and innovation,” says Diane Brisebois, president and CEO of RCC. “Now in its 20th year, the Grand Prix program has a rich history of showcasing products that respond to leading consumer trends.” Tony Fisher, president of Target Canada, is the keynote speaker on the first day of the conference. And on the second day, leading up to the Grand Prix awards gala, the RCC has planned a special Grocery and Consumer Goods Leadership Symposium, which is also a STORE first. Vicente Trius, president of Loblaw Companies Ltd. and John LeBoutillier, president of Unilever Canada, will open the afternoon presentations, while Domenic Pilla, president and CEO of Shoppers Drug Mart, will providing the symposium’s closing remarks. During the prestigious Grand Prix awards gala, the RCC will honour John Scott, the outgoing president and CEO of the Canadian Federation of Independent Grocers, for more than 20 years of service to the organization and his unwavering commitment to the growth and well-being of independent grocers across the country. For more information visit STOREconference.ca

May | June 2013

Food

CONGRATULATIONS

GRAND PRIX FINALISTS! AGROPUR - NATREL DIV Natrel Baboo™

A. LASSONDE INC. Oasis® Smoothie

BEE MAID HONEY LIMITED Li’l Honeys™ by Bee Maid

MORE FINALISTS 7000 ISLANDS FOOD CORP. Pulo™ Philippine Cuisine A ACADIEN ATLANTIC Smoked Salmon Pâté

BURNBRAE FARMS LIMITED Burnbrae Farms™ Nestlaid™ Eggs

DARE FOODS LIMITED Real Fruit® Gummies

BENTO EXPRESS Bento® Express BEST BRANDS LTD. St-Hubert® Chicken Broths (900mL) CAMPBELL COMPANY OF CANADA Campbell’s Stock First™ CANADA BREAD BAKERY Dempster’s® Smooth Multigrains baked with 16 whole grains CITADELLE, MAPLE SYRUP PRODUCERS’ COOPERATIVE SmartSak - 100% Pure Maple Syrup CLOVER LEAF SEAFOODS, L.P. Gourmet Flavoured White Tuna in Olive Oil

CAMPBELL COMPANY OF CANADA Pepperidge Farm® Cracker Chips

May | June 2013

Food

FRUIT D’OR INC.

HAPPY PLANET FOODS, INC.

Organic Juice Blend with apple juice concentrate -

Happy Planet® Organic Juice

Cranberry - Blueberry

HAPPY PLANET FOODS, INC. Happy Planet® Fresh Soup

GARDEN PROTEIN INTERNATIONAL gardein

MORE FINALISTS EARTH’S OWN FOOD COMPANY INC. Almond Fresh® Coconut FERRERO CANADA LTD. Kinder® Surprise® for Girls HAIN CELESTIAL CANADA Casbah® Side Dish Grain Garden of Eatin®

May | June 2013

HIGH LINER FOODS INC. Flame Savours™

Food JANES FAMILY FOODS LTD. Boneless Bites

KRAFT CANADA INC. NABOB Bold

KRAFT CANADA INC.

Cracker Barrel Cheese Slices

P’tit Québec Natural Cheese Slices

MONDELEZ CANADA

Wheat Thins Baked with Real Vegetables

MORE FINALISTS

MONDELEZ CANADA

L.H. GRAY & SON LIMITED Golden D Eggs

Ritz Crackerfuls

LIBERTÉ Liberté Froúto Greek Yogurt McCORMICK CANADA® Billy Bee* Honey Bottle 375 gr, Pure Natural Honey Club House* La Grille* BBQ Sauce MOTHER PARKERS TEA & COFFEE INC. Higgins & Burke™ Organics Tea

OLD DUTCH FOODS LTD.

Northern Choice Chickpea Tortilla Chips

NOVIDEV SANTE ACTIVE Anti+™ OLYMEL L.P. Olymel® Smart Nature™

May | June 2013

Food

PILLER’S FINE FOODS Piller’s® Simply Free™ Sliced Deli Meats

PARMALAT CANADA

Lactantia Lactose Free Homogenized Milk

PARMALAT CANADA

Astro® Kik™ Drinkable Yogourt

Balderson® Holiday Gift Box

TROPHY FOODS INC.

