Canadian foodservice operators look to retail

The slowing economy has resulted in Canadian restaurant operators looking to establish a strong retail presence, according to a Euromonitor International report.

Especially in Quebec, restaurants have been building a strong retail presence for a number of years either through having an adjacent grocery store selling specialty products to developing products for retail and sold under the foodservice operator's brand name.

For example, the Quebec-based chain of vegetarian restaurants Le Commensal has been supplying local grocery stores with its line of chilled soups, quiches and other products.

The products under Le Commensal brand continue to see double digit growth in Quebec grocery stores, according to the article.

Foodservice operators have been marketing other product categories, including sauces and dips, which can be more cost effective to package and supply to grocery stores.

For instance, Arahova Souvlaki chain of Greek restaurants markets its dips and spreads in grocery stores, while Quebec famous Les Rôtisseries St-Hubert has sold frozen processed chicken products and sauces in Quebec grocery stores for a number of years, the article notes.

With consumers' increasingly looking for convenient meal options, and the strength of brand recognition in the aisles, foodservice operators are expected to build on sales opportunities in both foodservice and retail.

As well, in a downturn, consumers will eat in but look for restaurant quality offers in retail to make at home.

MTY Food Group meanwhile is offering ethnic cuisine for the retail market in Canada.

The group operates foodservice brands like  Sushi Shop, Thai Express, Tiki-Ming, Valentine, Culture's, Country Style.

The company's subsidiary,  Tiki Ming Enterprises, signed a licence agreement with Produits Alimentaires Berthelet Inc, which will develop and market MTY's branded products in retail stores across Canada.

The first products will ship to grocery stores in early 2013 and will include sauces and frozen processed foods, but isn't looking to supply fresh ready meals as production and distribution is costly.