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2012 canada market overview presentation

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November 15, 2012 presentation by Food Export Northeast

November 15, 2012 presentation by Food Export Northeast


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  • 1. CANADIAN MARKET OVERVIEW
  • 2. Consider Canada Opportunities #1 bilateral trading partners $1.6 billion trade crosses Canada - U.S. border daily Windsor/Detroit border – most trade flow in world U.S. Top 5 Trading Partners 2010 2011 Country Growth $B $B Canada $249.1 $280.9 12.8% China $163.5 $198.4 21.4% Mexico $91.9 $103.9 13.1% Japan $60.5 $65.7 8.6% Germany $48.2 $49.2 15.4%
  • 3. Consider Canada Opportunities U.S. Exports of “Agricultural Products” Top 5 Countries ($US) 2010 2011 Country Growth $B $B Canada $16.9 $19.0 12.7% China $17.5 $18.9 7.7% Mexico $14.6 $18.3 25.7% Japan $11.8 $14.1 31.4% Korea, South $5.3 $7.0 13.3%
  • 4. Consider Canada Opportunities 2011 Total Agri-Food Imports from U.S. - $19.5 Billion Province Imports % Increase (Million) 2010 Ontario 18,068 8.5 Quebec 5,823 22.8 British Columbia 5,257 6.2 Alberta 2,131 11.0 Manitoba 1,095 18.7 Atlantic Canada 983 10.1 Saskatchewan 399 13.1
  • 5. Consider Canada Opportunities5,000 mile sharedborder with over 120border crossingsClose shippingcorridorsSimilar time zonesIncreasing shippingcosts80% of imports bytruck
  • 6. Consider Canada OpportunitiesCommon culture &language300,000 cross sharedborder every daySnow birdsPositive perception of U.S.products amongCanadiansStrong Canadian $Benefits of NAFTA – dutyfree (excl. poultry, dairy)
  • 7. Consider Canada Demographics – July „11Canadian population: 34.5 millionOntario population = 39%Quebec population = 23%Prairie population = 18%British Columbia = 13%Atlantic Canada = 7%62% of Canadians live in Ontario and Quebecmajority of Canadians live within 140 miles of border
  • 8. Consider Canada Demographics – July „11 Metropolitan area Population (000’s) Toronto, ON 5,838.8 Montreal, QC 3,908.7 Vancouver, BC 2,419.7 Calgary, AB 1,265.1 Ottawa–Gatineau, ON-QC 1,258.9 Edmonton, AB 1,196.3 Winnipeg, MB 762.8 Quebec City, QC 761.7 Hamilton, ON 750.2 Kitchener-Cambridge-Waterloo ON 498.5 London, ON 496.9 Halifax, NS 408.2
  • 9. Consider Canada Demographic TrendsMedian age is 40 yearsPeople over 50 make up 36%of population / control overhalf of the nation’sdiscretionary spending66% of Canada’s growth fromimmigration35% of population &73% of new immigrants -Toronto/Vancouver/Montreal+100 languages in major cities
  • 10. Consider Canada Opportunities Immigrants represent 20% of total Canadian population Group Current Worth Annual Growth +/- Total Non-Ethnic $200 billion $125 million Decelerating rate Total Ethnic $50 billion $1 billion Accelerating Rate Total Present Projected Group Approx 1/3 of Value Annual Growth total ethnic Chinese $200 billion $125 million growth South Asian $50 billion $1 billion
  • 11. Consider Canada Demographic Trends
  • 12. Consider Canada Regional Diversity Region Traits Healthier lifestyle, slower pace, higher disposable income, higher frequency visits to British Columbia upscale restaurants, specialty foods, Asian influence Alberta fastest growing area, baked goods, Prairies comfort foods influence from German / Ukrainian / Polish / Scandinavian backgrounds Multi-cultural, fast-paced, convenience, ready- Ontario to-go, international cuisine European heritage, family centric, less spicy, Quebec sweet-tooth, specialty foods British / Irish / Scottish influence in foods, Atlantic Canada seafood, working class
