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Understanding the new food consumer

People’s relationships with food changed this year. The good news? Customers are up for grabs—and our proprietary consumer research backs it up. Businesses that want to win need to start by understanding customer motivations.

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For many of us, the global pandemic has reset our relationship with food. We’ve shifted the way we shop for, purchase, prepare—and even think about—food. Much of this evolved out of necessity: grocery delivery services grew (and got maxed out) because many felt unsafe going into stores; online meat and fish sites flourished; and local butcher shops resurfaced as supermarket chains had trouble keeping meat on the shelves. People who had not been cooking at home learned to cook with YouTube videos and online tutorials, and meal kits surged as restaurants remained closed (even for takeout).

Things have settled down over the last few months: supply chain issues have been solved, in most places restaurants have reopened with new safety precautions (although in some regions they are closing again), and grocery delivery services are operating at a normal pace. But the food landscape has changed and it is not going back to where it had been. The Jackman Human Insights Study, our ongoing, proprietary consumer research study, found that not only are we cooking more (51% of respondents say they’re making more meals from scratch), but most of us (91%) plan to keep up this increased level of home cooking for the foreseeable future.
The old model of competition for foodservices businesses was based on price, place, product, and promotion. But this is not enough to win anymore. To succeed today, businesses need to understand their customers on a deeper level and remember that while some see food merely as nourishment or fuel, for many it is so much more. Historically, in addition to nourishment, food has been considered a form of self-care, indulgence, and a way to connect with others. While that is still the case, during this pandemic food also became a way to experiment, discover, and embrace self-sufficiency for many who had not thought this way before.
Those in the food industry need to identify who their consumer is and what drives them.
Below, we focus on two different groupings of prevalent consumer segments identified in our research — The Planner and The Budget Conscious, and The Adventurer and The Trend Seeker. Here’s how to engage them:
The Planner and The Budget Conscious
Motivated by fuel and convenience.
The Planner seeks routine, structure, and familiarity, especially now as the world seems to be changing at a rapid pace. These shoppers stick to the rules and make thoughtful and controlled decisions. While they prefer to watch and learn from others, they would rather not pay for services if they can do it themselves. As their name suggests, The Budget Conscious tend to prioritize price. They prefer to do things they are familiar with and much like The Planner, they watch and learn from others. Budget conscious consumers also prefer to get their shopping done in one stop.
Three keys to engaging these consumers: 
1. Keep it Simple
These shoppers prefer to stick with simple, quick, and even pre-measured meals and are not paying all that much attention to the details of where or how a product is made. They are not looking for organic vegetables or ingredients they can’t pronounce, they just want a grocery store with conventional produce and good premade meals. Going back to the basics can work with this crowd.
2. Focus on Brick and Mortar
The Planner and The Budget Conscious are highly unlikely to subscribe to a meal-kit service or order groceries online. Businesses looking to engage these consumers should put effort into the in-store experience to help create loyal repeat customers.
3. Emphasize Convenience
Shoppers in these segments tend not to see food as a way to bring people together and are not particularly invested in the food journey. For them, food is simply nourishment. Before the pandemic forced the city into lockdown, Amazon Go worked to engage these consumers in San Francisco with a stand-alone store filled with ready-to-eat foods (like burritos, salads, and sushi).
The Adventurer and The Trend Seeker
Motivated by connection, creativity, and discovery.
Shoppers in both of these segments enjoy discovering and trying new things. The Trend Seeker shops at speciality retailers. They are most likely to accomplish something as part of a big group but are also very willing to pay someone to do tasks for them. In contrast, The Adventurer is likely to be a risk taker who would rather try doing something themselves than learn it from others. They, too, prefer specialty stores and when shopping, and they prioritize quality over price and convenience.
Three keys to engaging these consumers: 
1. Take a Multi-faceted Approach
These customers are engaged with all aspects of the food journey, which means they are interested in cooking and open to new ways of accessing food. Businesses need to engage these consumers in all possible ways—like Panera Bread did in the early days of the pandemic. When physical cafes started to close, Panera launched curbside ordering and pickup in just two weeks. And, when it became clear that customers were having trouble finding ingredients to cook at home, the company rapidly launched a grocery delivery service.
2. Focus on Innovation
These are the consumers that have been most excited to experiment with new food during the pandemic and continue to get creative with their meals. Find ways to engage them such as meal kits that rotate by cuisine or a section of the grocery store dedicated to a different cuisine each week offering prepared meals, as well as ingredients and recipes, to make it at home.
3. Enhance Complexity and Creativity
The Adventurer and The Trend Seeker like experimentation and are willing to prepare complex meals. They would appreciate learning to make craft cocktails online or picking up a kit with all needed ingredients and then hopping on Zoom for a virtual cooking session with local or international chefs. They also want to engage with local businesses—like small butcher shops or restaurants—so partnerships are important.
While it is true that consumers’ relationships with food have changed rapidly this year, we at Jackman view this as an opportunity. In our study, 41% of consumers said they are still experimenting with new brands or types of food. That’s great news—and means that new customers are up for grabs. Businesses that want to win these new customers and develop long-term loyalty need to start by understanding these consumers’ motivations for engagement with food and then finding innovative, ongoing ways to fulfill those needs.
Stefan Read is VP of engagements at Jackman Reinvents. An advisor to consumer brands, retailers, B2B companies, and private equity partners for more than thirty years, Jackman has proven invaluable to leaders intent on sharpening strategy and orchestrating insight-led reinventions of their businesses.

