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On demand

Delivering the goods in the midst of a changing foodservice industry 

Screen Shot 2020-11-23 at 3.37.12 PMNine months into the COVID-19 crisis, Canadian restaurants are in a fight for survival, investing in initiatives to re-ignite growth and recover daily traffic levels in the midst of challenging conditions that include rising infection waves, mandated reductions in seating capacity, limited hours of operations and consumer safety concerns.

One thing is certain—the market will not go back to how it was before the pandemic. The current circumstances have forever altered the business landscape for the out-of-home dining industry, including c-store store foodservice.

In the pre-COVID-19 era, more than one in four occasions (27%) were consumed away from home, either at work, restaurants, schools and other off-premise locales.  During the early April and May confinement period, away from home foodservice occasions plummeted by more than 60%, with almost nine in 10 of those occasions (88%) now being consumed at home.  

Fast forward to the latest Ipsos Foodservice Monitor (FSM) syndicated data release for July and August 2020 shows a considerable rebound in dining out activity. Although increases in home cooking habits remain higher than in the pre-COVID-19 era, consumers are acting upon their pent-up-demand for ‘tasty restaurant options’, with foodservice occasions rebounding almost 40% from their springtime low.

But now, with more uncertainty on the horizon and closures in various regions, where can foodservice invest to boost performance on the path going forward?

Ipsos Foodservice Monitor (FSM) reveals one key area representing opportunity: the rise of online delivery and contactless ordering/payment options.   

Consumption and lifestyle priorities

Investing in homebound experiences is the new ‘going out’, particularly as more of us are working from home.  Interestingly, those who are working outside the home are almost twice as likely to leverage the foodservice channel versus those who are working from home.

While working from home may negatively impact in-person foodservice foot traffic, especially in office-heavy urban areas, it can also create new opportunities. During March to July 2020, FSM reported that overall delivery traffic doubled in size, with total dollars increasing three-fold.

According to Asad Amin, VP and leader of Ipsos’ Food and Beverage Group: “While online delivery services are still relatively small, increased usage is likely here to stay even after the health crisis, due to its sheer convenience.  Today, close to one in 10 Canadians are ordering from this channel.  The COVID-19 impact has merely accelerated the trend to off-premise dining which had been factoring into consumer decisions for some time.”

Digital ordering and delivery habits

The rise of delivery services has not only doubled from its pre-COVID base, but almost a quarter of Canadians (23%) report that they will be ordering more online in the future. 

The positive outlook for delivery is also aided by the size of the dollar prize. Currently, the average per-eater amount for delivery service orders ($13.47) is a whopping 40% higher when compared to take out orders. The increases at dinner are even more notable, highlighting the financial significance of the opportunity.

Beyond the revenue growth opportunity, investment in delivery options is also a defensive play. FSM tracking reveals that as many as four in 10 consumers (40%) report that they will likely go out to dine less often after the COVID-19 related closures and restrictions end.

Given that these higher delivery volumes are likely to endure, operators may need to reassess which delivery model to adopt and how to invest. 

Foodservice providers have a wide range of options and barriers to consider, including which model to adopt—operator-driven or third-party enabled—with consideration given to the economics of speed and cost, just to name a few.  Additionally, to be addressed, are mounting concerns about the morality of delivery services due to environmental factors, such as superfluous packaging, as well as fair treatment of workers and more.

Made for delivery menu options

To satisfy growing demands for online delivery or pickup, operators will need to offer products that travel well and ensure taste and safety quality.  Today, just 65% of consumers report that delivery services are taking all necessary precautions to ensure food safety and quality.  Could there be opportunity to grow sector confidence?

As consumer behaviours continue to evolve and as we adapt to the next new post-COVID reality, the foodservice industry together with many other sectors, will undoubtedly face new and unforeseen challenges. But the players that will emerge stronger are the ones who keep their finger on the pulse of shifting habits and who are willing to make bold and decisive moves to build resiliency to ensure long-term success.

Screen Shot 2020-01-16 at 3.49.27 PMKathy Perrotta is a VP with Ipsos Market Strategy and Understanding, working with the Food & Beverage Group Syndicated Services. Data sources within this group include Ipsos FIVE and Foodservice Monitor (FSM), a daily tracking of purchases, habits and motivations at all foodservice segments and at branded operators among more than 36,000 individuals annually. 

 


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Toronto COVID 19 lockdown will have ‘major impact’ on residents and businesses, says councillor

Convenience stores will be allowed to operate at 50% capacity

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Toronto and Peel Region will enter the province’s Lockdown level effective Monday, Nov. 23, Premier Doug Ford announced on Friday afternoon.

It means restaurants, bars, and other food and drink establishments will only be able to provide takeout. Indoor dining and patio dining has been prohibited.

Personal care services such as barbershops and salons will be closed. Casinos, bingo halls, and other gaming establishments will be closed. Indoor sports and recreational facilities will be closed.