  • 13. Consider Canada Consumer TrendsHealth & wellnessConvenienceVarietyEthnicRegionalSustainability
  • 14. Consider Canada Retail Market
  • 15. Consider Canada What‟s Hot - Retail Healthy foods – snacks, whole grains, functional, gluten-free, sugar-free, trans fat free, low sodium Meat, fish & seafood – marinated, pre-seasoned Fresh categories – perimeter of store Ethnic foods Natural/organic - value-added, artisanal Uncommon spins on common foods Gourmet comfort foods Environmentally friendly Raw Food Portable Foods
  • 16. Consider Canada Retail Trends Consolidation of market Blurring of boundaries - food and non-food retailers One-stop-shopping gaining popularity Importance of private label 18% of market Environmentally conscious
  • 17. Consider Canada Retail Differences: Canada vs U.S.Canada operates on lowermarginsMost food is less expensivethan in the U.S.25% of Canadians shop atdiscount supermarketsSupermarkets are well-bracedagainst Wal-MartFranchised independents buyfrom one of the major chainsSpecialty retail not asdeveloped
  • 18. Consider Canada Food Store Sales – 2011Channel % ShareGrocery 63.5%Mass 11.7%MerchandisersWarehouse Club 7.8%Drug Stores 7.2%Convenience 6.0%Specialty Stores 2.0%Gas Stations 1.8%
  • 19. Consider Canada Food Store Sales - 2011 Province % Market % Chain’s Independent Share Share of Share of Units Units Ontario 37.3% 39.3% 60.7% Quebec 25.6% 28.7% 71.3% British Columbia 14.7% 31.3% 68.7% Alberta 10.9% 42.4% 57.6% Sask/Man 5.2% 40.6% 61.0% Atlantic 6.1% 38.6% 61.4%
  • 20. Consider Canada Trips Per Household Retail Format Trips Per Trips Per % Change Shopper Shopper of Trips 2010 2009 Grocery 82.5 83.8 -1.6 Supermarkets Drugstores 16.5 17.0 -2.9 Mass Merchandiser 17.2 16.9 1.8 Warehouse Clubs 11.4 11.0 3.6 Convenience/Gas 9.4 9.7 -3.1 Bars Total Channels 137.0 128.4 6.7
  • 21. Consider Canada Private Label in Canada National Grocery Banner and Mass Merchandiser Private Label Share 40 34.4 35 30.8 30 27.4 26.1 25 18.2 19.7 20 15 15 11.3 10 5 0
  • 22. Consider Canada Retail Landscape 2011 food sales: $85.5 billion (+1.2%) top 3 control +69% retail market Retailer 2011 Sales % Market (Billions) Share Loblaw $31.5 38.7 Sobeys $16.3 20.0 Metro Inc. $11.5 14.1 Costco $7.0 8.6 Canada $6.8 8.3 Safeway Wal-Mart $5.2 6.4 Co-ops $3.4 4.2
  • 23. Consider Canada Retail Profile: Loblaw Cos. Ltd.39% market shareDevelopment of “market”stores to provide one-stop-shopping1,027 corporate andfranchised stores376 affiliated independents1,564 independent accounts
  • 24. Consider Canada Retail Profile: Loblaw Cos. Ltd. LOBLAW BANNERS – EASTERN CANADA No Frills (discount) 136 Your Independent Grocer 53 Loblaws 131 Super Valu 2 Axep 128 Zehrs Markets 50 Maxi & Co. 106 Real Canadian Superstore 32 Provigo 70 Fortinos 20 L’Intermarche 63 Dominion 15 Valu-Mart 58 IGA 3 Fresh Mart (Atlantic 58 Real Canadian Wholesale 3 Wholesalers) Club Save Easy 42 Atlantic Superstore 53 T&T Supermarket 7
  • 25. Consider Canada Retail Profile: Loblaw Cos. Ltd. LOBLAW BANNERS – WESTERN CANADA Lucky Dollar 113 Extra Foods 67 Real Canadian Superstore 71 Shop Easy 63 Super Valu 20 T&T Supermarket 20 Real Canadian Wholesale Club 29
