Forward Focus for Canada’s Fastest-Growing Restaurants

The restaurant concepts that made Technomic’s 2014 Top 200 Canadian Chain Restaurants list, as ranked by their 2013 Canadian systemwide sales, outperformed the restaurant industry as a whole in Canada last year. Sales for chains in the Top 200 rose 4.2% to $29.2 billion (Canadian), vs. the 3.4% sales growth (to $48.7 billion) recorded by all restaurants.

Within the Top 200, four chains—Smoke’s Poutinerie, Menchie’s Frozen Yogurt, The Works Gourmet Burger Bistro and Panera Bread—achieved remarkable sales increases of 50% or more in 2013. And now that we’re firmly into the second half of 2014, let’s take a look at what these sales growth leaders have been up to so far this year.

Smokes Poutinerie: The Ontario-based poutine specialist came in at No. 99 on the Top 200 list, with 2013 systemwide sales growth of nearly 59% (to $39.7 million) and unit growth of 42%. In 2014, the chain made its Saskatchewan debut with a store in Moose Jaw and has continued to add Ontario stores. On the menu side, new limited-time offers this year have included the Samosa Poutine, with vegetable samosas atop traditional poutine with sweet chili sauce, and Surf ’n Turf Poutine with steak and crab.

Perhaps the biggest headline for six-year-old Smoke’s this year is the launch of the—hold on—World Famous Great Canadian Cross-Country Plaid Gravy Train Fries Curd & Gravy Weird Wild and Wacky Poutine Eating Tour. The traveling poutine celebration kicks off Tuesday and features events in 17 cities in 17 days, with free poutine for attendees and poutine-eating contests starring three professional competitive eaters. Mouthful of a name aside, the tour stands to boost Smoke’s brand recognition in provinces where it has a smaller presence (such as Alberta, British Columbia, Manitoba) and generate some new excitement among the chain’s diehard fans in Ontario.

Menchies Frozen Yogurt: Menchie’s claimed the title of the fastest-growing chain on the 2014 Top 200 list; sales catapulted 154% (to $35.2 million) on nearly-as-strong unit growth. The self-serve frozen-yogurt chain, founded in a suburb of Los Angeles in 2007, ended 2013 with 75 units in Canada and landed at No. 110 among the Top 200.

Menchie’s has continued to expand across Canada this year, surging past 100 stores in nine provinces. Among dozens of menu choices the rapidly growing concept offers are nonfat, low-fat, tart and no-sugar-added yogurt varieties and dairy-free sorbets, and the mySmileage Club gift-card and loyalty program gives guests $5 in Menchie’s Money for every $50 they spend. A strong local focus is part of the chain’s strategy for connecting with customers and fending off competition from other frozen-yogurt concepts popping up nationwide. Each store has its own Facebook page and Twitter account, allowing local in-store events and promotions to take center stage.

The Works Gourmet Burger Bistro: Sales climbed 50% to $30.6 million at Oakville, ON-based The Works Gourmet Burger Bistro, No. 121 on the Top 200. The Works, which closed 2013 with only 26 stores, saw especially robust sales growth for its size.

Beginning in January, a limited-time Believe in Baconism menu garnered significant buzz for The Works (no surprise, given the continued enthusiasm for all things bacon-blessed). Menu highlights included What Would Bacon Do?, a starter of deep-fried bacon served with bacon mayonnaise, and a Gettin’ Piggy With It burger, featuring a beef patty topped with Canadian back bacon, cheddar, smoked bacon, bacon ketchup and onion strings. This summer, The Works continues to push Canadian burger-chain boundaries with the Get Stuff’d menu, offering burgers stuffed with pulled pork, cheese or chiles.

In June, The Works was named by Technomic as a 2014 Canadian Consumers’ Choice Awards winner, having garnered the highest marks from consumers for craveability (full-service restaurant category) among Technomic’s sample of leading Canadian restaurant chains. And individual stores’ support of local food banks and participation in community initiatives such as a sleep-out to raise money to fight homelessness help The Works generate goodwill and give guests further reason to continue to choose the chain.

Panera Bread: St. Louis-based Panera, which has more than 1,700 stores under the Panera Bread and St. Louis Bread Co. brands in the U.S., ended 2013 with 12 units in Canada. Comparatively small though the chain’s Canadian presence is, Panera did add three units in Canada last year, and Canadian sales rose an impressive 84.8% to $17 million. Units are concentrated in and around Toronto, where Canada’s rising fast-casual segment has a strong foothold.

Panera made the bold move in June of announcing that it would remove artificial colors, flavors and preservatives from its menu items by the end of 2016. The decision, according to management, was made with Millennials and their food-sourcing concerns in mind. Consumers’ heightened interest in what goes into their food means that concepts that pay heed to evolving (and more-stringent) customer demands stand to build brand loyalty, and Panera’s initiative reflects a commitment to staying at the leading edge of consumer health trends.

Canada’s fastest-growing leading restaurant chains span menu and service categories, pointing to growth opportunities throughout the industry for chains that make menu innovation and locally focused promotional and charitable initiatives central to their expansion efforts.

 

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Patrick Noone

With more than 15 years of experience in the research/consulting industry, Patrick Noone, Executive Vice President, Business Development, is integrally involved in the sales, development and marketing of Technomic's online resources, reports and custom studies—tools that provide clients with actionable industry data that supports their strategic and tactical business planning processes. He also manages Technomic's Business Development and Client Service teams.

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