Essential retail such as grocery stores, supermarkets, pharmacies, hardware stores, discount and big box retailers selling groceries, liquor stores, safety supply stores, and convenience stores will be allowed to operate at 50%t capacity.

Non-essential retail will be closed and will have to operate through curbside pickup or online delivery. Wedding services, funeral services, and religious services can have up to 10 people indoors or 10 people outdoors. Outdoor organized public events or social gatherings will be limited to 10 people.

Residents are asked to stay at home and go out for essential needs only. No indoor organized events or social gatherings are permitted. Individuals who live alone, including seniors, can have exclusive contact with another person.

Schools and child care centres will remain open.

The Lockdown order follows a continuing steady rise of cases in Ontario, with 80 per cent of new cases in Red Zone regions in and around the Greater Toronto Area.

Hospitalizations have increased by 22 per cent, and ICU admittance grew by 50 per cent, Ford said. The Premier added that if the restrictive actions were not taken, the province would see up to 6,000 daily cases in the coming weeks.

“This virus, it spreads like wildfire,” Ford said. “And in certain parts of the province it’s spreading at an alarming rate.”

He explained that if the lockdown measures aren’t taken then it risks overwhelming the province’s hospitals and ICUs, reminding Ontarians that the “situation is extremely serious.”

The new health measures will be in place until Dec. 21.

The province also announced $600 million in business relief (up from its initial announcement of $300 million). Eligible businesses can apply online for a temporary property tax and energy cost rebate grants.

The rebates will cover the length of time the business is required to close. Most businesses can expect to receive rebate payments within a few weeks of submitting an online application at Ontario.ca/covidsupport

Ford’s announcement follows Prime Minister Justin Trudeau’s earlier announcement Friday, Nov. 20, morning.

“This is for the future of our country, our children, our loved ones, our seniors, its economy, our businesses,” he said, asking Canadians to stay at home as cases spike across the country.

“Another few weeks, another few months, we can do this, we’ve done it before, we know what to do, we understand this virus much better than before, we need to reduce our contacts, we need to do it right now,” the Prime Minister added.

As of Nov. 20, Ontario reached more than 100,000 cases, and 3,451 deaths since the beginning of the pandemic this year. There are 518 patients hospitalized, 142 in ICU, and 92 on a ventilator, with the numbers continuing to grow.

Both Toronto and Peel have seen roughly 300 to 500 new cases each day for the last three weeks.

Toronto had a total 35,040 cases as of Nov. 20 since the beginning of the pandemic, currently it has 4,398 active cases. Almost 1,500 Torontonians have died this year as a result of COVID-19.

Across the city, COVID-19 has spread in varying degrees. While the northwest and Scarborough remain hardest hit, it has spread quickly through some parts of East Toronto and neighbourhoods surrounding the Danforth, including outbreaks in local long-term care homes.

As per Toronto Public Health data, in the last 21 days the Beach had six cases, East End-Danforth had 21 cases, Taylor-Massey had 47, Danforth and Danforth-East York had 13 and 18 respectively, and Greenwood-Coxwell recorded 24 cases.

The caseload per 100,000 is dire in Taylor-Massey (Crescent Town) where there are 300 cases per 100,000 in the last three weeks.

Beaches-East York NDP MPP Rima Berns-McGown said the emergency public health measures announced on Friday aren’t enough to stop the spread.

“Until Ford makes the connection that he needs to support vulnerable workers and communities, we will not be able to get this virus under control,” she said.

“It will cost the economy more in the long run than it would to invest in the workers, communities and small businesses that need immediate help.”

Berns-McGown added the province “wouldn’t have been in this situation” if Ford had taken public health advice that included more testing and contact tracing. The Premier has responded to criticism by saying he listens to all the medical advice he receives from Ontario Chief Medical Officer of Health Dr. David Williams, who was present and also spoke at Friday’s press conference.

As per the NDP’s repeated requests this year, Berns-McGown said the reduction of school class sizes, allowing workers to have paid sick days to stay home when they’re ill, and an emergency moratorium on evictions is what would actually make a difference in bending the curve of COVID-19 cases.

“One of the reasons we are in this nightmare is that many of our frontline workers are low-income earners who can’t afford to stay home when they are sick. So they don’t know if they will be evicted if they fall behind in their rent,” she said.

Beaches-East York Councillor Brad Bradford, who had been monitoring the effect the pandemic has had on local businesses, said the lockdown is very worrying.

“As I talk to community members across Beaches-East York, I know another lockdown is going to have major impacts on our physical, economic and mental health,” he said. “Our local businesses have been hard hit. We hear a lot about the hospitality sector but our other local staples like gyms, yoga studios and other recreational activities are really hurting. I share a lot of the sentiments I’m hearing about the approach and communications on managing this crisis being confusing and seeming inconsistent.”

“While it’s sometimes hard to understand one specific decision over another, it’s clear that we need to take the public health advice seriously,” Bradford added.

Earlier moves by the city that had allowed restaurants and bars to offer outdoor patio service and space over the winter, will be ineffective during the lockdown.

