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A look at Canada's largest restaurant chains

The largest 200 Canadian restaurant chains grew sales by 1 percent to $23.9 billion Canadian dollars last year — or $23.4 billion in U.S. dollars under current exchange rates — with a 1.3 percent increase in units, according to a report from research firm Technomic Inc. released Friday.

Unlike the biggest 200 chains in the United States — which saw a sales decline of 0.6 percent to $209.8 billion and unit count growth of 0.6 percent — the leading Canadian restaurants grew their sales by focusing on key factors other than price, Technomic said.

“By focusing beyond pricing to key factors such as food quality and freshness, the leading chains created a new value paradigm that may include premium, organic and local ingredients, as well as better-for-you foods,” said Darren Tristano, Chicago-based Technomic’s executive vice president.

The Canadian economy fared better than the United States during the recession last year, with its banking system reportedly remaining healthy and no significant downturn in its housing market. Reports also indicate that the U.S. neighbor is emerging more quickly from the economic downturn, with consumer spending recovering in late 2009 and employment rates climbing.

The Tim Hortons bakery-café chain continued to lead the Canadian restaurant industry in 2009, with an estimated C$4.9 billion in sales among its 3,014 units there.

Tim Hortons was also the second-fastest growing chain in the U.S., based on sales growth among those with sales higher than $200 million, according to Technomic. The research firm estimated the bakery-café chain’s sales in America reaching $446 million, a 23 percent increase, with the number of U.S. locations growing by 8 percent. Tim Hortons had an estimated 563 units in the U.S. at the end of 2009.

Following Tim Hortons in Canadian sales were U.S.-based McDonald’s and Subway. McDonald’s 1,420 units in Canada had an estimated C$2.7 billion in sales last year, and sales at the 2,477 Subway stores there reached an estimated C$1.1 billion.

Among the fastest growing chains in Canada were Cora’s Breakfast & Lunch, with sales up 23.9 percent among its 116 locations; Jack Astor’s Bar and Grill, up 8.7 percent among its 30 stores; and Starbucks, with sales up 7.9 percent among the 1,051 units there, Technomic estimated.

As in the United States, limited-service restaurant chains fared better in Canada last year, the report said.

Limited-service restaurants registered sales growth of 1.8 percent for a total of C$17.1 billion, while growing units by 1.3 percent.

Full-service restaurants in Canada, however, saw sales decline 1 percent to C$6.8 billion, despite a marginal increase in store count of 0.7 percent, according to the report.

Contact Lisa Jennings at [email protected].

TAGS: Finance News
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