MORE FINALISTS

Trophy Soft Fruit

SMUCKER FOODS OF CANADA CORP. Double Fruit® Simple Blends™ Fruit Spread SUNRISE SOYA FOODS Sunrise® Super Squeezies™ Dessert Tubes THREEWORKS INC. ThreeWorks® Apple Ch!ps™ ULTIMA FOODS INC. iögo™ Nano – Drinkable Yogurt iögo™ Greko

ULTIMA FOODS iögo™ Probio - Heart of Fruit

VITALA FOODS Vita-D™ Sunshine Eggs WAFU INC. Natural Wafu® Japanese Dressing WESTON BAKERIES LIMITED Country Harvest™ 100% Whole Grain Bread Flat Open Bakery™ - Barbari Flat Open Bakery™ - Naan 60

May | June 2013

WESTON BAKERIES LIMITED Country Harvest™ Fruit Bread

Non-Food MORE FINALISTS BABY GOURMET FOODS INC Squoosh™ DLM FOODS CANADA CORP. Milk-Bone* Healthy Favourites*

BIC INC.

Bic® Soleil® Savy™

GLAXOSMITHKLINE CONSUMER HEALTHCARE INC. Abreva® Pump TUMS® freshers™ antacid

BIC INC.

Bic FlameDisk

CARLTON CARDS LIMITED Lost Socks

HAIN CELESTIAL CANADA

Avalon Organics® Essential Lift™

THE canadian producE markETing associaTion

WE arE THE voicE of producE in canada. CPMA is the national voice of produce in Canada, representing and advancing the industry’s interests, from farm gate to plate.

Visit us online for more information and to apply for membership. cpma.ca

FINALIST

More than

100 Greeting Card Inventions ... and counting

Carlton Cards has delivered more new-to-the-world greeting card inventions to surprise and delight shoppers than any other greeting card company. To bring the best innovation to your card departments,

ÂŠAGC, LLC.

contact Carlton Cards at 1-800-663-2273.

Non-Food NESTLÉ PURINA PETCARE

Purina® Busy Chewnola™ Chew Treat

PROCTER & GAMBLE INC. Dawn® Power Lift™

PROCTER & GAMBLE INC. Tide® Pods™

PROCTER & GAMBLE INC.

COVERGIRL + Olay Tone Rehab™ 2-in-1 Foundation

UNILEVER CANADA

Clear™ Scalp and Hair Therapy

MORE FINALISTS PROCTER & GAMBLE INC. Always Radiant Infinity Pads™ Downy® Unstopables™ Febreze® Car™ Gillette® Fusion® ProGlide Styler™ Gillette® Venus and Olay™ System Shaver Head & Shoulders® Old Spice Red Zone® Invisible Solid Pantene® Pro-V® Aqua Light™ Tampax Radiant Tampons SC JOHNSON AND SON, LIMITED Glade® Expressions™ Fragrance Mist Glade® Expressions™ Oil Diffusers OFF! Clip-on™ Ziploc® Brand Perfect Portions SOLO CUP CANADA Solo® Holiday Collection

grocerybusiness.ca

CARLTON CARDS HAS BECOME CANADA’S #1 GREETING CARD COMPANY BY OFFERING EXCITING, FRESH AND NEW-TOTHE WORLD PRODUCT HELPING CONSUMERS CONNECT IN VERY MEMORABLE WAYS.

Understanding Canadians want cards that surprise and delight, Carlton Cards has responded with innovative and interactive product featuring music, motion and amazing technology. The charming Ready, Set, BlowTM collection prompted the recipient to blow on an image, triggering an audio and LED-light surprise. A 2012 Grand Prix New Product Awards finalist, The Lost SocksTM collection, is a simple but sweet sock puppet. Watch this fall for another Carlton Cards innovation, Sparkle KnitsTM, adorable, musical minifleece sweater cards perfectly decked out for Christmas.