Local politicians, business owners, and the Premier are all imploring residents to shop local and order takeout to help weather the economic fallout of the lockdown.

The Premier also told Ontarians to “avoid panic buying” as supply lines remain open and continuous.

While Toronto and Peel moved into Lockdown stage, Durham and Waterloo were moved to Red, and other health units across Ontario moved to Orange or Yellow.

At the press conference, Dr. Williams asked Ontarians in high-risk zones to avoid travel to lower-risk zones during the lockdown.


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RioCan CEO says real estate industry’s norms have turned upside down

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Demand for space in prime office towers and shopping malls has plunged because the pandemic suddenly turned them into places that customers and tenants “don’t even want to go to,” RioCan Real Estate Investment Trust’s veteran chief executive said last week.

“Unfortunately … everything that was accepted wisdom in the real estate business only eight months ago has been turned on its head, even in the face of record low interest rates and massive government spending,” Edward Sonshine told analysts on a conference call.

Another formerly “bulletproof” segment of the industry – multi-unit residential rental properties – is also being questioned due to government freezes on rents and evictions, Sonshine said.

An exception to the gloom, Sonshine said, has been strong demand for new condo developments and single-family residences.

Sonshine said RioCan fared better during the third quarter than he expected it would and credited the work of RioCan management, led by Jonathan Gitlin, who becomes chief executive April 1. Sonshine, who announced on Oct. 21 that he’ll retire as CEO in March after nearly three decades, will become chairman of the board.

Gitlin told analysts on RioCan’s third-quarter conference call that rent collected from tenants, plus government subsidies, represented 93.4% of billed rent for July, August and September and 91.9 per cent for October.

That compared with just 73% in the months of April, May and June, as reported in July with RioCan’s second-quarter results.

“While we’d clearly prefer to report 100 per cent collection, as we’ve been able to do during the first 26 years of our operation, we’re pleased with the steady upward collection trajectory since April,” Gitlin said.

RioCan had estimated early in the pandemic that its overall property occupancy rate could fall to as low as 94%t by the end of 2020, but it had improved to 96% as of Sept. 30 and it’s expected to be stable through to the end of the year.

“Happily, we’re leasing space up almost as fast as the tenants disappear,” Sonshine said.

But he said forecasts about coming trends are difficult to make without knowing how long new COVID shutdowns will be in effect. especially in the Greater Toronto Area and the Ottawa region – the biggest markets for RioCan.

“You know, there’s only so long that tenants can go without revenue before they start wanting to talk to their landlord,” Sonshine said.

RioCan said that as of the end of the quarter on Sept. 30, essentially all of its tenants were open and operating – compared with only 85% as of July 28.

The real estate trust said it had $117.6 million of net income or 37 cents per unit for the three months ended Sept. 30, down from $177.6 million or 58 cents in the 2019 third quarter.

It said $14.4 million of the $60-million decline was due to pandemic-related provisions related to rent abatement and bad debts, while $48 million was due to higher net fair value losses.

Funds from operations, a key metric in real estate, declined to $128.8 million or 41 cents per unit from $142.8 million or 47 cents per unit.

All the key financial measures were an improvement from RioCan’s second quarter ended June 30, when it posted a net loss of $350.8 million or $1.10 per unit and FFO dropped to 35 cents per unit.

In July, RioCan said it would divest from brick-and-mortar apparel retailers in favour of grocery stores, pharmacies and e-commerce.

But Sonshine said Thursday that RioCan has decided to hold onto its traditional retail properties, which include shopping malls and plazas, and look for better opportunities.

“It’s a really slow market, in any event, because (I think) there’s so much uncertainty about the future of retail,” he said.

Revenue fell to $302.3 million from $353.9 million a year earlier.


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Are you eligible for the Canada United Small Business Relief Fund?

Screen Shot 2020-10-27 at 12.12.19 PMThe Canada United Small Business Relief Fund (CUSBRF) is designed to help small businesses offset the cost of expenses to reopen safely or adopt digital technologies to move more of their business online in the wake of the COVID-19 pandemic.

More than $14 million (contributed by the Federal Government, RBC, and Canada United partners) is available to support recovery efforts of small businesses. The federal government recently committed $12 million to the project.

In turn, the organization is extending relief grants to more small businesses and is now accepting grant applications from small businesses across the country for expenses incurred no earlier than March 15, 2020.

To date, the organization has received applications from more 1,000 small businesses to reimburse them for COVID-19 related expenses, such as purchases of PPE, physical space renovations and developing website and e-commerce capabilities.

The CUSBRF will be managed by the Ontario Chamber of Commerce on behalf of the national Chamber network in support of other chambers and partners. Successful applicants will receive a relief grant of up to $5,000.

Click here to learn more about the program and to see if you qualify. 


Eyvind Dahl owns Dahl's Coin Laundry & Convenience in Renfrew, Ont.

The ups and downs of tobacco 

After a surge in sales during the COVID-19 lockdown, how do c-stores keep smokers coming back for more?