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How to prevent disruptions in food supply chains after COVID-19

By John G. Keogh, strategist, advisor, academic researcher, University of Reading

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Almost all businesses involved in the food supply chain have experienced effects ranging from a mild shock to severe disruptions during the COVID-19 pandemic, and further disruptions may be ahead during the second wave.

Yet not all organizations have learned critical lessons, and history shows us some companies are destined to remain unprepared for the next waves.

Many companies have taken decisive action to survive the pandemic and enhance their supply chain resilience. In doing so, they are protecting their interests and those of their business customers or consumers. We believe that successful firms are taking what’s known as a systems thinking approach to enhance food supply chain resilience.

In the systems engineering world, systems represent the interconnected complexity of ecosystems that are connected both internally and externally.

For example, a food production business is connected to numerous ecosystems internally and to those of their suppliers, business partners and customers.

Businesses have varying degrees of inter-dependence on infrastructure ecosystems outside of their direct control, such as the power grid, telecommunications and internet service providers. Other ecosystems include banking and insurance, logistics and technology providers and various levels of government that provide inspections, permits and approvals.

The cascading consequences of an outage, failure or cyberattack in any one of these interconnected ecosystems can be catastrophic for any food business.

Snowball to an avalanche

When a seemingly small disruption occurs within a company – such as a production line stoppage – the impact may be felt far and wide in the food supply chain. We can view a disruption like a tiny snowball that starts to roll down a mountain and may result in a catastrophic avalanche.

Disruptions can result from actions or decisions of individuals, departments or organizations. For example, in Canada, the government food safety inspectors union, citing health and safety concerns, refused to allow its members to enter meat-processing plants experiencing COVID-19 outbreaks.

Like the aforementioned snowball, this decision contributed to a disruption – the plant’s closure – with complex, unintended and potentially devastating outcomes and far-reaching implications, including domestic beef supply and exports. The outbreaks in geographically concentrated meat-processing plants in Alberta resulted in approximately 75% of the Canadian beef supply going offline when three Albertan facilities closed temporarily.

That disruption sent ripples through food services and grocery businesses nationwide and resulted in consumer concerns about food security and increasing prices.

It’s been noted that Canada’s failure to invest in and adopt digitalization accounted for 85 per cent of the technology investment gap between the United States and Canada, and has contributed to Canada’s lagging productivity. When that lack of digitalization is coupled with poor interconnectivity among supply chain ecosystems, it results in food uncertainty concerns.

Food uncertainty is knowing we have enough food but without the visibility to know where it is in the supply chain. These concerns have led to calls for enhanced supply chain resilience through digitalization.

Avoid internal silos

To enhance food supply chain resilience during the pandemic, companies should be using systems thinking to consider the unique requirements of food supply subsystems (livestock, for example) and to prepare for potential systems shocks in these interconnected ecosystems.

We believe it’s vital to look through a systems lens to understand how future food chains should interact and how risk should be managed. This is particularly critical as we confront a second wave of COVID-19 and the threat of additional disruptions.

Many organizations have internal silos that barely communicate with other divisions or subsidiaries often dependent on their decisions or output. Using the metaphor of the snowball, without an adequate avalanche detection system, organizations are at a higher risk of a shock or significant disruption.

That’s mainly because timely, actionable information is not being captured and shared within and across organizations, and because no one has contemplated the potential cascading consequences of interconnected system failures.

Digitalization and systems thinking

Systems thinking can help organizations to visually map their business’s ecosystems landscape. Once this is done, they can examine or simulate where a failure or system shock may come from.

A business should assess its foundational requirements as it determines how to use technology to provide early warnings of potential disruptions.

When businesses apply advanced or predictive analytics tools, such as artificial intelligence and machine learning, these tools can provide invaluable pre-alerts of potential disruptions before they happen, and allow for a course correction. This is akin to GPS warning a driver of an obstacle on the road ahead or traffic congestion with a suggested change of route.

In the figure below, we build on 2013 empirical research from logistics scholars John R. MacDonald of Michigan State University and Thomas M. Corsi of the University of Maryland by visualizing these advanced warning systems that we call tripwires and circuit-breakers.

The circuit-breakers are analogous to the GPS providing a suggested change of route _ they help companies correct a disruption before it cascades out of control. For example, closing a food-processing plant for sanitization purposes to address an outbreak is a circuit-breaker intervention.

Advances in technology require organizations to continually adapt to new ideas, innovations and methodologies. There is no doubt that many businesses employ brilliant people and technologies, and they just work fine in everyday situations.

Unfortunately, we’re living in an unprecedented era of social and economic turmoil and must react accordingly with a strategic, holistic, agile systems view. For food chain resilience, that approach must include integrated early detection alerts and rapid course-correction capabilities.

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This article was co-authored by Karen J. Hand, founder and president of Precision Strategic Solutions in Guelph, Ont., and Carl “CJ” Unis, systems engineer at Sandia National Laboratories in Albuquerque, N.M.