  • 26. Consider Canada Retail Profile: Loblaw Cos. Ltd. – Private Label Stores offer more than 5,000 private-label products 45% coverage No Name President‟s Choice PC Organic President‟s Choice Blue Menu President‟s Choice Black Label Additional names by category
  • 27. Consider Canada Retail Profile: Loblaw Cos. Ltd. – Private Label
  • 28. Consider Canada Retail Profile: Sobeys Inc. 2nd largest player National coverage Thrifty Foods purchase Smaller communities Banner consolidation ON to BC Sobeys, Foodland, Price Chopper IGA – Quebec 1,337 corporate & franchise
  • 29. Consider Canada Retail Profile: Sobeys Inc. SOBEYS – NATIONAL Kwik-Way 65 Lawtons Drugs 79 Sobeys 284 Sertard 37 Boni Soir 229 Tradition 29 Foodland 196 Rachelle-Bery 19 IGA 212 Cash & Carry 9 Needs 140 IGA Garden Market 49 Price Chopper 44 Foodtown 27 Le Dépanneur 99 Thrifty Foods 26 IGA Extra 106 Fast Fuel 9 Boni Choix 82 Freshco 57
  • 30. Consider Canada Retail Profile: Sobeys Inc. – Private Label 27% coverage Compliments Compliments Organic Compliments Balance Compliments Sensations Compliments Greencare Signal Gourmet Minute
  • 31. Consider Canada Retail Profile: Metro Inc. 3rd largest player 2nd largest player Ontario/Quebec Quebec – franchised Ontario – corporate/franchise +1,400 corporate & franchise
  • 32. Consider Canada Retail Profile: Metro Inc. METRO BANNERS – ONTARIO/QUEBEC Metro 370 Clini Plus 46 Gem 259 Super C (discount) 78 Extra 206 Service 38 Brunet 124 SOS Depanneur 2 Food Basics 115 Les 5 Saisons 1 Marché Extra (Metro) 206 Marché Richelieu 86 Ami 84
  • 33. Consider Canada Retail Profile: Metro Inc. – Private Label 15% coverage Overhaul of private label  Selection  Irresistible  Irrestistible Life Smart
  • 34. Consider Canada Retail Profile: Costco Canada Inc. Costco West Costco East British Columbia – 14 Ontario (Excl Thunder Bay) – 25 Alberta – 13 Quebec – 18 Saskatchewan – 2 Nova Scotia – 2 Manitoba – 3 New Brunswick – 3 bn Ontario (Thunder Bay) – 1 Newfoundland - 1
  • 35. Consider Canada Retail Profile: Wal-Mart 328 stores 146 Super Centres Pantry Departments Sam‟s Clubs Closed
  • 36. Consider Canada Retail Profile: Target Canada Purchased 189 Zellers stores 1st 25-35 stores Spring 2013 125 – 135 stores by 2014 Sobeys to supply dairy/frozen/perishables/chocolate
  • 37. Consider Canada Specialty Retail Market 63,000 specialty stores), 72% independents 2011 – 47% of stores with increased sales Gourmet food – 12% growth 34% of stores are stocking gourmet food, 30% gift baskets with 31% increasing presence Average price for gourmet food in specialty stores is $6-10 British Columbia leader in specialty foods Quebec second largest buyer of specialty foods
  • 38. Consider Canada Foodservice Market
  • 39. Consider Canada Foodservice Profile - 2011
  • 40. Consider Canada What‟s Hot - Foodservice What‟s Growing What‟s Slowing Smoothies Carbonated Soft Drinks Bagels Hot Coffee Deli Meat Sandwich Doughnuts Iced/Frozen/Slush Coffee Juice Tap Water All Other Sandwiches All Other Entrees (ex Has Browns pork/beef/seafood) Muffins Pork Entrees Breakfast Wrap/Burrito Cookies Chinese/Cantonese/Szechwan Beef Entrees (ex burgers) Hot Chicken Sandwich Seafood/Fish
