Target... and other things to watch in 2013

12/19/2012

Will bacon continue to be big next year? Are conventional grocers going to be overtaken by discounters?

Canadian Grocer editors gazed into their crystal ball and compiled a list of the top trends to watch in 2013.

1) Target, yes. But who else?

Target isn’t the only retailer to watch next year; Farm Boy is another. The well-regarded 13-store fresh chain opened for the first time outside its home base of Ottawa-Cornwall this year, adding a store in Kingston, Ont. Farm Boy also got an infusion of cash from Boston-based investment firm Berkshire LLC. Why? To help bankroll its expansion across Ontario and, perhaps, Canada as well.

Also keep an eye on Marche Adonis. Purchased last year by Metro Inc., this Mediterranean grocer is set to hop the Quebec-Ontario border, opening a store in the Toronto area. Both Farm Boy and Marche Adonis are savvy operators, meaning no matter where they go, they’ll be formidable competitors.

2) Ahh, the recovery
Back in the fall of 2008, when the Great Recession began to reach the masses, doom-and-gloom economists predicted that a full recovery might not kick in until 2014. Right now, the recovery is tepid at best. At worst, it’s bouncing dangerously close to a double-dip.

Grocery’s recovery has been equally without cheer. In 2012, sales at grocery stores and other food and beverage retailers pin balled between a one per cent decline and barely two per cent growth. Will we do better in 2013? Higher food prices, which are anticipated, may help, as might weaning ourselves off heavy price promotions. Then again, with Canadians up to their eyeballs in debt, and Walmart, Target and every other major chain continuing to add grocery square footage by the football field in 2013, real growth may have to wait a bit longer.

3)The farmer is the law

Let’s face it: Farmers are the new rock stars. Not only do locavores adore them, so do a growing number of regular Joes and Jills who equate (often incorrectly) local food with health, nutrition and saving the planet. Expect the love affair to continue in 2013 as food retailers ramp up efforts to link their businesses to the farmer down the road. (Our suggestion: forget merely putting pictures of your farmer suppliers up in stores, and consider hosting a farmer’s market in your parking lot.)

Meanwhile, watch for more government action on the local front. For instance, outgoing Ontario Premier Dalton McGuinty in September announced plans to create a Local Food Act to promote Ontario grown and made foods. McGuinty also promised targets on local food consumption and wanted to meet with supermarket chains to encourage them to carry more Ontario-grown fare. Dalton, we at Canadian Grocer await the first crop of Sudbury strawberries this February.

4) Here comes the e-supermarket. No, wait…
Around the world, the online supermarket is in full bloom. In the U.K., nearly every major grocery chain lets customers order online. In Korea, consumers are buying groceries with their phones on virtual supermarket walls at bus stops. And in France, shoppers are doing something called “Drive”–ordering groceries on their phone, then heading to special drive-thrus major grocery chains have built for pickup.

Here in Canada, none of the major chains offer online ordering. At Canadian Grocer’s Thought Leadership Conference in November, retail executives said they were closely watching online activities in other countries, but none said whether they were going to launch such initiatives in Canada. OK, maybe we’ll have to wait until 2014 for this trend to take off.

5) Dollar stores as food stores



In 2013, will dollar stores in Canada finally get serious about selling food?

It’s already happened in the U.S., where dollar chains such as Dollar General have made a big push toward offering fresh food and not just canned goods. Dollar stores in the U.S. see food as key to long-term growth. Dollar General, for its part, is rapidly opening 40 Dollar General Market stores over the next year that feature a selection of grocery, frozen, and dairy and even fresh produce and meat.

Expect to see more grocery hires at the dollar store chains here as they get serious about food: Family Dollar, which hired a former Delhaize America exec to be its senoir VP of food, while Rick Dreiling, the CEO of Dollar General, is a former grocer. With U.S.-based Dollar Tree now expanding into Canada, it will be an interesting race to the finish for food.

6) Food waste: the sustainability issue of 2013

Food waste grabbed headlines this fall when a study revealed $27 billion worth of food produced for Canadians ends up in garbage cans.

The impact on the environment is equally shocking: as reported in Canadian Grocer’s October issue, degrading food generates methane, a gas 25 times more damaging to the environment than CO2.

With increased consumer awareness, experts predict the next big phase of the sustainability movement will be the war on food waste.

7) Supermarket stars



Canadian Grocer predicts the new stars of the supermarket will be the experts: dietitians and
chefs. The supermarket chef in particular has lasting appeal with his/her white coat offering grocery stores an upmarket appeal instead of just a typical HMR section.

In-store chefs will not only offer a way to market different departments, but can develop recipes using certain products, including those on sale. And today, supermarket chefs compliment many grocers’ in-store restaurants and catering businesses. Celebrity chefs have launched their own grocery food lines, and some like Toronto’s star chef Mark McEwan have even ventured into retailing as well. Look for these chefs to start offering personalized concierge services, as some say it’s the next natural progression.

8. Ethnic flavours infiltrating North American classics/comfort food

In 2013, ethnic ingredients will no longer be reserved for ethnic dishes.

According to McCormick & Company, which releases a Flavour Forecast each each, “Global My Way” is set to become a major trend. The authors say ethnic flavours will crop up in everyday, North American comfort foods. Butter chicken macaroni and cheese, anyone?

9) Popcorn to jump off shelves
It’s a light, tasty, calorie-wise snack that can turn into a sweet, salty, savoury or spicy treat when mixed with flavouring.

The culinary team at Sterling-Rice Group, another group that identifies upcoming food trends, predicts popcorn will be found in everything from salads to ice cream in 2013.

10) Veggies to take centre plate
Step aside, meat. In 2013, vegetables will be promoted from sidekick to dinner-plate superhero.

The experts at Sterling-Rice Group say garden-grown foods will become “entrées (cauliflower steaks), starches (squash noodles), and even delicious beverages (celery juice cocktails).” Why? According to one Top Chef winner quoted by SRG, consumers are catching on to the sad state of our oceans and the mistreatment of animals. Plus, they have greater access to farmers’ markets and well-stocked produce sections.

11) Up in smoke




Instead of fried or broiled, smoking is going to be big in food preparation this coming year. And home smokers are gaining traction among foodies. Why?

Indoor wood-burning smokers offer up flavour by using different types of wood without added fats, sugars or excess salt. Look for the smoking trend to go beyond bacon to include smoked cocktails, olive oil and even smoked water.

12) Retailers buy up food brands



With grocery margin's razor thin, retailers are looking for ways to expand their business. Take the latest reports that Walmart and Kroger have both put in bids to buy Hostess Brands, the bankrupt Twinkie maker.

If either retailer gets the exclusive on Twinkies, it could draw traffic and differentiate itself from competitors. Reports also say that if Walmart nabbs Hostess, it could outsource production much like how it does with its private label.

So look for retailers to move beyond their own private label brands and get into buying up food brands up for sale, taking collaboration to a whole new level.

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