Mike Dean Local Grocer shows how filling a niche can be a strong strategy for independents
Photo by Jessica Deeks
A keen sense of finding the gaps and knowing what customers are going to want has made Mike Dean Local Grocer a small but mighty force among Canada’s independent grocers. Not only is this rural-based, family-run business still going strong after 45 years, the grocer is opening a fourth location in the midst of a pandemic.
The latest Mike Dean Local Grocer location is set to open in Campbell’s Bay, Que., in June. And while it has a smaller footprint than the other locations in the Eastern Ontario towns of Chesterville, Bourget and Sharbot Lake (3,700 sq. ft. versus 12,000 sq. ft.), it aims to replicate their winning formula: cater to the cottage and camping crowds, while also becoming a hub of the community. “We’ll be limiting our assortment given the space, but we’re still sticking to the course when it comes to the products that move,” says owner Gordon Dean. “The fact we’re in a prime location as people are coming to their cottages and provincial camping grounds means we’ll be right under their noses.”
The grocer switched its focus from bigger suburban markets to cottage country in 2015, and over the years has become adept at anticipating what visitors to rural Ontario and Quebec will want most. “For example, we ramped up for the season by bringing in 288 can openers ... and 300 cases of marshmallows,” says Dean. “And with simple stuff like chocolate bars, we probably sell three times the number that traditional grocers would.”
Even during the winter, when the number of visitors drops, Dean says he’s mastered how to move inventory around his stores to meet local community needs. “There is opportunity in cottage country because there aren’t many people who have an interest in running these small-footprint stores,” he says. “You really have to know what you’re doing with the seasonality [of items] to make it work.”
By working directly with brand manufacturers and eliminating “the middle man,” the grocer can also offer many unique local product lines. And with its own warehouse and two trucks, Mike Dean Local Grocer stocks substantial inventory that can be easily transported to its various locations as needed.
Heading to Canada’s Far North
Never one to ignore opportunity, the grocer seized another chance to expand in 2019 by partnering with Arctic Fresh, an online grocer, to supply groceries to remote communities in Nunavut. “Never in my wildest dreams would I have thought we’d be sending boxloads of groceries to different airports to be delivered thousands of kilometres away, but when opportunity knocks and the economics make sense, you take it,” says Dean.
Arctic Fresh takes food orders from grocery stores in Nunavut, while Mike Dean Local Grocer handles the operations. That means using its warehouse in Chesterville to prepare and package grocery supplies 52 weeks of the year, all while handling the logistical complications that are inevitable when transporting items such far distances. “It’s a matter of understanding the business, plus we already had warehouse space and were buying in volume from suppliers, so the synergies worked well for us,” explains Dean.
While the Arctic Fresh partnership is proving successful so far, Dean says the path to his company’s expansion “wasn’t always a straight line and things didn’t always work the way we wanted them to.” For 10 years, he says, the focus was on volume, topline sales and getting into larger markets, which proved unsustainable. After selling some properties to a larger competitor, the grocer got out of the suburbs entirely to focus on cottage country areas with population densities that were too small to attract big competitors. “I’d take going into a small town any day [rather] than trying to compete with Walmart,” says Dean.
All in the family
That’s not to say becoming profitable in a small market is effortless, he adds. To succeed in a rural setting, Dean says his stores have to serve as the everyday convenience shop, fresh food market and big box store, too. “If we do our jobs right, we have pieces of all those pies as the other players don’t exist here,” he says.
Earning the loyalty of locals also requires becoming truly entrenched in their communities. “Obviously I spend on sponsorships and donations, but more importantly they want to see my face at events and that I have a vested interest in their communities,” says Dean. That could mean attending dinners at the local Lion’s Club or loaning a five-ton truck to the fire department. “It’s about showing interest in helping out in ways that aren’t just economic, too.”
Dean also credits the company’s long-standing success to the tight-knit family running the show. His father started the business in 1976, but Dean and his sister worked right alongside him from an early age. “I was working 40 hours a week by the age of 15,” says Dean. “My father taught me to work hard and never be afraid to fight with suppliers to get the best you can from them.”
Today, both siblings and their spouses are involved in the company’s daily operations. “Everybody has their own hat to wear and I think that’s important, as it gives everyone a sense of purpose and something they can call the shots on,” says Dean, noting that all four of his children work part-time in the business as well.
Best of all, at the age of 41, Dean is still as passionate about the grocery business as he was when he first started—and he expects to keep on expanding if the economics make sense.
Despite the fact the big chains are getting bigger, he says Mike Dean Local Grocer proves that independents can keep thriving. “Forget about being a big-picture grocer and stick to what niches you’re good at,” he advises. “Then, keep adding pieces to make you different from a corporate grocer and make sure you’re awfully darn good at what you do.”