By Robert Phelps
The hospitality sector in Canada is growing. According to Statistics Canada, foodservice sales have jumped from $5.1 billion to $6.3 billion since the start of this year. With such growth comes innovation, and much like in the housing and transport markets, the sharing economy has taken root in the hospitality industry. Homeowners started monetizing spare rooms in their houses on Airbnb and Uber drivers started getting fares from point A to point B in their own vehicles, and now restaurateurs have started making their kitchens into communal infrastructure with constant, profitable uptime. It’s no wonder the sharing economy is growing so quickly. According to Statistics Canada, between 2015 and 2016, 9.5 per cent of Canada’s population — 2.7 million people — participated in the sharing economy, using private accommodation or peer-to-peer ride services. Restaurateurs will surely add to that number.
Collective Effort
We’re witnessing the emergence of sharing economy innovations within the hospitality sector across Canada. The rise of food trucks is a great example of this. There are currently over 2,200 mobile food service operators in Canada, and the City of Vancouver has even taken steps to encourage their operation. And while that’s helped foodservice entrepreneurs take to the streets, they’re still mandated by Vancouver Coastal Health to prepare food in a commissary kitchen, and this is fuelling the sharing economy as entrepreneurs seek an affordable space to prepare food. Many catering companies lease their space when it’s not in use to food truck owners, which is a win-win for food truck operators and catering owners alike.
The basic concept extends to shared kitchens. Some hospitality entrepreneurs are coming together to form collective companies, operating independently but using the same space. Belgard Kitchen is a great example where Belgard, Postmark Brewing and Vancouver Urban Winery all operate out of the one area and feature each other’s products on their menus. They also enable fledgling entrepreneurs to avoid the steep capital costs of renting or buying space and appliances for a new kitchen. Services such as Commissary Connect provide members with access to a shared kitchen 24 hours a day, along with a dedicated workstation, prep table and food storage.
No-Service Restaurants
Canadian entrepreneurs are building “ghost kitchens” to capitalize on the popularity of food delivery. A ghost kitchen is different from a traditional food takeout service because there is no direct interaction between the customer and restaurateur — food is ordered via a third-party food delivery company and dropped off by the same. Third-party apps like UberEats, Foodora and DoorDash have already provided the digital infrastructure and have thoroughly proven the third-party delivery concept. Already, businesses like DoorDash are seeing huge growth locally, with a tenfold increase in deliveries within ten months.
Waste Not
We’re also pleased to see the sharing economy applied to food waste, with an increase in organizations ensuring leftover food is used or given away, rather than thrown out. Currently, around $31 billion worth of food is thrown out in Canada each year. The Food Stash Foundation is one nonprofit that is rescuing food that would have been destined for landfill and delivering edible food to charities and food-insecure households. JJ Bean, Rosemary Rock Salt, and Cupcakes support Food Stash’s program, which collects 12,000 pounds of food each month and redistributes it to people who need it.
The Takeout Takeaway
Canada’s food industry is rich, diverse and growing exponentially. The sharing economy is not only contributing to this growth, but it’s changing what we eat and the lines between dining out, cooking at home and shopping in stores. Some restaurateurs are chafing at the rising of sharing platforms, and it’s true that operators who won’t or can’t effectively adapt may find their profit margins squeezed even tighter. Delivery apps, collective kitchens, ghost restaurants and other innovations are nevertheless positioned to take on important roles in the hospitality industry, supercharging some business while leaving others behind, so operators best start sharing.
About the Author
Robert Phelps is the President of Silver Chef Canada, a leading dedicated hospitality financier that has supported 30,000 hospitality businesses globally, including 2,300 here in Canada.