May | June 2013

Private Label

CANADA SAFEWAY LIMITED

Lucerne Greek Fat Free Yogourt, 500 g

CANADA SAFEWAY LIMITED Open Nature Bacon, 375 g

CANADA SAFEWAY LIMITED The Snack Artist Cookies

CANADA SAFEWAY LIMITED

Open Nature Honey Nut Bar, 40 g

LOBLAW BRANDS LIMITED PC Partly Skimmed Milk

LOBLAW BRANDS LIMITED President’s Choice Refrigerated Condiments

MORE FINALISTS CANADA SAFEWAY LIMITED Debi Lilly Illusion Vase X-Large Debi Lilly Savoy Candle Edwards Coffee, 326 g Lucerne Greek Fat Free Yogourt, 500 g Open Nature Bread, 680 g Open Nature Ice Cream Bars, 4 x 100 ml Safeway Tuna, 170 g Waterfront Bistro Cocktail Sauce, 227 g Waterfront Bistro Crab Cakes LOBLAW BRANDS LIMITED PC “Free From” Angus Beef Burgers PC Ice Cream Black Label President Choice “Nutrition First” Senior Pet Food President’s Choice Cheesecake Lollipops 64

May | June 2013

LOBLAW BRANDS LIMITED

President’s Choice “Recipe to Riches” Butter Chicken Lasagna

LOBLAW BRANDS LIMITED

President’s Choice Fouée - Pocket Flatbreads

LONGO’S

Longo’s Signature Ricotta

Private Label METRO RICHELIEU INC.

TM/MC

Irresistibles Les Hors-d’oeuvre

METRO RICHELIEU INC.

Irresistibles Chicken Wings

O S D’ EUV

TM/MC

FRUITS DE MER

• RES

S E AFOOD

• HOR

LOBSTER BITES BOUCHÉES AU HOMARD

- D’ Œ U

Lightly breaded with a tangy cream cheese and lobster filling seasoned with chives and red peppers Légèrement panés avec une garniture au fromage à la crème piquant et au homard, assaisonnés avec de la ciboulette et des poivrons rouges

{ 270Frgu i t y ’n’ C re a m y }

KEEP FROZEN • GARDER CONGELÉ

SUGGESTED SERVING • PRÉSENTATION SUGGÉRÉE ENLARGED TO SHOW TEXTURE • AGRANDI POUR MONTRER LA TEXTURE

ICE CREAM & SORBET BLEND

ICE CREAM &

DARK CHOCOLATE & RASPBERRY-CRANBERRY

CHICKEN WINGS, SEASONED, GLAZED, FULLY COOKED AND CUT UP

D RA C FRA

18% MEAT PROTEIN

AILES DE POULET ASSAISONNÉES, GLACÉES, ENTIÈREMENT CUITES ET COUPÉES 18 % DE PROTÉINES DE VIANDE

GENERAL TAO GÉNÉRAL TAO A zesty blend of ginger, garlic and red peppers with a tamari soya sauce glaze

MA MA MADE AD D DEE WIT WIIT W TH

Un mélange piquant de gingembre, ail et poivrons rouges avec un glaçage à la sauce soya tamari

3 5 1

KEEP EEPP FFROZEN ZE • GARDER ZE GA ER CCONGELÉ GA ONGE ONGE G LÉ LÉ

Mild • Doux

SUGGESTED SERVING • PRÉSENTATION SUGGÉRÉE ENLARGED TO SHOW TEXTURE • AGRANDI POUR MONTRER LA TEXTURE

550 g

70% 7 0% COCOA COCOA CH C CHO CHOCOLATE HO CO LATE

500 m 500 mLL

KEEP FROZEN SUGGESTED SUG SU UGG U UG GG G GES EEST STTEED SE ST SERVING RVIN RV VIN V IN NG NG

METRO RICHELIEU INC.

Irresistibles Fruity ‘n’ Creamy Ice Cream & Sorbet Blend

METRO RICHELIEU INC. Sélection Ice Cream 1.66L

SOBEYS INC.

Compliments Thin Crust Pizza

SOBEYS INC.

Sensations by Compliments Petite Mousse Parfait Collection

MORE FINALISTS

SOBEYS INC.