Eyvind Dahl owns Dahl's Coin Laundry & Convenience in Renfrew, Ont.

Eyvind Dahl owns Dahl’s Coin Laundry & Convenience in Renfrew, Ont.

As Canada locked down in the wake of the COVID-19 pandemic, Eyvind Dahl noticed something at his Renfrew, Ont. c-store went up: tobacco sales. 

Dahl, the owner of Dahl’s Coin Laundry & Convenience, attributes the increase in tobacco purchases to the closure of First Nations’ borders in the province, a protective measure to fight the coronavirus. “When they closed the reserves, our tobacco sales more than doubled,” says Dahl. 

He notes that sales of Imperial tobacco alone jumped from 50 to 100 cartons a week. Hand in hand with that increase in business came a surge in impulse purchases. “All my categories shot up,” says Dahl. “We were so busy it was crazy.”

 Surge then slide

Screen Shot 2020-10-27 at 10.40.46 AMDahl was not alone in seeing a surge in tobacco. According to a survey conducted by the Ontario Convenience Stores Association (OCSA), retailers throughout Ontario showed an increase in tobacco sales that ranged from 10% to more than 30%. The survey of the association’s 6,000 members also found that proximity to a reserve played little role in the booming business. Sales increased across the board, and almost half of the stores surveyed were more than 30 kilometres from the closest reserve. Dahl’s Coin Laundry & Convenience is an hour away from the nearest First Nations community. 

The boom has been temporary, however. “Now that the reserves are back open, sales are going down, down, down,” says Dahl. “It’s going back to normal, which shouldn’t be normal.”

The issue of contraband tobacco has been a significant one for retailers, particularly in Ontario. “The illegal cigarette market has been left unchecked for far too long,” says OCSA CEO Dave Bryans, who is based in Oakville. “This can’t go on. In Ontario, 30 to 60% of butts swept are contraband.”

The OCSA is calling on the provincial government to develop an integrated plan to address contraband concerns and other tobacco issues. “The survey demonstrates a need to work with the Ontario government to develop a tobacco strategy from pricing, formats, promotions and incentives to protect small businesses as well as government’s health policies,” says Bryans.

The Convenience Industry Council of Canada noted a similar surge amongst its members. During a recent interview with CSNC, president and CEO Anne Kothawala said CICC is engaging “Ernst & Young to put together a comprehensive study on contraband tobacco across the country. We need much stronger public policy to address this issue.”

 Competing with contraband

Until then c-stores are looking for ways to enhance tobacco sales. In the current environment, productivity is paramount, says Anthony Ruffolo, vice president, McCowan Design & Manufacturing Limited in Toronto. “Plain packaging has definitely made it more difficult to vend the product quickly. You need to be more efficient and organized.”

Products like McCowan’s secure undercounter tobacco cabinets can help. This may also free up the back wall for new opportunities, space often previously dedicated for tobacco products. “There is an ability to generate profits off the back wall. You may even be able to sell advertising,” says Ruffolo. 

Sara Clarkson, president of Storesupport Canada in Mississauga, points out that helping people work through the plain packaging maze will build customer loyalty. “There is still lots of confusion regarding cigarette brands with the start of plain packaging. Knowing what brands to recommend is key and ensuring stock is available of those brands for your regular customers is also of huge importance.”

Bryans recommends c-stores promote the least expensive products they have in inventory as a way of competing with First Nations’ retailers at a basic level. 

While that will attract some new customers and keep others coming back, there is no way c-stores can compete head on with contraband sales, notes Dahl. A carton of cigarettes from the reserve is $20. His cheapest brand is $120. “It’s a huge difference. I can sympathize with the customer.”

The focus on tobacco sales includes another harsh reality for c-stores: the category is declining.

Bryans notes that c-stores sell 99% of all legal cigarettes and sales are declining 1.5 to 2% a year. “That is a huge concern for the channel. The time has come for a task force to review the tobacco business in Canada.”

Filling the void

One solution is to look for options that can replace tobacco. Vaping seemed a promising category and the profit margin is greater than tobacco. The product is also very popular, but there are concerns about safety and increasing regulations that are undoubtedly affecting retailers.

Many would like to see c-stores be able to sell alcohol, and the industry has been lobbying the government and raising public awareness for the last seven years to encourage a move to an open retailing market. Doug Ford’s Progressive Conservative government has promised that market will soon be a reality in Ontario, but the wait continues.

Ruffolo also recommends retailers look for products and services that set them apart, such as foodservice or local products. “You need to draw in new customers. The more you know your customers, the more you will be able to retain them.”

It’s also critical to remind customers—through signage, conversation, and any other means—that c-stores offer what competitors, from larger stores to smoke shacks and vape shops, do not. That message resonates more clearly and convincingly in a COVID-19 world, notes Clarkson. “With access to grocery stores being more difficult with line-ups and extra time needed to shop, quick convenience is more important than ever. Ensuring staples are in stock and healthy snacks will promote a quick stop at the convenience store.” 

