The long view: How COVID-19 is reshaping the Canadian foodservice industry

By Sara Burnside Menuck

Amid sweeping new measures aimed at containing the COVID-19 outbreak in Canada, the foodservice industry is seeing unprecedented impacts. From Canadians being recommended to self-isolate, avoiding public spaces and gatherings of more than 50, and restaurants and bars being ordered to close dining rooms, offering delivery, takeout and drive-thru only, it’s a critical time for foodservice operators to show their flexibility — and their compassion.

Obviously, restaurant and bar owners and staff are occupied with mitigating immediate damages to their business and developing strategies for continuing their operations as their regular customer base goes into self-isolation. Ramping up food-safety and sanitation practices, reduced staff, sick leave, supply-chain disruptions — these are all incredible, and pressing, concerns.

But, says Jo-Ann McArthur, founding partner and president of Nourish Food Marketing, the coronavirus outbreak is set to reshape Canada’s foodservice industry beyond the current crisis, affecting consumer habits and behaviours for months and even years into the future. 

Short-term trends with long-term impact

Certainly, there are short-term effects both large and small: “We’re seeing Chinese restaurants and Italian restaurants decline more than their fair share, for sure,” McArthur comments, a reflection on two of the hardest-hit countries in terms of disease outbreak. But she also says that, longer-term, she expects to see an increasing shift in share of stomach back to grocery. “We’ve seen the trajectory move to foodservice, but I do think with what’s going on right now … People are going to rediscover cooking over the next couple of weeks.”

Another shorter-term trend McArthur is noticing is a rise in single-use plastics (SUP). Nourish Marketing previously noted that use of SUPs were on the decline as consumers have become more concerned about their impact on the environment. But, “as people rightly prioritize personal safety over planet safety,” that trend has been somewhat reversed, and McArthur sees it continuing past the next few weeks. Operators will have to figure out protocols for returning to reusable containers and cups as consumers’ fears ease and begin to want those options again. “I do think the plastics issue will come back after we get over this initial health scare.”

A third trend rising out of the immediate health situation is the accelerated adoption of cashless payments, both on the business and consumer side. Some chains are choosing to go cashless to protect their workers’ safety. It’s a trend that was already being rapidly adopted by younger generations, but McArthur thinks that, “short-term, that may also give a bit to older demographics.” Food-delivery apps, for example, have lagged with older generations, but now, with older people being most at risk with coronavirus, “we’ll see a bit of a bump in use of technology going forward.” 

Quarantine, and beyond

Another trend that was already growing, which McArthur says will likely be accelerated due to coronavirus, is the idea of going local, particularly as Canada continues to harden its borders. “Products from China, people have been looking at them for awhile,” she says, “because we don’t trust their food system. And food’s all about trust and transparency.” She predicts an even greater appreciation for local produce and foods.

But the biggest long-term impact McArthur predicts as a result of the coronavirus outbreak has to do with labour. “It’s not just about how you treat and where you source your food inputs, but also more attention is going to be on how people are treating their workers.” The precariousness of work in the foodservice industry is an accepted, if not ideal, fact of life. But as the industry grapples with issues such as quarantine and sick leave, there may be seeds of change. Legacy brands such as McDonald’s, Panera and Taco Bell in the U.S. are already implementing emergency two-week paid sick leave for employees impacted by COVID-19. Operators may feel increased pressure to change their policies around sick leave, “especially during times of crisis,” both in foodservice and as the gig economy as a whole.

This is an issue that had already been brewing for some time: there has been a push toward a more unionized model for food-delivery app workers, for example. McArthur notes that “there’s going to be all sorts of financial fallout even after we get through this initial health problem, so I do think that people are going to see that their neighbours are suffering, their communities are suffering, you’re going to see closures…” She recalls how, during the last recession, there was a huge community effort to create a resurgence of local businesses, farmers’ markets, and the like, “because people wanted to support their neighbours.” 

McArthur knows something about that kind of community support: During the SARS crisis in 2003, she was a divisional president at Molson Breweries, and was part of the team that led the “SARSStock” concert to help Canada’s hospitality industry get back on its feet. The benefit rock concert, organized in the month before it took place on July 30, 2003, was the largest ticketed outdoor event in Canadian history. McArthur predicts that Canadians will once again rally together in the kind of community support she saw almost two decades ago to revive the industry and combat short-term damages.

Three takeaways

  • Transparency
    “Be transparent. That’s how you build trust. So transparent in terms of your protocols, when you open again, in terms of cleaning, food preparation, how you treat your workers. Transparency, absolutely.”
  • Be nimble.
    “If you didn’t have online ordering, if you didn’t have delivery, you need to be able to shift between those. I think that’s critical.”
  • Community support.
    “I think that’s going to be really important going forward. … The majority of the population, we haven’t been through an event like this, where we all had to work together in concert. So I do think that that collective working together is going to change, and we are going to start looking out for each other a little bit differently, and there’s going to be more of a rise in community-supported businesses.”

Jo-Ann McArthur has spent a career building brands with consumers and retailers at Molson, Procter and Gamble, Unilever and Cadillac Fairview. As a founding partner and president of Nourish Food Marketing, Jo-Ann now builds powerful brands for food and beverage products in Canada, the U.S., and Europe, creating marketing strategies that help move products off the shelves, into the consumer’s shopping basket, onto their plates and into their hearts.

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