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sector-spotlight-deli-canada

Sector Spotlight: Delicatessens

Running your own deli can be a fantastic business opportunity, provided you adapt to the highly competitive and dynamic food retail industry.

With food trends coming and going at a record pace, it might feel difficult to know for sure what direction to take your deli business in; whether that be the traditional route of cold meats, bagels, and home-style salads, or the more current yet everchanging path of charcoal lattes and rainbow bagels. 

Here is your Sector Spotlight to help you along the way to running a successful delicatessen in Canada:

Facts & Figures

  • According to Chron, the deli business model is based on making and selling cold snacks, sandwiches and salads.
  • Unlike a restaurant, a deli is somewhat informal, serving more frugal meals in an ambiance that's noisier and more animated
  • With delis, a large proportion of the meals are take-out, and cheaper than the sit-down meals served on the premises
  • Technomic Inc.'s 2016 Canadian Sandwich Consumer Trend Report claims that more than half of consumers eat a deli sandwich at least once a month 

Industry Trends

No doubt about it; the fast-casual restaurant is a segment that's growing rapidly, and this is particularly worrying because fast-food chains are selling deli-style sandwiches.

Robert Carter of the NPD Group claims delis that want to do well in the current climate need to shift their focus from the lunch consumer to the breakfast consumer.

He claims, according to Food Service and Hospitality, that the lunch daypart is dwindling, while the breakfast daypart is flourishing.

Hibberd, on the other hand, claims there's a pattern to food trends in Toronto.

In his opinion, this pattern is similar to New York trends, but with a two-year lag. Considering delis are springing up like mushrooms in NYC now, it's likely that the same will happen for Toronto in a couple of years.

Owning a Deli Business

Acquisition

First thing’s first – figure out the type of business that fits your budget and circumstances. Do you want a start-up, or would you rather take over from a previous owner?

Canada Business Network suggests three options: starting a business from scratch, buying a franchise, or buying an established local business.

There's no shortage of delis offered for sale in Canada, for instance, you can find delis for sale from $75,000 (CAD) to $1,000,000 (CAD).

Theme and Product Line

A theme will always add ease to defining your menu and focusing your marketing efforts on people who will find your menu appealing.

There are a many, well-established deli themes out there: Indian, German, Kosher, French or Italian.

Also bearing in mind that 70% of processed meats are made with pork, according to the Agriculture and Agri-Food Department, so local supply chains are geared toward pork consumption.

Many delis can begin initially with a certain theme in mind but branch out and diversify their menu over time. The Bulk Cheese Warehouse in Saskatoon, who offer gourmet meals and snacks, is one such example of a deli with an attractive USP.

Original ideas, such as selling local artisan food, are always welcome. But new themes may come with a limited product variety and an even more limited client base.

Location and Demographics

Storefronts should be well-placed to serve as many customers as you're capable of serving and your branding well placed in your neighborhood.

So, what are the locals eating, drinking or even talking about? This kind of market research is invaluable prior to your grand re-opening.

The traffic and the spending power of passers-by should also match your capacity and growth prospects.

Consider running a survey in the area to make sure you understand the specifics of your prospective client base. Chron, suggests focusing on things such as median age, education, workplace, and income. Consider also, the ethnic make-up of your local community to develop the overall average demographic of your customers.



Bruce Hakutizwi

About the author

USA and International BusinessesForSale.com Manager for BusinessesForSale.com, a global online marketplace for buying and selling small medium size businesses. The website has over 60,000 business listings and attracts over 1.5 million buyers to the site every month.

@BizForSaleUS

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