Sensations by Compliments Extra Virgin Olive Oil 3L

grocerybusiness.ca

METRO RICHELIEU INC. Fresh 2 Go Toscana Focaccia Irresistibles Bio Organic Bread RTB Irresistibles Dark Chocolate Covered Caramels with Sea Salt Irresistibles Dry Sausage Irresistibles Life Smart Mediterranean Style Quiche Irresistibles Marinated Angus Beef Flank Steak Irresistibles Mini Crisps Life Smart Margarine Irresistibles May | June 2013

WE’RE HONOURED

to be chosen as a Grand Prix Finalist!

We’re pleased to announce that our Burnbrae Farms™ Nestlaid™ eggs are a new product ﬁnalist in the Canadian Grand Prix Awards. These eggs come from hens raised in small social groups that are free to perch and lay their eggs in a nesting area in an enriched colony house environment, and are fed a diet of whole grains and other wholesome ingredients. And like all of our products, it represents our ongoing commitment to innovation and nutrition to meet the evolving

lifestyles and dietary requirements # of all Canadians. We are also proud to have been selected as a past winner of 13 Grand Prix Awards! From all of us at Burnbrae Farms, we sincerely thank the Canadian Food Industry Judges for their appreciation.

For more information, contact us at: 1 800 666-5979 or burnbraefarms.com

Private Label

THRIFTY FOODS Cheesy Crab Dip

WALMART CANADA

Our Finest - Lattice Top Pies

WALMART CANADA

Our Finest - Salad Dressing

WALMART CANADA

Our Finest - Stuffing Topped Mini Turkey Pies Appetizer

MORE FINALISTS WALMART CANADA

Our Finest - Single Serve Entrée

grocerybusiness.ca

WALMART CANADA Great Value - Peanut Butter Milk Chocolate Bar Our Finest - Cheese Cake Our Finest - Extra Thick Cut Chips Our Finest - Single Serve Entrée Our Finest - Stuffing Topped Mini Turkey Pies Appetizer Your Fresh Market Cookies May | June 2013

PAC Awards

CONGRATULATIONS TO THE GOLD LEADERSHIP AWARD WINNERS! FOR PACKAGING EXCELLENCE AND LEADERSHIP Billy Bee, McCormick Canada

Lego Hero Factory Stand-up, Lego

The Little Grape That Could…

Cracker Barrel and P’tit Québec, Kraft Foods

MilkBite, Kraft Foods

Lundberg Rice, Lundberg Family Farms

SUNSET, Mastronardi Produce

Dan Akroyd Discovery, Diamond Estates Winery

Minute Maid 100% Juices, Coca-Cola Ltd.

Maxx Scoop, Nestlé Purina PetCare Canada

Minute Maid 450 ml Full Shrink Bottles, Coca-Cola Ltd.

Stoney Ridge Pinot Noir, Stoney Ridge Cellars Ltd.

Compliments – Bakery Category, Sobeys Inc. Green Ocean, Green Island Seafood Products Ltd. Walker’s Chocolates, Walker’s Chocolates Alaskan, Premier Tech Home & Garden Ltd. Cliplight, Cliplight Manufacturing NV Clinical, Wellnx Life Sciences

Philadelphia Indulgence, Kraft Foods Robax, Pfizer Consumer Healthcare Selection, Metro Inc. Nestlé Noir L’Assortiment, Nestlé Canada Inc. Windows 8, Microsoft Corporation Sensations by Compliments, Sobeys Inc.

Pillsbury Buttermilk Biscuits, General Mills

CoorsLight/Canadian/Iced Tea, Molson Coors Brewing Company

Real Fruit, Dare Foods

iögo, Aliments Ultima Foods Aero Deluxe Dump Bin, Nestlé Canada Inc. Kit Kat Dump Bin, Nestlé Canada Inc. Nexxus Hydra-Light Floorstand, Unilever Canada Dairy Milk 21 x 100g, Mondelez Canada

May | June 2013

PAC Awards

BRAVO!