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Consumer insights: Coping through food

Screen Shot 2020-08-16 at 6.47.16 PMAs Canadians entered 2020, they could not have foreseen what the new decade would bring. The lives of all Canadians—and indeed everyone around the globe—have been upended by COVID-19, making the future even more difficult to predict. While predictions at this time are challenging even for the most confident of prognosticators, companies and brands can look to how Canadian consumers have, thus far, reacted to the current pandemic to map out their plans for moving forward.

At Mintel, we’ve been tracking Canadians’ reactions to COVID-19 since early March. What have we learned? While anxiety levels rose quickly in March, they appear to have levelled off as of mid-May, in terms of consumers’ concerns about exposure and the impact of the virus on their lifestyle. While COVID-19’s impact remains stark, our findings show Canadians are resilient and are adapting to what has become a new normal. Such findings can provide some comfort to grocers in that Canadians are responding to an utterly new shopping experience and have adopted a “search and extract” mentality, with 70% of Canadians making fewer trips to the grocery store and 69% spending less time at stores when they do make trips.

For food and drink manufacturers looking to introduce new products on shelves, these findings represent a challenge. While grocers and manufacturers should by no means shun new innovation, it does highlight the need for brands to be cognizant of what Canadians are going through to inform their innovation and messaging strategies.

Much of the innovation that has taken place in food and drink has related to physical well-being. COVID-19 has accelerated a movement that Mintel has been monitoring, which is food’s relationship with emotional well-being. As Canadians practise social distancing, the link between food and drink and emotional health has never been so important to so many.

For Canadians right now, emotional well-being is manifested in their ability to connect. Our research shows there is no other aspect of life that has taken on a higher priority than staying in touch with family and friends. And when social distancing measures are relaxed, Canadians most look forward to spending time in person with family and friends.

While there’s been a general increase in the number of food and drink launches incorporating ingredients that promote calmness and stress reduction in recent years, food and drink’s more general role in offering comfort at this time is readily apparent. When asked about health and wellness in the context of the COVID-19 pandemic, just over a quarter of Canadians say they are eating more indulgent food and drinks to help (them) cope, which is slightly ahead of the number of Canadians who say they are taking more supplements/vitamins to help boost immunity. These findings suggest Canadians are looking to balance their emotional health with their physical health.

Feedback also shows that nearly half of Canadians claim to be cooking more from scratch, and while this is undoubtedly influenced by the fact Canadians are eating out less, it can be argued that cooking can be therapeutic in a time of great uncertainty. In this context, baking’s surge should come as no surprise given that 86% of Canadians who bake agree that baking for someone is a way to show love, while three-quarters agree that baking with family/friends allows them to connect emotionally.

A path to relevance in an era of uncertainty is in providing consumers with a sense of grounding. Brands that help consumers tend to their emotional needs in addition to their physical needs can come through this tumultuous time in an even stronger position.

Joel Gregoire is a food and beverage industry analyst. Follow him on Twitter

This article appeared in the June/July issue of Canadian Grocer.


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Canada’s growing food insecurity issue

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StatsCan confirmed what most of us already know: Canada is becoming a hungrier place.

According to a survey conducted by the federal agency in May, almost one in seven (14.6%) Canadians indicated they lived in a household where there was food insecurity in the past month. In 2017-18, a similar survey was conducted and 10.5% of households in Canada felt food insecure.

StatsCan results were consistent with a survey conducted by the Agri-Food Analytics Lab at Dalhousie University around the same time, which found 61% of Canadians felt they had enough food and did not consider access to food an issue. That sentiment was at 72.6% last year, a drop of more than 12%. Alberta saw the largest drop between the two periods at 21.2%. More than 4.1 million Canadians now see access to affordable food for survival as a challenge, compared to a year ago. These are massive numbers. And chances are, the situation may get worse by the time this pandemic is over.

Most surveys will likely continue to point to a changing Canadian food security landscape. The hyper sentiment of food security is largely because many have lost their jobs and most of us face a future overflowing with uncertainty. More than 8 million Canadians applied for the Canada Emergency Response Benefit (CERB), which will eventually come to an end. More than $52 billion has been paid out to Canadians so far. That is a third of Ontario’s entire budget.

What will likely make matters worse are food prices. The current food inflation rate is at 3.4% and could reach 4% by year’s end. The food inflation is likely to be much higher than the typical 1.5% to 2.5%. Costs to produce, process, and distribute are all increasing. Physical distancing, personnel turnover, training, double shifts, the use of personal protective gear, equipment modifications, and an increase in the use in automation are all factors contributing to cost increases. To get food to market, companies across the supply chain will need to charge more, full stop.

Grocers may be reluctant to pass on these extra costs to consumers, but eventually they won’t have much of a choice. Here is why: It is assumed that food companies face individual distribution challenges, but this isn’t entirely accurate. COVID-19 has affected the entire system the same way, at the same time. In this context, companies are facing the same challenges, and grocers know that.

The macroeconomic backdrop of this are deflationary pressures that are affecting many other aspects of our economy. Many things are getting cheaper. StatsCan noted that our general inflation rate is currently at -0.4%, a drop of 0.2% from the month before. Clothes, footwear, education and transportation, are many components of the consumer price index that are dropping. Some say consumers are spending less on certain things and thus will have more means to spend on food. Not really.