 

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Outgoing NACS chair Julie Jackowski reflects on ‘unpredictable’ year

Julie Jackowski NACSWhen asked to briefly summarize her experience as the 2019-2020 NACS chair, Julie Jackowski didn’t have to pause to think.

“Totally unpredictable,” she told Convenience Store News (CSNC’s U.S. sister publication) with a laugh. “That’s probably the biggest word.”

While the position traditionally comes with a busy schedule full of outreach, advocacy and organizational duties, Jackowski faced a new level of challenge this spring when the coronavirus pandemic prompted widespread business closures and stay-at-home orders. Not only did the convenience store industry have to balance the safety of its employees and customers with the need to serve communities, but NACS itself also had to find new ways to support its thousands of retailer and supplier members.

“A lot of it is in-person events,” Jackowski said, recalling the sudden need to reinvent how she could fulfill her responsibilities as chair of the association while working from home.

She admits that it was disappointing at first, as she looked forward to seeing people and networking, but she soon found the value that Zoom calls and virtual meetings can bring. The lack of associated travel time opened up space on her calendar, and digital events gave her the opportunity to connect with members of the industry who might not have attended the face-to-face events.

“I realized there’s a different way to serve,” she said. “I probably met with more people virtually than I would have in person.”

A CHANGE OF PLANS

2020 doesn’t mark the first unexpected change in Jackowski’s career. As a lawyer who focused on employment law due to her desire to help people, she had no connection to the c-store industry before a partner at her firm alerted her to an opportunity at Casey’s General Stores Inc. Today, she serves as chief legal officer and secretary of the Ankeny, Iowa-based chain.

“I didn’t grow up in the industry,” Jackowski said at the closing general session of the 2019 NACS Show in Atlanta. “I didn’t seek out the industry, and somehow it found me.”

The first few months of her time as chair proceeded normally, with the NACS Show serving as the kickoff for Jackowski and other NACS leaders to coordinate larger projects for the year to come. When COVID-19 hit, the focus shifted to how they could best serve the needs of NACS members and ensure that the industry’s smaller retailers and entrepreneurs had the resources they would need to survive and thrive.

“We did a lot of government outreach,” she said, describing “countless” meetings with senators and congressional representatives. Jackowski cites the designation of convenience stores as essential businesses, along with other COVID-related legislation such as the CARES Act, as particularly important achievements during her term.

While the c-store industry might not be the first retail segment to come to mind for many people when they’re asked to name essential businesses, Jackowski views it as a case of layered support. Hospitals and health care clinics need to stay open to support their communities as they fight COVID-19, and c-stores and other businesses support the health care workers who keep those facilities open by helping fulfill their needs.

While some consumers are already aware that c-stores can be more than a place to make an impulse buy — particularly those who live in areas where the closest grocery store isn’t just around the corner — she believes the pandemic has opened the eyes of many more consumers.

“What is this industry all about?” she asked. “It’s not just about selling candy bars and cans of pop.”

ALL ABOUT ADAPTABILITY

Jackowski credits the “fabulous” NACS government relations team, as well as the other teams and committees she works with, for getting so much done during this unprecedented crisis. She participates in multiple NACS committees in addition to her work as chair.

The move to virtual meetings required the NACS Political Action Committee to take a new approach to fundraising. At the same time, the coronavirus crisis provided a clear example of how NACS can represent and advocate for the c-store industry.

“All the work we’ve done regarding COVID, it did shine a light on that particular service we bring through membership,” Jackowski said.

While she points to the advocacy and government relations work as the accomplishment she is most proud of during her year as NACS chair, that pride is related just as much to how things were done as it is to the end result.

“Accomplishments are really just being adaptable,” she said. “Adaptability is really the key to everything.”

A willingness to adapt and be flexible will continue to be useful in an industry that is seeing significant change on multiple levels, Jackowski noted. Over the next five years, she expects the competitive space to shift through further consolidation as large chains acquire smaller ones. She also believes that advances in technology and the digital space will keep moving forward, pushing c-store operators to keep up.

On the foodservice side, she believes that many c-stores will continue to develop a more quick-service restaurant type feel through the expansion of fresh food offerings.

When asked what advice she has for future NACS chairs, Jackowski emphasized a similar willingness to adjust and meet NACS members’ needs in new ways.

“Just as our businesses have worked to adapt to a changing retail environment, those in leadership roles must also adapt their ways of doing things to meet the needs of those we serve,” Jackowski said. “Knowing that social distancing restrictions will likely remain for some time, it is imperative that we continue to network through virtual conferencing, placing more emphasis on governmental advocacy, and ensuring that we truly listen and respond to the needs of our members through a more individualized approach to communications.”

While restrictions related to the pandemic may be inconvenient, they also open the door to try new things that may turn out to be equally effective, according to the outgoing chair.