TO THE PAC BEST OF SHOW AWARD WINNERS LEADER AMONG LEADERS AWARD: KRAFT FOODS GROUP

$$$

COMING IN NOVEMBER G rocery Business Leading Edge Award: Crystal Light Mocktails, Kraft Foods Group Inc.

P ackaging Association of Canada, Packaging Award: Minute Maid, Coca-Cola Ltd.

C anadian Packaging Consumerâ&#x20AC;&#x2122;s Voice Award: Coors Light/Canadian/ Iced Tea

P ackaging Association of Canada Sustainable Packaging Award: Odwalla PlantBottle, Coca-Cola Ltd.

W almart Canada Sustainable Packaging Award: Clorox Bleach, The Clorox Company

Is your equipment polymer-ready?

Contact your supplier.

LIST IT

New products you need to know about!

Savoury Favourites Maple Pepper Unique Canadian Seasonings

Savoury Favourites delivers big health benefits. Made with 100% pure maple syrup granules and black pepper, Savoury Favourites packs a big health punch!

Spice Blend Display Free displays available. Large display Includes: »» 1 case per Maple Pepper® Spice Blend (Original, Chipotle, Mild Curry & Garlic) »» 5 cases of Maple Pepper® Spice Blend Gift Boxes »» 1 case of Maple Pepper® Gourmet Grilling Plank Kits savouryfavourites.com

Transform Your Water Into Wellness Delicious and nutritious, Karma’s vitamins and nutrients are stored in the cap until you release them into the liquid, ensuring maximum potency and freshness. drinkkarma.com 70

May | June 2013

AT SAW IT SIAL

Stickin’ With My Bone Suckin’ Sauce With summer around the corner, consumers are looking for unique BBQ sauce options. Bone Suckin’ Sauce is gluten free, has no preservatives and is non-GMO. bonesuckin.com

Homemade Style Condiments Come With Jar Appeal

SAW IT AT SIAL

Safie's condiments are appealingly packaged in traditional mason-style jars with condiment ingredients that are hand-picked and flavoured with a blend of natural spices. safiespecialtyfoods.com

Bringin’ Home the Bacon As the latest addition to the meat snacks category, Oberto’s new Bacon Jerky, with no added preservatives or artificial flavours, goes beyond being a stand-alone snack because consumers can also enjoy it in a BLT sandwich or even chopped up on nachos, baked potatoes and salads. oberto.com/bacon

grocerybusiness.ca

May | June 2013

it figures >

Online:

31%

The Other Convenience Channel 31% of Canadian consumers compare grocery prices online

Takeaway Value-driven consumers are turning to the Internet to look for ways to save. What they find online ultimately impacts their purchasing decisions – whether it’s what to buy or where to shop. Your online efforts should be viewed as a key promotional vehicle to motivate consumers to choose your store or product.

ONLINE SHOPPING FOR CPG PRODUCTS HAS GROWN

32%

11% IN THE LAST YEAR

Takeaway These households make up 17% of total households, but spend 43% more than average. Manufacturers and retailers can appeal to this segment by making sure their mix of products and services appeals to and meets the needs of high-end shoppers.

of Canadians shopped online last year for CPG products Takeaway More Canadian households are making CPG purchases online. E-commerce for CPG continues to gain consumer reach, with over 4.3 million households shopping online – a 14% increase in the past year alone. This presents a fantastic opportunity for retailers and manufacturers to build shopper loyalty through online promotional campaigns.

May | June 2013

36%

of consumers participate in social media to receive coupons and promotions

% 18% 18%

Takeaway Word of mouth has never been more important to consumer purchasing decision. Consider offering space on your website and social media pages for consumer advocates to have a voice.

of Canadians say they use social media to express concerns or complaints about brands Takeaway No news may be good news, but donâ&#x20AC;&#x2122;t make the mistake of ignoring the negative comments. Consumer complaints and concerns need to be addressed promptly to win back consumers and prevent negative sentiment about your product or store from spreading. The best approach is to meet negative commentary head-on.

18% of online shoppers are 65+ Takeaway Donâ&#x20AC;&#x2122;t assume older consumers are not connected or online. For example, Nielsen data shows that boomers are tech-savvy consumers. Whether aging consumers are offline or online, they need ease of use, larger fonts and specialized topics such as health and wellness information.