In the past, grocers have had to deal with a market in which food prices were much higher than the general inflation rate, but nothing like this. COVID-19 proved a simultaneous supply and demand shock, which has never happened before. With lower prices everywhere, expectations will shift and will lead to more frugality in the marketplace. Current market conditions suggest there is less cash in the market. Grocers, other food retailers and restaurants will have to fight to maintain market shares while dealing with higher costs. Fewer stores and fewer SKUs in stores is a likely scenario. There are some investments being made in e-commerce by many players, from farmers to processors to grocers, to help make the entire supply chain much more democratic.

To offset the effects of a higher-than-usual food inflation rate in a deflationary environment will be our grocers most significant challenge. However, some analysts predict our deflationary phase is only momentary and prices should get back into their inflationary groove within months. As people return to work, there will be more money in the economy, and hopefully an inflation rate that we can all afford. It is the only way to make Canada feel less food insecure.

Sylvain Charlebois is professor in food distribution policy and senior director/AGRI-FOOD ANALYTICS LAB at Dalhousie University. He writes for CSNC sister publication Canadian Grocer.


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Refrigeration cleaning tips to protect against COVID-19 and food-borne bacteria

With convenience stores and micro markets declared essential services during the COVID-19 pandemic, your site likely adopted a stricter cleaning routine to prevent the virus spread. This is also an ideal time to look at best practices for food safety, because commercial refrigerators and freezers can quickly become bacterial carriers if not properly maintained. 

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Given the right conditions, bacteria found in food can double every 10 minutes, which means that 1,000 bacteria can grow to 1/2 million about 90 minutes! So, let’s look at how to create conditions where neither COVID-19 or food-borne bacteria can survive. 

Cleaning 101

Research shows COVID-19 can survive up to nine days onmetal, glass and plastic if these surfaces are not properly disinfected. While it can be tempting to saturate your refrigerated units with a strong cleaner like bleach or ammonia, don’t, as these products can contaminate food. 

Instead, use a soft cloth with a non-abrasive liquid detergent cleaner mixed with water. Soap and water are proven to eliminate the virus, as soap interferes with the fats in the virus shell, which lifts the virus from surfaces and is then rinsed off with water. (This is also why frequent handwashing is effective at preventing the virus spread.)

We recommend deep cleaning your refrigeration units monthly, but exterior door handles and doors are high-traffic areas and should be wiped down several times a day. While most sites these days have hand sanitizer available for customers to use at the checkout counter, it’s also a good idea to provide hand sanitizer or sanitizing hand wipes (with at least 70% alcohol content) directly beside any refrigerated merchandisers.

Before deep cleaning your unit’s interior or exterior, always unplug it. Neverapply or spray any undiluted cleaner directly to the unit, since excessive liquid can seep into the electrical connections and cause a malfunction or electrical hazard. To avoid any contamination, ensure all cleaning materials are cleaned themselves (for instance, use a fresh cloth each time) and stored so bacteria is not transferred from one surface to another. Also, keep cleaning equipment for refrigeration units separate from those used for floors or other store equipment.

Cleaning also gives you a chance to inspect the unit for any damage. For example, when wiping down the door gaskets and glass, check for gaps or tears in the gaskets, which can cause air leakage or a build-up of dirt or grease. If you’re not able to snap them back into place, they need to be replaced. Most units are self-defrosting, but if you have manual defrost units, follow the manufacturer’s instructions—regular defrosting is essential, as it helps prevent serious damage to compressors. 

If your unit has a conventional condenser, it should also be cleaned monthly to avoid breakdowns caused by an overworked motor. To clean it, remove the front grill, switch off on the control panel and unplug it, then use a small, hand-held duster to clean inside, and, if necessary, a vacuum cleaner for any additional debris. Don’t forget to reattach the front grill, which helps to protect the condenser from debris and damage.Some units are built with low maintenance condensers, which require regular visual inspections and much less frequent cleaning than conventional condensers.

 Freezers need to breath

Screen Shot 2020-06-11 at 10.41.35 AMWithout optimal airflow, you risk a blocked condenser, which can result in equipment failure, overheating, spoiled product, higher electrical costs and even a possible void on your warranty. 

  •     Position each unit away from the surrounding walls
  •     Ensure each unit has a dedicated electrical outlet 
  •     Situate away from other equipment that radiates heat or produces airborne oil and grime
  •     Inspect regularly to check for blockages 

In addition, distribute the product evenly inside the unit, as overloading blocks interior airflow, which can lead to spoiled food and equipment damage. Cabinets are also better able to maintain a stable temperature if they’re stocked, but not overstocked, versus empty, as the thermal mass of the refrigerated or frozen products helps to maintain the interior temperature.

Temperature matters 

Technically, a refrigeration unit can’t get a “fever”, but temperature variations are a serious threat to food safety, potentially contributing to bacteria growth, pathogens and cross-contamination. 

In an environment where doors are being opened and closed frequently, maintaining optimal temperatures within the unit is crucial. For example, chilled foods, such as sandwiches should be kept within the 37°F to 41°F range. Short spikes, not exceeding 30 minutes, above 41°F are acceptable. 

