For growth-minded full-service concepts in the U.S., there are compelling opportunities that beg to be considered just north of the Canadian border.
While emerging markets in Asia, South America, and other corners of the globe attract robust attention, Canada remains a natural—albeit often overlooked—expansion target for domestic-based full serves, particularly given the nation’s geographic proximity, common language, and shared consumer characteristics with U.S. residents.
Of course, the positive state of Canada’s restaurant scene—a $68 billion industry that accounts for roughly 4 percent of GDP—doesn’t hurt, either. The NPD Group Canada reports that an estimated 47 percent of Canadians over the age of 16 visit a restaurant daily; by contrast, 44 percent of Americans do the same.
Among full serves, which account for one-quarter of Canadian restaurant traffic, promise is particularly high. Though full-service outlets trudged through the economically challenged period of 2009 through 2011, the category has quickly rebounded. Full-service restaurant sales are expected to jump 4.6 percent this year and an additional 5.2 percent in 2015, Canadian Restaurant and Foodservices Association (CRFA) president and CEO Garth Whyte says.
“We’ve got a country where people enjoy dining out,” Whyte says.
As GDP and job growth show a Canadian economy rapidly moving from recovery to expansion—this after already navigating the recession with more aplomb than the U.S.—full-service restaurant brands based in the U.S. will increasingly explore Canadian expansion. And as they do, they’ll discover compelling marketplace opportunities.
Casual Dining Grows Up
During the recession, many Canadian diners traded down to more economical concepts, which sparked strong momentum in casual dining and, in particular, surging growth for chain concepts.
Yet these aren’t your mother’s casual-dining concepts. Appealing to adults more than families, “premium casual” upstarts like Earls Kitchen + Bar, Joey Restaurants, and Moxie’s Grill & Bar carry an upscale, creative vibe featuring sophisticated bar programs, contemporary design, heightened service, and on-trend menus touting healthy dishes, high-quality ingredients, and novel flavors.
“For casual dining, the message is clear: Be more contemporary, more interesting, and have more flair,” says Douglas Fisher, a Toronto-based restaurant consultant with FHG International.