Carman Allison is responsible for creating and delivering thought leadership to manufacturer and retailer clients and at CPG industry events. A frequently sought-after speaker, Allison has more than 20 years of experience in the consumer research industry with Nielsen, where he has held various account management and analysis roles.

A L L S TAT S C O U RT E S Y: N I E L S E N

grocerybusiness.ca

Carman Allison

May | June 2013

Perry’s Point of View

THE OLD CRYSTAL BALL On the back of my stunning prediction that the Argos would win the Grey Cup, I decided to make other forecasts on a variety of topics. But after quickly discovering that my ability as a seer did, apparently, not extend to the racetrack, I have decided to turn my crystal ball toward upcoming trends and events in the Canadian grocery business. The Canadian retail food industry has experienced seven consecutive years of strong earnings performance despite somewhat muted overall sales growth. The source of the earnings growth has been a relatively calm competitive market due to limited net square footage growth; a strong Canadian dollar (particularly in the last three years) which lowered the cost of a large number of products procured in U.S. dollars; and the use of clout and market share leverage by the largest grocers to negotiate ever-larger rebate packages from suppliers. But more recently, as certain markets have become more competitive, we have seen a slowing of operating profit growth, a reduction in capital spending and earnings growth generated largely by share buybacks. Looking ahead to the next couple of years, we would identify the key market trends as follows:

• A cautious Canadian consumer will make

promotional programs all the more important. Over the past three years, a material amount of the Canadian dollar windfall on transfer prices was passed through as

May | June 2013

increased deals. This caused merchants to increase promotional weights and breadths without having to overly invest using their own margins. But consumers have become increasingly addicted to deals and are more skeptical than ever about regular prices.

• We are also seeing a rapid and sudden rise

in food industry square footage – above and beyond the “sustainable” 1.5 per cent rate. This will continue through 2013 and 2014. This sudden burst, caused by former Zellers stores being converted partially to food square footage by Target and Walmart, will hurt store-level sales productivity almost nationally. This rising square footage is made worse by very little dead square footage dropping out the bottom. Invariably, instead of going dark, old stores are now sold or leased to ethnic grocers who run low-priced, high-volume operations.

• The primary growth channels for suppliers

will be Target, Walmart, dollar stores, drugstores, Costco and ethnic grocers. The ethnic grocer channel will see super-independents rise up, particularly among the Asian grocers. Buying groups will be formed and they will offer significant growth in exchange for better buying costs.

A cautious Canadian consumer will make promotional programs all the more important.

• Lower sales productivity is usually addressed

by competitive price responses and accompanying lower margins. We are already seeing this in early earnings results, and this problem will continue. Grocers experiencing margin erosion will increasingly look upstream to their suppliers for relief. Look for that pressure to build over the next 12-18 months. If the Canadian dollar slides below previous years’ levels, then the pressure on suppliers to make up the difference will be increased.

• Eroding margins will cause traditional

grocers to consider consolidation. Although Canada is already a heavily consolidated market, there are possibilities for more. Primary targets for acquisition will be Safeway Canada, Overwaitea and the ethnic grocers, as well as drugstore operators suffering under the current headwind of provincial drug reimbursement reform.

And the Oilers will win the Stanley Cup. In 2014.

Perry Caicco is the managing director for CIBC World Markets. He has worked for 15 years in the supermarket, general merchandise and packaged goods industries with Loblaw Companies, Coca-Cola and Consumers Distributing.

“ We know our advertising in GROCERY BUSINESS MAGAZINE is effective” States, Sharon Baingan, National Sales Director, Organika Inc. “ Our ad looked great and we were thrilled to have received calls from retail buyers who had seen our advertisement for our recently launched, Organic Coconut Palm Sugar and Coconut Vinegar products, in Grocery Business”.

Organika has evolved over 20 years to a world class manufacturer and distributor of superior health products selling to retail food stores around the globe. For more information regarding Organika, go to www.organika.com or call 604-277-3302. For more information on Grocery Business, go to www.grocerybusiness.ca or call 416-817-5278.

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