 If you do not have a temperature malfunctioning safeguard, you should aim to monitor temperatures frequently each hour to make sure they are within the healthy range. Since you need to sanitize the handles on merchandiser doors often, you can do both cleaning and temperature monitoring tasks at once. 

 Randy Skyba is the vice-president of sales and marketing at Minus Forty Technologies in Georgetown, Ont. He helps retailers merchandise their frozen and refrigerated products.


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Cause for concern

Even in these times, barely a day goes by where there’s not a dire warning about the environmental predicament the planet faces. Climate change, for many, is no longer about what might happen, but rather what is happening. Extreme events ranging from hurricanes to rampant bush fires are becoming the norm. For Canadians, this raises the question of how their food purchases impact the environment.

Mintel’s recent report on Sustainability in Food looks at how Canadians view the connection between what they eat and the impact of that on the environment. The research also looks at what specific issues matter most to consumers, why they matter, what consumers expect from companies in the context of sustainability, and what actions they are willing to take.

Canadians do, indeed, say the environment matters to them when it comes to the food and drinks they purchase, and they are particularly motivated by a sense of personal responsibility and a pervasive concern about climate change. That said, Canadians don’t always make a clear connection between climate change and the food they eat; instead, waste ranks as their top concern—this includes both packaging waste and food waste. Fewer Canadians, however, consider carbon output when purchasing food. This makes sense because waste, of course, is visibly evident in one’s day-to-day life. It can be seen in one’s trash, recycling or compost bin, and also translates, in the consumer’s mind, to wasted money. Carbon generated through food production, by contrast, is invisible.

Younger Canadians are, however, more likely to make the connection between how their food is produced and the carbon footprint it generates, and they are more apt to express concerns over these categories. For instance, the younger generations—gen Zs and millennials—are more likely to be concerned about the impact of meat and dairy on the environment; we can presume this relates to the carbon emissions associated with the production of these products. Such concerns have undoubtedly underpinned the growth of plant-based foods and drinks.

More broadly, companies are in a quandary when it comes to their efforts to support the environment. On one hand, four in five Canadians agree that food and beverage companies are not doing enough for the environment. On the other hand, the same number of Canadians believe many companies engage in “greenwashing” and believe them to be untruthful regarding environmental claims. There’s also an element of confusion, with 80% of Canadians also claiming they’re confused when it comes to knowing which products are better or worse for the environment. The question is how to win consumers’ trust?

While there’s no easy answer to this question, initiatives that are visible and engaging can help build their level of trust. One practical way is to ensure shoppers can easily recycle the packaging from the products they purchase. This can include making them compostable or communicating a plan to extend the lifecycle of a package through “upcycling” initiatives. Other initiatives can involve using foods that would have otherwise been discarded in new packaged goods (for example, misshapen potato chips) or focusing on foods produced locally, which offers the dual benefit of supporting the environment and local economies.

When it comes to promoting sustainability in food, there are no shortcuts. But what is evident is that despite some skepticism, shoppers do view sustainability as an issue influencing their food and drink purchase decisions.

Joel Gregoire is a food and beverage industry analyst. Follow him on Twitter 

This article appeared in Canadian Grocer‘s May 2020 issue.


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Food manufacturers ‘operating 24/7’ to meet consumer demand

Screen Shot 2020-04-20 at 5.18.22 PMCampbell Soup Company’s production goes into overdrive during what executives dub “soup season.” Starting in October and ending with the close of winter, Campbell’s manufacturing centres run non-stop, staffed by extra employees.

Since the arrival of the COVID-19 pandemic, consumer demand has soared, eclipsing that of the company’s busiest time. In March, there were more orders during one week than are typically seen in the entire month.

“Our plants are operating 24/7 right now, which is fairly unusual for April, to be honest,” said Beth Jolly, vice-president of communications at the company’s meal and beverages division, which includes Campbell Canada. “It’s really just been a dramatic shift to a full-out production increase.”

Demand for food, particularly non-perishable products, has surged as physical distancing measures keep Canadians close to home. Grocers are ordering more from manufactures, who like Campbell have hired more workers, increased operating hours and enacted other measures to increase production.

At Campbell’s, weekly case orders for that one week in March jumped about 366% at the company’s meal and beverage division, Jolly said.

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Kraft Heinz Canada, meanwhile, reported an 80% increase in demand for its signature Kraft Dinner product last month compared to March 2019, the company says.

To meet that demand, both manufacturers had to make several changes to ramp up production.

Kraft’s Montreal-area production facility – where more than 90% of its food for the Canadian market is produced – now operates 24 hours a day, seven days a week, said Av Maharaj, chief administrative officer for Kraft Heinz Canada.

The company is considering new ways to increase efficiency. It may prove simpler to produce only one type of packaging for Kraft Dinner rather than a variety of box designs, Maharaj said.

“From an efficiency perspective _ you don’t want to stop your line, change packaging, build out the other one for a smaller packaging line,” he said. “But rather, produce the most popular brand, popular size and that gets more product to the market.”

More difficult is changing production lines. Demand is down from food service clients, such as restaurants and hotels. But transforming a food service production line to one making grocery products is not so simple.