  • 41. Consider Canada Top Trends – Menu Importance Top 10 Foods Top 10 Beverages French Fries – 15.7% Hot Coffee – 30.6% Chicken/Poultry Entrees – 14.1% Carbonated Soft Drinks – 21.3% Burgers – 10.7% Alcoholic Beverages – 6.4% Salads – 9.3% Tap Water – 6.0% Seafood/Fish – 6.6% Hot Tea – 5.7% Donuts – 6.2% Juice – 5.5% Pizza – 5.8% Bottled Water – 4.2% Hot Chicken Sandwich – 5.3% Milk – 3.5% Chinese/Cantonese – 5.2% Iced Tea – 3.1% Breakfast Sandwiches – 5.2% Iced/Frozen/Slush Coffee – 2.2%
  • 42. Consider Canada Foodservice Trends Sustainability Artisanal Cheeses Simplicity/Back to Basics Nutritional/Healthy Cuisine Bite Size / Mini Desserts Food Trucks/Street Food Ethnic Street Food Inspired Appetizers Gluten-Free/Food Allergy conscious Locally Sourced Food Farm/Estate Branded Ingredients
  • 43. Consider Canada Foodservice Trends – Up and ComingAfrican CuisineBlack GarlicGluten-Free BeerRed RicePeruvian CuisineVegetable CevicheMicro-Distilled/Artisan LiquorGoatGame Bird Appetizers (duck,quail)Savoury Ice Creams
  • 44. Consider Canada Foodservice Profile - 2011 $65.5 Billion Sales Sales ($B)Quick service $22.1Full service $21.9Contract / social $4.2caterersTavern, Bars, Pubs, $2.4NightclubsTotal non $12.7commercial
  • 45. Consider Canada Foodservice Profile  68% of food is prepared and eaten in-home  Approx 8% meals/snacks sourced from restaurant  Average Check / person $7.16  Average Household spent $1,857 at restaurants Type of Service Average Check/Person Quick Service $4.95 Family/Midscale $11.29 Casual Dining $16.17 Fine Dining $41.51 Retail $4.21
  • 46. Consider Canada Foodservice Profile - 2011
  • 47. Consider Canada Foodservice Profile - 2011 #1 #4 #2 #5 #3 #6 Top 6 Chains in Canada
  • 48. Consider Canada Foodservice Profile Province Foodservice Sales 2011 Sales Growth Units (Millions) in ’11 Ontario 30,412 $18,381.6 3.2% Quebec 20,847 $9,876.1 3.0% British 11,984 $7,893.5 1.9% Columbia Alberta 8,843 $6,741.6 3.0% Atlantic 4,981 $3,046.6 1.2% Canada Man/Sask 4,230 $2,818.5 3.4%
  • 49. Consider Canda Navigating Canada - Retail
  • 50. Consider Canda Navigating Canada - Retail
  • 51. Consider Canada Navigating Canada - Foodservice
  • 52. Consider Canada Navigating Canada Distributors and Brokers  More than 800 brokers & distributors  Regional or national focus  Cover retail and/or foodservice  Many require exclusivity  Pioneering/retainer fees
  • 53. Consider Canada Navigating CanadaDistributors Take ownership of product Warehouse products Important for products with limited shelf life (DSD) Distribution channel for smaller retailers Catalogue / online sales Fees: 25 to 35%
  • 54. Consider Canada Navigating CanadaBrokers/Brand Managers Your dedicated Canadian sales representative Represent fewer principles Exclusivity Expertise – regions/stores/ relationship marketing Brokerage fees: 5% average Start-up / retainer fees: Usually first 6 months
  • 55. Consider Canada Market Builder Education is the key to success Market Scan Rep finder  Competitive product shopping  Market visit  Category Review  One-on-one meetings  Distribution analysis  Retail tour  Importation analysis & regulations  Packaging/labelling regulations  Distributor referrals  Importer evaluations
  • 56. Consider Canada 2013 Activities Activity Date CRFA Show – Food Show Plus! March 2011 Toronto SIAL Canada – Food Show Plus! May 2011 Toronto Specialty/Natural/Organic September 2011 Focused Trade Mission Toronto Market Builder Year-round
  • 57. CANADIAN PACKAGING / LABELLING REQUIREMENTS An Overview ofCanadian Packaging and Labeling Requirements 2011 Food Export Marketing Forum
