‘Grocerants’ on the rise
Retailers aim to get customers to linger longer with in-store dining
VANCOUVER — Cooks at T&T Supermarket’s first seafood bar in Vancouver stand ready to prepare spot prawns, clams and lobsters freshly ordered by grocery shoppers, as the Asianfocused chains ups the ante for Canadian grocers increasingly looking to the “grocerant” trend to get shoppers to linger longer and spend more.
At a time of intense competition in the grocery business, chains increasingly blur the line between supermarkets and restaurants, adding takeout meals to their shelves, hot food counters where chefs make dishes to order and even full-service restaurants.
Diners at the new T&T destination receive a pair of gloves to eat — no cutlery — and sit in the seafood department, surrounded by creatures in live tanks and buckets containing orders zipping overhead.
“It’s a restaurant-quality experience at supermarket prices,” said Tina Lee, CEO of T&T, which is owned by Loblaw Companies Ltd.
Known to industry insiders as “grocerants,” such combination spaces serve a time-strapped population that values convenience at a time when grocers are feeling growing pressure from online competitors.
Loblaw is joining many rivals in the race to woo customers with innovative in-person experiences. Ontario grocer Farm Boy’s stores feature a kitchen that prepares fresh food, including sushi, and eating areas with free Wi-Fi. Rival grocer Longo’s runs three bars that serve pizza, burgers and other food. Whole Foods Market locations offer areas to enjoy meals from its prepared foods department.
Grocerants generated 2.35 billion visits in the U.S. over the past year ending June 2018, according to data from market research firm NPD Group — down 2 per cent from the same period a year ago, due in part to an uptick in food service delivery options.
“If you serve convenience to consumers, you can increase margins,” said Sylvain Charlebois, a Dalhousie University professor whose research focuses on the food industry. He identified grocerants as a major trend for this year in his annual food price report.
Canadian grocers are competing in a difficult landscape. Retailers Costco and Walmart have stolen billions of dollars worth of market share from traditional grocers over the past decade, and tech titan Amazon’s recent acquisition of Whole Foods has prompted a race to implement e-commerce options among companies that had been previously slow to offer delivery services.
They also face pressure from restaurants, where consumers looking for quick dining solutions over complicated homecooked meals spend their money.
All 11 locations of T&T, founded in 1993 and acquired by Loblaw in 2009, now offer some level of ready-made food — a concept CEO Lee scaled up significantly when she opened the 70,000square-foot Richmond location last week.
In addition to the seafood bar, the market also boasts an Asian Street Food stall. Lee plans to continue to add in-store dining to the next three stores the chain will open over the coming 12 months.
Some industry observers are quick to point the finger at millennials — the generation that made headlines for allegedly weakening cereal sales because they found the prep work too difficult — for driving the trend.
However, millennials aren’t the only demographic behind the trend. Frugal customers may like that grocerant meals tend to be cheaper.
Longo’s, which operates more than two dozen markets in Ontario, opened Corks Beer and Wine Bar in 2010. The company wants to expand the bar and restaurant concept further and is experimenting with smaller-scale versions of the bar, said Mike Longo, vice-president of fresh merchandizing for the company.
“The grocery store mentality is going to continue to evolve.”