“In many ways, it’s like, you know, a giant Lego system where every piece is connected,” said Maharaj.

It can be very expensive to switch a production line and take months to do, he said.

“You can’t sort of switch overnight from one product to the next.”

The company has been in talks to see if any of its food service products, such as single-serve peanut butter packets, can be sold at grocery stores.

Campbell’s, meanwhile, is trying to focus more on its most popular varieties of soup.

“It’s a bit of a balance,” said Jolly, since the company has to ensure it has enough ingredients to match the increased production.

“It’s not as if we can just put out chicken noodle and tomato.”

Campbell’s also dipped into its existing stockpiles. The company had about 1.5 million cans with limited-edition Andy Warhol labels ready to release in May, but decided to forgo the promotional activity and release the product in April to address demand.

These changes allowed the companies to make more of their products quicker.

Kraft typically makes about seven million Kraft Dinner boxes a month, according to the company. Last month, it made roughly 15 million.

Once the product is made another challenge is getting the extra goods to distribution centres and eventually grocery stores.

“Most food manufacturers don’t own their own trucks,” said Maharaj, and Kraft hires local trucking firms to transport its goods from production facilities to distribution centres.

“Very often, that can be a bottleneck because everyone needs trucks right now to get food out the door,” he said, noting the company’s logistics team has been working hard and “for the most part, we’ve been able to find the trucks that we need.”

In some cases, Kraft is bypassing distribution centres entirely and instead shipping straight to grocers.

“That’s one of the ways we’re speeding up getting product to customers.”


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Canada has enough food, but COVID-19 brings challenges

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Higher prices and less variety on store shelves is a possibility as the agriculture industry confronts a wide range of challenges created by COVID-19, the federal agriculture minister said Wednesday.

Agriculture Minister Marie-Claude Bibeau said she’s confident the country had enough food and stopped short of suggesting Canadians start growing war-era “victory gardens” to supplement their own supplies.

But everything from a potential labour shortage on farms to COVID-19 outbreaks among workers at food processing plants will have an impact, she said.

“I think our system is strong enough and resilient enough that it will adapt, but these days it is particularly challenging,” Bibeau said during a video news conference Wednesday, where she fielded questions from her home in Sherbrooke, Que.

“I do not worry that we will not have enough food,” she added.

“But we might see some differences in the variety and, hopefully not, but maybe in the prices as well.”

The federal government has announced millions in new spending for farmers this week alone, including $20 million for the Canadian Food Inspection Agency so it can have enough inspectors on hand to carry out its work.

The funds are partially designed to guard against the potential for CFIA inspectors to be stricken with the virus and be unable to work, further slowing down an already struggling supply chain.

The other labour issue facing the industry is a farm worker shortage. Some 60,000 temporary foreign workers come to Canada annually to work on farms and in plants but border closures mean fewer are expected this year.

They are also required to quarantine for two weeks upon arrival, and this week, the federal government announced $1,500 per worker to help employers cover salary payments or revamp living quarters to ensure workers can abide by distancing protocols.

Checks on those measures will be carried out by local, provincial and federal authorities, Bibeau said.

The arrival of temporary foreign workers is being stymied by global travel restrictions, and what’s ordinarily an annual shortage of several thousand workers is likely to be made worse, Bibeau said.

The government is examining efforts to get unemployed or under-employed Canadians into jobs on farms, she said.

That’s despite the fact that the very reason the temporary foreign worker program exists is due to Canadians not wanting those jobs–and farmers don’t necessarily want to hire them either, as the work can require extensive training. Many workers return to the same area every year because they’ve developed a specific skill set.

“It’s a challenge, but we have to do even more to encourage them to join the industry,” Bibeau said of the workers the government hopes to recruit.

Another issue facing the sector is outbreaks in processing plants. An Olymel pork processing plant northeast of Montreal reopened this week after the spread of illness among its workers forced a two-week shutdown.

The Cargill Meat Solutions plant south of Calgary, which represents more than one-third of Canada’s beef-processing capacity, announced this week it was idling its second shift of workers.

The union representing those staff said there had been 38 cases of COVID-19 at the plant in High River, Alta.

Bibeau said she is reviewing a pitch by the cattle industry to help weather the crisis. The Canadian Cattlemen’s Association wants a federally co-ordinated “set-aside” program that would enable producers to keep their animals longer.

The program would slow down the supply chain because there’s not enough processing capacity, the group has said.

The Conservatives called Wednesday for Bibeau to immediately implement that program and be far more transparent about what else the government is examining.

“Farmers, producers and processors work hard day and night to ensure that Canadians have the food they need while they stay home,” three Conservative MPs who work on agriculture issues–John Barlow, Richard Lehoux and Lianne Rood–wrote in a letter to Bibeau.

“These hard-working Canadians need to know that their jobs will be safe during this pandemic and that they can continue to produce world class products.”

Agriculture group wants Ottawa to prioritize aid to ensure food supply

The Canadian Federation of Agriculture says Ottawa should make the industry a priority during the COVID-19 pandemic, second only to the health of Canadians, to safeguard the country’s food supply.