  • 58. CANADIAN FOOD INSPECTION AGENCY Investigating consumer and industry complaints Taking appropriate compliance and enforcement actions related to food safety, labelling and deceptive practices Recall of unsafe products Undertaking preventative measures using a risk based approach
  • 59. CANADIAN FOOD INSPECTION AGENCY Agriculture & Agri-FoodFood and Drugs Act* Administrative Monetary Penalties ActConsumer Packaging & Labelling Act* Seeds ActCanada Agricultural Products Act Feeds ActFish Inspection Act Fertilizers Act Canadian Food Inspection AgencyMeat Inspection Act ActHealth of Animals Act Plant Breeders’ Rights ActPlant Protection Act * as it relates to food
  • 60. LABEL REQUIREMENTS BASIC LABELLINGREQUIREMENTS
  • 61. LABEL REQUIREMENTS Common name Net quantity – metric units List of ingredients Best before date with a durable life span of less than 90 days Nutrition information Company name & address
  • 62. BILINGUAL PACKAGING  English & French Canadian  Everything on a label must be bilingual and of equal size
  • 63. BILINGUAL PACKAGING
  • 64. COMMON NAME Name prescribed by a regulation - examples: orange juice, sausage, chocolate, fish sticks, canned peas If the name is not prescribed by a regulation, then the name by which the product is commonly known – examples: orange drink, chocolate cake 64
  • 65. NET QUANTITY DECLARATIONThe net quantity declaration must appear inmetric units: By volume for liquids; e.g., millilitres, or litres (for amounts more than 1000 ml) By weight for solids; e.g., grams, or kilograms (for amounts more than 1000 g) By count for certain foods, such as hotdog buns. 65
  • 66. BEST BEFORE DATE Must appear on foods with a durable life of 90 days or less Must be accompanied by the storage instructions, if different than the ambient conditions Prescribed format Best Before / Meilleur Avant: 2012 Fe 21 66
  • 67. LIST OF INGREDIENTSMust appear in decreasing order by weight,except :  spices, seasonings, fine herbs  flavourings  flavour enhancers  food additives  vitamins and minerals
  • 68. LIST OF INGREDIENTS The components of the ingredients must be shown, with certain exceptions (such as flour, butter, etc.) Some ingredients may have class names (flavour, herbs, milk ingredients)
  • 69. LIST OF INGREDIENTS
  • 70. LIST OF INGREDIENTSEnsure your ingredients are allowable inCanada. Some additives or colours may not be allowed. The enrichment of food with vitamins, minerals and amino acids is only permitted in some foods such as: Vitamin C in apple juice Fluoride in bottled water Vitamin D in milk Folic acid in flour 70
  • 71. ALLERGENSAn allergen statement must be made onpackaging that contain any of the followingproducts or may contain traces of:Peanuts Sesame seedsTree nuts (specify) ShellfishEggs FishWheat or gluten source CrustaceansSoya Milk & milk ingredientsMustard seed Sulphites (more than 10 ppm)
  • 72. NUTRITION FACTS TABLEMandatory on pre-packaged foods with thefollowing exemptions:  Products with nutrient & energy values expressed as “0”  Beverages with more than 0.5% alcohol  Fresh vegetables or fruits or combinations  Raw, single-ingredient meat, poultry, fish & by-products (except ground meat and poultry)
  • 73. NUTRITION FACTS TABLEExempted products must provide a NutritionFact Table if:  Product has added vitamins, minerals etc.  Product has health claims, nutrient claims  Artificial sweeteners are added 73
