The Western Canadian Food Scene is Full of Prairie Pride

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Sports dynasties, oil fields and wide-open spaces where beef cattle roam and wheat yellows under a cerulean sky — Western Canada has all of these, but it also has a diverse and robust restaurant scene that’s negotiating tricky times. Restaurants in Manitoba, Saskatchewan and Alberta share the same kinds of challenges — such as labour shortages and real-estate prices — that are besetting the rest of the country, but they also have a few worries of their own.

Statistics Canada’s figures on Food Services and Drinking Places Sales for the period from January to November 2018 show revenue growth from $169.9 million to $173.9 million in Manitoba; from $156.9 million to $159 million in Saskatchewan and from $769.3 million to $789.3 million in Alberta.

MANITOBA
“Overall, Manitoba seems to have a little bit of a challenge: not a lot of strong growth,” says Robert Carter, industry advisor, Foodservice Canada for Toronto-based NPD Group.

Among the difficulties, “with consistent growth in minimum wage, it’s getting tougher and tougher for operators to run an efficient and effective restaurant with the proper staffing levels,” says Shaun Jeffrey, executive director of the Manitoba Restaurant & Foodservices Association. Generally, “the Manitoba economy is stable and has been for many years; the restaurant industry continues to grow in a small market with extended competition.”

However, as of last November, drivers in Manitoba are liable to severe penalties if they are found with a blood-alcohol level between .05 and .08. This has already had an impact on sales of beverage alcohol.

“Manitoba is probably steady as she goes; not too many huge issues or obstacles,” says Mark von Schellwitz, vice-president, Western Canada for Restaurants Canada. “However, the same cannot be said about the other two provinces.”

SASKATCHEWAN
Saskatchewan is seeing unit growth led by the expansion of chains such as Browns Restaurant Group (BRG), Cactus Club, White Spot and Boston Pizza. This is good news for a provincial industry hit with a new six-per-cent provincial sales tax on restaurant meals in April 2017. Restaurants Canada estimates the new tax has had a cumulative impact of $90 million in lost revenues since then.

The labour supply varies with the fortunes of the resources sector: “when oil and gas happens big time, we lose people in the restaurant sector,” says Jim Bence, president & CEO of the Saskatchewan Hotel and Hospitality Association (SHHA). “The emerging challenge is the cannabis industry; when the producers get up to speed, they’ll need anything from 750 to 1,000 people — we can’t compete with that.”

ALBERTA
“Alberta seems to be on a bit of a recovery,” Carter says, noting the province has the second-highest restaurant use and the highest penetration of quick-service-restaurant (QSR) use in Canada. Although it’s favoured by the absence of a provincial sales tax on restaurant meals, a combination of a weak economy and new government initiatives have caused significant distress.

Recent changes include an increase in Alberta’s minimum wage to $15 per hour last October: an increase of almost 50 per cent for most workers and 63 per cent for liquor servers, who previously received lower pay to balance their potential to earn gratuities. In addition, changes to Alberta’s Employment Standards Code mean many part-time workers now receive holiday pay on statutory holidays. There have also been changes to the regulations around tips and gratuities to be reported as insurable earnings.

Restaurants Canada estimates the province’s foodservice sector has lost 10,200 jobs in the last few years. The average number of employees per establishment dropped from 13 to 11.7 between 2015 and 2018 and, although overall sales figures show growth, von Schellwitz says the numbers may be misleading, since many restaurants have raised prices to offset costs.

“We have a workforce of about 250 employees; a healthy number of them got a raise when minimum wage went up and a proportion of those now qualify for statutory holidays; it’s caused us to look differently at our hours,” says Devin Morrison, director of Operations with Teatro Group in Calgary. Like some other establishments, Teatro’s restaurants are rethinking closure on statutory holidays; since staff must be paid in any case, opening, even for low revenue, may be preferable to staying shut.

“[Sales in] all of Alberta have been really down; the only part that has been okay has been the Banff area, because of the resort business,” von Schellwitz says. In fact, Banff is booming.

“The restaurant scene in Banff has really been elevated in the last five years — that goes hand-in-hand with the vibrant economy. More money has been spent on the interiors of restaurants in the last five years than in the 20 years before that,” says Mike Mendelman, CEO of the Banff Hospitality Collective, which operates 12 food-and-beverage outlets in Banff.

“We’ve had everything go right since about 2010; the biggest trigger point for us is a low Canadian dollar,” he says. On the menu, “regionality is playing a more significant role all the time. The number-1 food product Alberta is known for is beef; 65 per cent of our food sales is Alberta beef.” However, “the desire for plant-based cuisine is here and it’s only going to grow.”

Tomas Sohlberg, owner of the all-vegan Boon Burger Café in Winnipeg, agrees, noting “the new Canada’s Food Guide almost completely removed dairy off the menu and included so many more meat alternatives. Earl’s has revamped its menu to add a lot of vegan options. A&W has added its Beyond Meat burger, which is selling out.”

Similar national trends, driven by millennial diners, are playing out on the Prairies, such as the demand for casual-but-upscale dining, transparency in sourcing and especially healthy eating. For instance, “we write menus that are 90-per-cent gluten-free now,” says Justin Leboe, senior culinary director for the Concorde Group in Calgary.

They differ, but the Prairie provinces share a vitality and abundance that poises them for growth now — as it has in the past — when the trials of the moment are over.

Written by Sarah B. Hood

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