President Mary Robinson told a news conference Thursday that the industry is struggling with farmers being hit by higher costs due to the pandemic and a shortage of temporary foreign workers.

“We do not mean to create panic. At the same time it would be irresponsible not to sound the alarm about the realities Canadian farmers are facing,” said Robinson.

“Canadian farmers need immediate, meaningful help from our federal government to continue fulfilling that responsibility. Agriculture, the foundation of our overall food supply, is at this very moment in time at a tipping point.”

Robinson said the federal government needs to establish an emergency fund so producers can overcome mounting costs. She didn’t specify how much money should be put aside.

“Canadian farmers are feeling increasingly stressed. In fact, right now, some farmers are so worried about the mounting challenges they are strongly considering halting their farming operations altogether,” Robinson said.

“Another fear is if planting does go ahead will harvest and processing be possible without sufficient labour or will crops rot in the field as we are seeing now in other countries?”

She warned that consumers could see a decrease in the amount and variety of food in grocery stores, as well as higher prices, if action isn’t taken.

Federal Agriculture Minister Marie-Claude Bibeau said the government does recognize the importance of the agriculture sector and has provided a substantial amount of assistance already. She said Ottawa will look at the request.

“As our food producers and supply chains continue to adjust, we welcome recommendations provided by the sector as we work together to respond to the exceptional situation we are in,” Bibeau said in a statement.

“Farmers and food businesses are doing a huge service to feed the nation and they can be confident that their government has their back.”

Bibeau also spoke Thursday with United States Secretary of Agriculture Sonny Perdue. She said she affirmed agriculture and food production as critical infrastructure and they spoke of the importance of uninterrupted food and agriculture trade between the two countries.

The CEO of Food Products of Canada is backing the demand for further assistance.

Michael Graydon said farmers represent the first line of Canada’s food supply and need to be reassured.

“Anything less will harm our rural communities, cities and all Canadians now and well into the future,” he said.

“It’s an unprecedented challenge. We’ve worked hard to keep up with record spikes in demand for foods, help employees stay healthy and upholding the most rigorous food safety standards.”


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Plant-based protein companies poised to expand products

Screen Shot 2019-12-29 at 2.45.10 PMWhen A&W started serving Beyond Meat veggie burgers at its restaurants, the fast-food chain offered many patrons their first bite of the much touted, celebrity backed plant-based patty.

In the year and a half since, Canadians continued searching for plant-based options at home and on the go. By the time A&W added a plant-based nugget in December, many fast-food chains – even long-time holdout McDonald’s Canada – boasted a trendy vegetarian menu item, too.

As restaurants jumped on the plant-based protein craze this past year, the products also proliferated on grocery store shelves.

Earlier this month, Beyond Meat announced grocers across the country would start stocking its Beyond Beef product, which mimics ground beef. It launched its burgers in the summer and they’re now sold at more than 4,000 stores in the country.

Lightlife, meanwhile, boasts seven plant-based protein products with national distribution in Canada, and Field Roast Grain Meat Co. makes about four that are sold in many parts of the country. Both brands belong to Chicago-based Greenleaf Foods SPC, a wholly-owned, independent subsidiary of Mississauga, Ont.-based Maple Leaf Foods.

Kicking off the trend, Health Canada revealed a new food guide in January recommending people “choose protein foods that come from plants more often.” It minimized meat’s dominant position in the previous iteration and put the meat industry on the defensive for their share of consumer plates.

As interest in alternative protein grew, backlash bubbled.

But the folks leading major plant-based manufacturers say consumers want their products and plan to add more varieties and sales points, create tastier options and lower their prices to beat out bargain meat.

A&W sparked a consumer frenzy when it debut the company’s veggie burger in July 2018. The chain temporarily sold out of the patties, having under-estimated people’s appetites.

That sales spike wasn’t a flash in the pan, either. Demand “stayed remarkably stable” since that temporary shortage, said chief executive Susan Senecal.

A&W added a new veggie option this month – Lightlife nuggets. Only its Ontario and B.C. restaurants stock the chicken-nugget imitation, and A&W expects to sell out by the new year. Still, in a sign of the industry’s strength, the company hopes eventually to offer the nuggets nationwide.

“I think there’s a huge opportunity for growth in Canada,” says Ethan Brown, the founder of California-based Beyond Meat.

“We’re just getting started.”

Beyond Meat wants to add more product types and sales points, so consumers can find every type of meat substitution conveniently.

After A&W introduced Beyond Meat burgers to Canadians, other eateries raced to offer something for vegans, vegetarians or – most frequently, it seems – flexitarians. The latter describes those who sometimes swap meat for other options for environmental, health or animal welfare reasons.

Today, many fast-food chains boast a veggie burger, some pizza places offer veggie ground “meat” or vegan cheese as toppings, and Kentucky Fried Chicken Canada dabbled with plant-based fried chicken sandwiches and popcorn chicken options at a single restaurant for one day.

McDonald’s Canada, which long resisted consumer calls to bring back a veggie burger, decided to pilot a PLT – a Beyond Meat sandwich – for 12 weeks, starting in late September, at 28 restaurants in southwestern Ontario.

The company is trying to understand what place plant-based proteins may have in its operations, said John Betts, McDonald’s Canada chief executive.