  • 74. NUTRITION FACTS TABLENutrient information based onSpecified quantity of food as soldList of calories & mandatoryspecified nutrientsAmounts listed as % daily valueMay have one bilingual table or two tables:one English / one French
  • 75. NUTRITION FACTS TABLESize of Nutrition Facts Table is determined by package face
  • 76. NUTRITION FACTS TABLEFoodservice packages and products forindustrial use do not require NutritionFacts Table on packaging.A Nutrition Facts Table must be availableon paper and sent to customer to have onhand. May be faxed or shipped withproduct. 76
  • 77. NUTRITION FACTS TABLE – U.S. VS CANADA
  • 78. NUTRITION FACTS TABLE – U.S. VS CANADADifferences in mandatory elements Rounding rules Recommended daily intake for calcium, iron & vitamin AMandatory in U.S. / Optional in Canada Number of servings per container Calories from fat % daily value for cholesterol % daily value foot note
  • 79. NUTRIENT CONTENT CLAIMS 47 allowable claims (i.e. source of omega-3, trans fat free, low in sodium) Specified wording for a claim Qualification of claims can be different from U.S. (i.e. trans fats claim) Cannot use the word healthy or imply a claim with a disease Carb free claims are not allowed 79
  • 80. HEALTH CLAIMS7 permitted health claims only with prescribedwording Sodium and hypertension Calcium and osteoporosis Saturated and trans fat and heart disease Vegetables and fruit and cancer Fermentable carbohydrate and tooth decay Replacement of saturated fat with mono- and polyunsaturated fat and blood cholesterol lowering Beta glucan oat fibre and heart disease
  • 81. HEALTH CLAIMSPrescribed wording for health claim ofvegetables and fruit and cancer “A healthy diet rich in a variety of vegetables and fruit may help reduce the risk of some types of cancer”
  • 82. PROCESSED PRODUCTS REGULATIONSFruits, vegetables, sauces, condiments, juices: Have standards of identity Have standardized containers that must be adhered toExamples: Jams/jellies – 250, 375, 500, 750 mL, 1, 1.5, 2, 3, 4 L Peanut butter – 250, 375, 500, 750 g, 1, 1.5, 2 kg
  • 83. ORGANIC PRODUCTS Product must have at least 95% organic content Mandatory certification, by a CFIA accredited certification body – Canada recognizes U.S. accreditors such as QAI Product must bear the name of the certification body that has certified the product as organic Canadian organic logo is permitted
  • 84. LABEL APPROVALS Meat & poultry products must have labels approved by Canadian Food Inspection Agency Natural health products must go through the Natural Health Product Directorate to be licensed and a number is issued that must be on an approved label (i.e. energy drinks, natural supplements) Other products do not require approval
  • 85. RESOURCESCanadian Food Inspection Agency (CFIA)www.inspection.gc.caGuide to Food Labelling and Advertising Chapter 5 – Nutrition Labelling Chapter 6 – The Elements Within the Nutrition Facts TableNutrition Labelling Tool Kit www.inspection.gc.ca/english/fssa/labeti/nutrikit/nutrikite.shtmlQuestions about Packaging & Labeling labelwindow@inspection.gc.ca
  • 86. KATHY BOYCEFOOD EXPORT - CANADIAN REPRESENTATIVEMARKETING / TRADE SPECIALIST731 Laurier Ave. Milton, ON L9T 4R1T 416.523.1470 | F 905.864.4899kboyce@boycemarketing.com

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