“Whether in person or virtually, the chair must focus on representing the industry, bringing industry issues to the forefront, and connecting with members,” she said. “Be creative in your approach to provide ways for our members to connect with you and with one another, whether that is through in-person collaboration, small group virtual meetings on topical issues, or just having a socially distanced happy hour for people to reconnect and laugh.

“The time goes by quickly,” Jackowski continued. “Enjoy having that brief time to lead the best industry family there is with people who, while competitive, are sincere, kind and support one another so that we can collectively best serve our communities.”

 


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For small businesses that survive COVID, recovery is expected to be difficult

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Having 12 cases of mini eggs on hand sounds like the makings of a grandiose Easter hunt or the ultimate way to soothe a sweet tooth, but for Josie Rudderham, the confections have put her in quite the crunch.

“We have joked about pouring them into a bathtub and doing a photo shoot because there is enough to do that, but really they are part of the cycle of investing in ingredients to make a lot of sales that didn’t happen,” said Rudderham, the co-owner of Cake and Loaf in Hamilton, Ont.

She spent the first months of the COVID-19 pandemic closing one of her two bakeries, taking on debt, laying off workers during the busy Easter season and offering curbside pickup, but the boxes remain. Worse still, she believes her business won’t fully recover for another decade.

The projections are quite similar for most of the country’s 1.14 million small businesses still lamenting empty dining rooms, stores and cash registers, and fretting about how they can rebound from the pandemic’s economic impacts.

The Canadian Federation of Independent Business says a survey of its 110,000 members shows only 26% of small businesses are reporting normal sales volumes, leaving the remainder at risk of insolvency.

Those that do survive aren’t likely to emerge from the pandemic unscathed. The CFIB estimated in June, before Canadian COVID-19 infections began rising again, that small businesses will incur $117 billion in debt that could take more than a year to pay off.

“The majority of them have said that they are losing money every day that they are open and I guess the question is how much longer can that happen,” said CFIB president Dan Kelly.

Reversing the trend will take a return of sales at a time when many businesses can’t get COVID-friendly insurance, patio season is coming to an end, offices are showing no signs of reopening and Ontario and Quebec are plunging into second waves.

CFIB wants the government to help small business owners recover by suspending evictions and property seizures for shuttered businesses and providing immediate financial support to cover ongoing costs like rent and taxes.

Sheila Block, a senior economist with the Canadian Centre for Policy Alternatives, also believes public coffers have a role to play in the rebound, but warned government relief isn’t a cure-all.

“The only thing that will ensure that small businesses can come back to life is the public health situation and that is going to take some time,” she said.

While the wait continues for a COVID-19 vaccine, Kendall Barber is keen on getting Poppy Barley, the Edmonton-based footwear company she co-owns with her sister, back on its feet.

When COVID-19 struck, the pair temporarily shut down their two Alberta stores, laid off some workers and put plans for pop-ups across the country on hold.

“All of our factories closed, so we had no ability to get products, and even developing our fall collection was hard because tanneries and facilities were closed and located in countries that are much harder hit by COVID-19 than we have been here in Canada,” said Kendall.

Poppy Barley reverted to its roots in e-commerce. Fans of the brand made purchases online, but not enough to make up for what was lost from closures.

Recovery, said Barber, will now rely on meeting the customer where they are.

For Poppy Barley, that means slowly bringing back pop-ups in 2021 and shifting to meet new consumer needs with fewer high heels, footwear made from ultra soft materials that don’t need breaking in and a plant-based collection.

For many small businesses, which have grappled with layoffs, rent problems and mounting bills, recovery will also mean leaning on customers.

“The simple answer is shop, buy their food, spend your money with them,” said Barber.

“On the darkest days getting a great email from someone saying, ‘Keep going. I love what you’re doing’ has also been really meaningful.”

Changing business models will also be a big piece of recovering, said Rudderham.

“I don’t know that I want to get back to the way things used to be, to be perfectly honest,” she said. “I’m not sure that was actually healthy for anyone.”

Before the pandemic, her business took pre-orders and opened six days a week for walk-in purchases, requiring bakers to speculate on what and how much to make each day.

Busy seasons or large orders would sometimes mean overnight shifts to have product ready by morning.

Rudderham envisions a switch where the business could focus primarily on pre-orders and curbside pickup, giving workers steady hours and eliminating the need to employ counter staff to await drop-in customers.

The economics, she said, would allow the business to focus on larger orders and supplying other retailers like a nearby co-op, instead of hoping for people to walk in for a coffee or muffin.

Rudderham isn’t sure how many of those ideas will be implemented, but insists deep thought is key to any recovery.

“This is a chance for everybody to reassess what is really important about the way we live our lives and how we run our businesses because the normal that existed before the pandemic is not a normal that was working for everyone.”


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Holiday socializing 2.0: Eat, drink and be wary

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With the constant uncertainty and change that is prominent in a COVID-19 environment, it is vital that we look towards the face of this new reality and consider how we might adapt upcoming fall and winter celebrations.

