Looking Back: The Trends that Shaped 2018

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Looking back at 2018, the Canadian foodservice industry experienced many challenges, such as minimum-wage debates and increased commodity prices, as well as opportunities such as the arrival of international operators Chick-fil-A and Jollibee. It was also a year of innovation, which will continue to drive our industry forward. Here are the top-5 trends that stood out.

DIGITAL DISRUPTION
Digital is fundamentally changing the way we dine out. Growth in digital ordering has been in the double-digit range for many years and the rate of growth is accelerating as more operators launch and expand their use of apps and the availability of delivery.

Digital is shifting the way we order food, pay and order delivery. It’s also shifting our perceptions of convenience and loyalty. While it’s the younger generations who are driving this growth, every generation is taking part and creating a digital revolution.

About 39 per cent of Canadian households have ordered a restaurant meal for delivery through a mobile app/website and digital orders now account for more than $2 billion in sales — with no sign of letting up.

McDonald’s is poised to become the largest digital-order operator on the strength of its partnership with Uber Eats and SkiptheDishes, knocking the pizza operators out of top spot.

But, operators need to find balance on better food packaging. For example, using packaging that keeps fried foods crisp and hot longer, but are also compostable/ environmentally sustainable.

PLANT POWER
A&W made a bold move in its ongoing quest to stand apart from the competition with new and innovative products and a consistent quality message by featuring a premium vegetable-based burger. The Beyond Meat Burger was so successful the chain ran out of supply for about a month. A&W’s brand revitalization over the past four years has allowed its food-quality satisfaction to exceed that of the average FSR.

At Planta, plant-based dishes such as the “Carrot dog” — a spin on the traditional Ball Park Frank in toppings but featuring a roasted carrot — are taking centre stage. On the supplier side, Nestlé and Maple Leaf both acquired plant-based companies/offerings to add to their portfolios.

KID-FRIENDLY MEALS
Family traffic has been on the decline for many years, making competition fierce for this valuable, high-check party. While Tim Hortons is already the top operator for family occasions, McDonald’s remains the leader in kid’s meals, leveraging kiosks and staff to do table-side service. In order to steal share, Tim Hortons introduced its own kid’s menu — striving to make its restaurants a destination for kids while making it even easier for parents who already love the brand to bring the kids along.

EVOLVE OR PERISH
With on-premise dining declining and being challenged by delivery, concepts are evolving to give people another reason to visit the restaurants. For example, food halls are expanding, turning a simple meal into an experience and the Cineplex Rec Room brings gaming to dining. Conversely, ghost and virtual restaurants are gaining traction, allowing restaurants to manage labour and real-estate costs by operating only in the virtual world.

On the technology front, kisoks, robotics and apps such as Spiffy — used to assist with the time-intensive training process — are helping operators’ bottom lines.

SEGMENT SHIFT
The FSR segment has been shrinking and losing guest visits as consumers of all generations choose convenience and value. Much of this decline is traced to the Boomer generation, which is cutting back on visits to all restaurant segments, while the younger millennial and Gen-X generations are not growing fast enough to replace these visits.

Independents, in particular, have struggled to keep up with the proliferation of chains, but those that remain are showing signs of strength, driven by millennials who prefer local and authentic offerings. New delivery services are making it easier for independents to reach a whole new audience.

The premium segment continues to grow, as consumers cut back on their frequency of restaurant visits, but want to ensure maximum value when they dine out by choosing the best operators they can afford.

Written by Robert Carter

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