A standalone retailer, Pasquier, which opened in Quebec in 2010, is touted as the country’s largest independent grocer at 150,000 square feet. The grocer is well known for its bakery and meat departments, but also offers an expansive produce section with many locally grown fruits and vegetables, a plethora of fresh-cut selections, and an entire second floor devoted to cooking lessons and dining.
Originally modeled after the U.S.-based Wegmans Food Markets chain, Pasquier has become a “destination” for Quebecois shoppers—so much so that Big Three rival Loblaw looked to the independent retailer for inspiration when remodeling its own Quebec stores.
Urban vs. Rural Locations
Stores in major town centers are thriving, but some rural areas have become extremely price-sensitive. “Urban independents and regional players are doing better than small and rural operators,” Bourlier says. She notes that Walmart has been aggressively expanding into rural areas and small towns, as urban areas have less space available for supercenter formats and already face fierce competition.
Independents and smaller chains operating in urban areas, meanwhile, are able to fill niches not well served by the big chains. Downtown stores, for example, often feature better or unique selections of natural and organic foods, a health and wellness focus, or assortments of hard-to-find produce for ethnic consumers and sophisticated cooks.
An example is Toronto’s Galleria Super-market, with two locations in the city and plans for as many as 20 stores by 2030. Galleria specializes in Korean foods with an extensive array of fruit, vegetables, herbs, and flavorings. The stores are also known for their selection of freshly-prepared traditional Korean meal kits; customers call a day ahead and meal components are assembled for pick up the next day.
Some of the independent chains opening new stores in 2015 and 2016 include Vince’s Market, which specializes in fresh food-heavy small formats and is adding a new location in Tottenham to its existing stores in Sharon, Newmarket, and Uxbridge, Ontario; Farm Boy 2012, which opened four fresh markets in Ontario in 2015, bringing its total to 19; Marché Adonis, which opened branches in Laval and Anjou, Quebec; and the McEwan Group, owned by celebrity chef Mark McEwan, which opened a second store in downtown Toronto featuring chef-created prepared foods and groceries.
A prime differentiating factor of these urban and suburban chains is their selection of fresh fruits and vegetables, often featuring abundant ethnic varieties tailored to local communities. Adonis’ produce department features commodities used in Middle Eastern cooking, including six varieties of dates and several types of figs, Egyptian mangos, almonds and pistachios, Lebanese cucumbers, molokhia (mallow), and green fava beans. Overwaitea’s new PriceSmart store in Burnaby focuses on produce from across Asia, as well as packaged goods from Asian suppliers with its grab-and-go dishes including sushi, dim sum, and Asian barbecued meats.
Fresh Alternatives: Nonfood Retailers
Another emerging trend in Canada mirrors the United States: the entry of nonfood stores into the grocery business. Drugstore chains have been adding fresh food and produce to their shelves. Shoppers Drug Mart, acquired by Sobeys in 2013, has moved some traditional products aside to make way for fruit, vegetables, and value-added products.
Smaller grocery chains have been part of this trend as well—Pusateri’s Fine Foods, a specialty grocery in the Toronto area, is supplying food halls in both new Saks Fifth Avenue locations in the city, filling 21,000 square feet in the Eaton Centre store and 18,500 at the Sherway Gardens location. And Farm Boy opened a ‘Farm Boy Fresh Zone’ at the Canadian Tire Centre, home of Ottawa’s Senators hockey team.
The Big Three: Wins & Losses
The larger grocery and general merchandise chains continue to expand, fighting the incremental encroachment of regional, local, and independent players. All of the Big Three continue to open new stores, close underperforming locations, acquire smaller chains to monitor trends and bring specialization in-house, and explore online grocery sales.