Undoubtedly, foods and beverages will remain at the centre of these celebrations, particularly during the upcoming treat-focused Halloween 2020 season and into the myriad of winter social occasions. But, how might COVID-19 crisis-inspired habits impact treat choices?

It’s challenging at the moment to forecast too far ahead.

However, barring any dramatic progress, it is likely that far fewer kids will be heading out on the evening of October 31st to gather goodies throughout their neighbourhoods, particularly as public health officials continue to promote necessary social distancing and warn of probable infection resurgences.  

These notifications and warnings have led to a third (34%) of Canadian parents reporting (as seen in the Ipsos Path Forward Study) cautiousness towards permitting their children to participate in group activities of any kind, even after the pandemic restrictions ease.  

Screen Shot 2020-10-19 at 1.42.08 PMNotably, even before our lockdown confinement in mid-March, Ipsos FIVE data had revealed that trick-or-treating activities and consumption rates of seasonal favourites at Halloween were already on the decline in 2019—almost a 10% drop in eating rates from Halloween 2016. 

Given this trend, which has likely accelerated during COVID-19, perhaps there is opportunity to re-invent or modernize Halloween and other holiday rituals.

Online celebrations

More than half of Canadian parents (54%) report that they intend to continue to meet with friends and family virtually even when COVID-19 related closures and restrictions end—Zoom socializing has been met with tremendous positivity.

These virtual sharing events open up opportunities to prepare, decorate and engage with other family and friends within safe distancing protocols, while still enjoying activities, games, crafts and, of course, food.  For instance, in order to elevate the fun factor, individual treat baskets could be assembled and shared for kid (and adult) participants.

Stock up on baking supplies

Although increased baking rates that were front and centre during the early-lockdown days receded somewhat by summer, still more than a third of Canadians (37%) now report that they will continue to bake more often than they did during the pre-pandemic period, motivated by the following benefits:

  1. More time to bake
  2. Baking gives me a sense of accomplishment
  3. I like the taste of home-baked goods
  4. Baking makes me feel comforted
  5. I like the smell of home-baked goods
  6. Fun activity for my children

Given the discovery (or the re-discovery) of the joys of baking, there is a significant opportunity to capitalize on this renewed behaviour by creating Halloween-inspired baking fun through the establishment of programs and promotions that include great-tasting recipes, activities and fun kid-driven preparation and decorating ideas. These same strategies, with the right seasonal twist, can be applied also to the winter holiday season, including Diwali, Christmas and into Valentine’s Day.

Small gatherings to centre on favourite foods

Screen Shot 2020-10-19 at 1.41.49 PMEvening celebrations offer an opportunity to decorate the inside of the house and, in the case of Halloween, for instance, host a ‘dinner in the dark’ celebration with one bubble or circle of family and friends.

Parents can have kids participate in the dinner preparation and ensure that it includes their favourite dishes. C-stores can help by stocking the right products for busy families.

 

Undoubtedly, given the gravity of the current COVID-19 environment, it is inevitable that Canadians will be forced to re-think the many components, habits and traditions of our holiday rituals. Of course, we might also want to reflect on what parts of the old ways of celebrating did not necessarily work well, and use this as an opportunity to innovate and change.

Our current forced societal limitations have not squashed our unending spirit and collective creativity, just the reverse.  It is the challenges that we face that spark necessary change and often force us to think outside the box.  It is precisely that mindset that both inspires us and keeps us moving forward. 

Screen Shot 2020-01-16 at 3.49.27 PMKathy Perrotta is a vice-president with Ipsos Market Strategy and Understanding, working with the Food & Beverage Group Syndicated Services.  Data sources within this group include, Ipsos FIVE and Foodservice Monitor (FSM). Ipsos FIVE is an ongoing daily tracking of consumption behaviour, attitudes, situational dynamics, health statuses, preparation and shopping habits that influence item choice for more than 20,000 individuals annually across all dayparts, categories/brands and venues. Ipsos FSM is a daily tracking of purchases, habits and motivations at all foodservice segments and at branded operators among more than 36,000 individuals annually. 


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COVID-19 can remain on bank notes and glass surfaces for 28 days: Study

Research emphasizes the importance of hand washing and stringent in-store cleaning regimes

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Coronavirus may remain for weeks on bank notes and glass surfaces, such as touchscreen, according to new research from the Australian Centre for Disease Preparedness.

The study, which set out to examine the “effect of temperature on persistence of SARS-CoV-2 on common surfaces” shows the virus is “extremely robust.”

Polymer bank notes (like the ones used here in Canada), de-monetised paper bank notes and common surfaces, including brushed stainless steel, glass, vinyl and cotton cloth were used as substrates in this study.

The research showed SARS-CoV-2 can survive  for 28 days on smooth surfaces, such as glass on mobile phone screens or self-checkout touchscreens, and plastic banknotes, at room temperature (20 degrees Celsius/68 degrees Fahrenheit), compared to 17 days survival for the flu virus.

According to the scientists involved in the study, “These findings demonstrate SARS-CoV-2 can remain infectious for significantly longer time periods than generally considered possible. These results could be used to inform improved risk mitigation procedures to prevent the fomite spread of COVID-19.

