Alberta’s capital is known for many things – a huge mall, a gorgeous river valley and a very successful NHL franchise.
You can add Edmonton’s allure to that list as a testing ground for American stores and restaurants looking to expand into the Canadian market.
Dickey’s BBQ Pit, a popular Texas-based restaurant chain that opened its first Canadian location in Edmonton Thursday, is one of the few major American chains looking to expand into the Alberta city.
In December, US supermarket chain 7-Eleven opened a licensed location in North Edmonton that includes a dining area for liquor consumption on the premises.
Meanwhile, California Pizza Kitchen said it will open its first Canadian location in South Edmonton sometime this year.
Industry experts say the city’s demographics, eating habits, affordability and even the presence of a giant mall are factors in attracting companies keen to test the taste of Canadians.
“Edmonton is a very good place to start because you are limiting your risk and getting a good market test,” Ziad Kaddoura, a franchise consultant in Edmonton, told CBC’s Edmonton AM.
He said the city is a great place to see if companies are up to the challenge of offering a franchise in Canada with minimal damage should their venture fail.
“It’s not as saturated as other markets,” he said. “So I think this is ticking all the right boxes.”
9:00New chains love Edmonton
Dickey decided to come to Edmonton because of the similarities between Alberta and Texas, especially when it came to oil and beef.
“Those two things are exactly how this brand started 81 years ago in my country,” said Jim Perkins, the company’s vice president of international sales and support.
Market research has shown that people in Edmonton are moving towards higher consumption of white protein, chicken and turkey. “And that’s definitely fine with us,” he said.
Smaller and affordable market with mall
Kaddoura added that the province with the closest cultural demographics to American Quebec, for example, would respond to something with more French flair.
Toronto and Vancouver are not suitable test markets in that they are too big for companies to figure out what works and what doesn’t.
Compared to other cities, Edmonton has an affordable real estate market, Kaddoura said.
He said a 3,500-square-foot space in a neighborhood like Windermere could cost $12,000 a month in fees, leases and rentals. A similar space in a Toronto suburb costs anywhere from $20,000 to $25,000.
He said[إدمونتونينس]Also smart food.
“They are open to trying different things,” he said. Two decades ago, that brought restaurant chains like Red Robin and Outback Steakhouse to town.
The West Edmonton Mall, which opened in 1981 and was once the largest mall in North America, also plays a role in attracting businesses to Edmonton, said Craig Patterson, a retail analyst at the University of Alberta.
“It’s a very unique center,” he said. “You don’t get some of the things in Calgary that you’d get in Edmonton just because Edmonton has a West Edmonton mall. So it’s interesting how that works.”
The mall is home to the only Canadian locations for Sarah Jesica Parkers SJP shoe store and Bubba Gump Shrimp Co.
Population size is a problem
Although only one restaurant could achieve success in Edmonton, Kaddoura said Edmonton’s small population could be a deterrent for some brands.
Companies with a business model that relies on a large volume of products in several locations to serve a larger population may not operate here.
“There is not enough for the service,” Kaddoura said.
But he said other brands will be watching the success of new openings to decide if they want to follow suit. “We’ll see what happens in the future,” he said.