He believes it won’t canniabalize the company’s meat product sales, but will likely reflect what he calls “the salad effect.” When McDonald’s first introduced salads in the 1980s, it removed what executives dubbed “the veto vote” of someone preventing a group visit to McDonald’s because it didn’t suit their dietary needs or preferences, he said.

“Plant-based protein could be the new salad type of option,” he said, stressing the chain expects the addition to drive up meat sales, which remains the company’s focus.

With burgers, nuggets and other plant-based forms becoming ubiquitous, pushback started. In particular, meat producers are taking aim at claims that alternative proteins offer better health benefits.

The Quebec Cattle Producers Federation called on the country’s food inspection agency to intervene on what it called misleading advertising on Beyond Meat’s products, saying the company shouldn’t be permitted to use the word meat.

The Centre for Consumer Freedom, a Washington, D.C.-based non-profit organization funded by food industry and consumers, took on the issue of what it calls “fake meat.” It launched a website and created advertisements alleging some plant-based protein products use potentially harmful chemicals and can be worse for humans than their meat counterparts.

“It’s unfortunate,” said Beyond Meat’s Brown of the organization’s campaign he says is geared toward scaring consumers from eating food that will benefit them.

The burger, for example, contains no trans fat or cholesterol, and 20 grams of protein, according to the company. It does include 16 per cent of the daily recommended sodium content, which is comparable to a seasoned meat patty.

Beyond Meat will launch a substantial marketing initiative in Canada next year, said Brown, as it looks to grow its presence in the country.

“The products that we have are limited in scope. They need to be improved and we need to expand our market presence.”

He envisions a future where shoppers can select a Beyond Meat alternative for any animal protein cut they were shopping for at the grocery store, such as a boneless chicken breast or steak, and where diners can sample more of its product range at restaurants. Beyond Meat anticipates more partnerships next year.

For some consumers though, the price presents a roadblock. A pack of two Beyond Burgers costs $7.99 plus tax at one Canadian grocery chain, compared with $12.99 for an eight-pack of its house-brand burgers.

Brown aims to lower prices to undercut animal protein within five years, though it may happen sooner in certain segments.

Greenleaf, too, believes there’s room for growth in Canada.


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Food prices forecast to rise 2% to 4% in 2020: Report

Fresh Food Display_Lg_032619Food bills are going to take a bigger bite out of Canadians’ household budgets in 2020. Food prices are expected to increase 2% to 4%, according to the 10th annual edition of Canada’s Food Price Report—a collaborative effort by Dalhousie University and University of Guelph. It predicts that annual food costs for the average Canadian family will rise by $487 from 2019 figures, with the annual tally on food spend reaching $12,667 for the year.

“For grocers, it’s not necessarily bad news to see food prices go up by 4%—the problem is that you may spook some consumers,” Sylvain Charlebois, a professor of food distribution and policy at Dalhousie University told Canadian Grocer. “The sweet spot for food inflation is anywhere between 2% to 2.5% and we’re going to exceed that in 2020 by far.”

Canada’s Food Price Report uses a predictive analytics model that applies machine learning to support decisions about future food prices. In 2019, it was predicted that Canadian families would spend up to $12,157 on food. Based on the 2019 inflation rate to date, they are likely to spend $12,180, missing the report’s target by just $23.

In 2020, meat will see the highest increases (4% to 6%), while restaurants, seafood and vegetables will all see increases of 2% to 4%. This is followed by fruits (1.5% to 3.5%), dairy (1% to 3%), and bakery (0% to 2%).

The jump in the price of meat is due in large part to Chinese demand for imported beef and pork. China recently reopened its market to imports of Canadian pork and beef after a four-month ban, as the Asian country continues to battle African swine fever. China has lost millions of pigs to the disease and needs to import large amounts of pork—driving up the price of pork and meat in general.

“[Meat] is already costing more for processors and grocers and so increases will be passed on to consumers in the New Year,” says Charlebois.

Expected Headlines in 2020

The report also looks at three big stories that will continue to make headlines next year:

1-Single-use plastic packaging: The report states that consumers are placing pressure on retailers, restaurants, distributors and manufacturers to reduce and ultimately avoid the use of disposable plastics used for food products. However, they’re less inclined to pay more for greener alternatives. “[Greener packaging] will incur more costs and this is something consumers will have to get educated about,” says Charlebois.

2-Climate change and carbon tax: In 2020, climate change will have a big impact on food systems and drive up food prices. The report states the government needs to address emissions levels, as they are above the targeted 30% reduction levels beyond year 2030, far from the Paris Agreement goals of 2016. On the issue of the carbon tax, the report notes while some Canadians believe the tax increases the cost of food for consumers, industry is absorbing most of the costs.

3-Retailing AI: The use of artificial intelligence in retail is on the rise. For example, Sobeys is piloting a technology-enhanced cart called Smart Cart.

The cart’s technology scans and weighs products when customers place them in the cart. It displays a running tally of purchases while the customer shops, and then allows them to pay on the spot. Sobeys says it plans to evolve the cart to include additional features using artificial intelligence and machine learning technology. “We are expecting more movement in the area of AI coming from grocers,” says Charlebois.

Originally published at Canadian Grocer.