“While the primary spread of SARS-CoV-2 appears to be via aerosols and respiratory droplets, fomites may also be an important contributor in transmission of the virus.”

In essence, these findings reinforce the importance of hand-washing or using hand sanitizer (with at least 60% alcohol) after handling cash, opening doors, using an ATM, self-checkout machines or entering a PIN at checkout: All best practices for c-store operators and shoppers. In addition, the research emphasizes the importance of cleaning commonly touched surfaces, including door handles, fridges and freezers. countertops, ATMs, fuel pumps, car wash equipment and debit machines.


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Front-line retail workers call for the return of COVID-19 pay bump as cases spike

ShutterstockCalls for the return of hazard pay are mounting as workers on the front lines of Canada’s retail industry grow increasingly anxious amid rising COVID-19 cases.

While some companies, including major convenience players in Canada, offered so-called hero pay to essential workers at the outset of the pandemic, most wage premiums ended as the first wave ebbed.

Yet retail workers say morale is lagging as COVID-19 cases spike across much of the country.

Without a pay bump that recognizes the risk of working during a pandemic, they say workers are increasingly calling in sick – leaving fewer staff to enforce rules around mask-wearing and physical distancing.

Some companies have pre-emptively addressed the issue.

Lowe’s Canada said this week it plans to pay a discretionary bonus to all eligible Lowe’s, RONA and Reno-Depot workers.

The Boucherville, Que., home improvement retailer said full-time staff will receive $300 later this month, with $150 for part-time staff. The October bonus is in addition to bonuses paid in March and August, and $2 per hour wage premium paid from April to July.

The Home Depot Canada said it has implemented paid sick leave benefits and is providing workers with an ongoing weekly bonus – $100 for full-time workers and $50 for part-time workers.

Meanwhile, Chapman’s Ice Cream recently made its $2 an hour pandemic pay raise permanent.

Ashley Chapman, vice-president of the Markdale, Ont., company, said the wage top-up was initially conceived as “danger pay” to help get workers back in the door after a two-week shutdown last spring.

But he said given the rising cost of living, making the pay increase permanent for the company’s 750 workers was “the right thing to do.”

“It was an easy decision for a family-owned business to make,” he said, noting that he doesn’t think it’s fair to compare the ice cream maker to larger public companies.

“Everybody who owns shares in our company has the last name Chapman.”

Making the pay bump permanent is something unions across the country are calling for, arguing that the wage premium not only recognizes the ongoing threat of COVID-19 but also pays workers a living wage.

Yet some retailers have argued that they are now operating safely in a “new normal.”

In a June statement, Loblaw Companies Ltd. chairman Galen Weston called it “the right time to end the temporary pay premium we introduced at the beginning of the pandemic.”

“Things have now stabilized in our supermarkets and drugstores,” he said. “After extending the premium multiple times, we are confident our colleagues are operating safely and effectively in a new normal.”

Many workers and unions disagree.

It’s a debate currently playing out in Newfoundland and Labrador, where 11 Loblaws stores under the Dominion banner are shuttered amid an escalating labour dispute.

It’s one of the first collective agreements to be negotiated in Canada since the start of the pandemic, and experts say it could serve as a forerunner for what to expect as other locals go to the bargaining table in the coming months.

Jennifer Green, a front-end cash supervisor at a Dominion in Conception Bay South, said 1,400 grocery store workers have been on strike for more than six weeks in an effort to obtain better wages.

She said without the COVID pay premium, she lives “paycheque to paycheque.”

“A lot of us were really struggling,” Green said. “But when we got the $2 an hour raise, we felt important.”

She said when the pay premium was cancelled, workers felt “sad and upset” and that going into work remained “nerve-racking.”

“It’s been stressful and at times scary,” Green said. “And it’s been really, really busy with online orders and extra cleaning.”

Loblaw did not respond to a request for comment.

Some retail workers have had to deal with aggressive customers, with videos surfacing on social media of shoppers challenging rules around masks and physical distancing.

UFCW Canada spokesman Tim Deelstra said some of the union’s members have been in “disgusting situations.”

“There have been screaming matches,” he said. “Some of our members have been spit on or attacked by members of the public.”

The union is calling for a pay bump to recognize the ongoing efforts and risks taken by front-line workers.

Amanda Nagy, assistant bakery manager at a Fortinos Supermarket in Hamilton – also a Loblaw franchise – said she’s worked throughout the pandemic but is now growing increasingly nervous.

“It’s really overwhelming when we see the number of cases rising every day,” she said. “Then we have anti-maskers come in or people who claim they have a pre-existing condition and don’t wear masks: It’s just a scary environment to be in.”

Nagy said at the outset of the first wave, many people were calling in sick. She said that changed when the pay premium was introduced.

“It’s just good for the morale to feel appreciated,” she said. “Otherwise we’re basically risking our lives at a job where we can barely make ends meet.”