Location, location: Why Edmonton is preferred by US chains debuting in Canada

Alberta’s capital is known for many things – a giant shopping mall, a beautiful river valley and a fairly successful NHL franchise.

You can add to this list Edmonton’s appeal as a testing ground for American chain stores and restaurants looking to expand into the Canadian market.

Dickey’s Barbecue Pit, a popular Texas-based restaurant chain that opened its first Canadian restaurant in Edmonton on Thursday, is one of several major American chains considering expansion in the Alberta city.

In December, American convenience store chain 7-Eleven opened a licensed store in north Edmonton that includes an on-site liquor dining area.

California Pizza Kitchen, meanwhile, has announced that it will open its first Canadian restaurant in south Edmonton this year.

Industry experts say the demographics of the city’s population, eating habits, affordability and even the presence of a giant shopping mall are factors that attract companies keen to test the taste buds of Canadians.

“Edmonton is a really good place to start because you limit your risk and you get a good test of the market,” Ziad Kaddoura, an Edmonton-based franchise consultant, told CBC’s Edmonton AM.

He said the city is a great place to determine if companies are up to the challenge of bringing a franchise to Canada with the least amount of damage should their business fail.

“And it’s not as saturated as other markets,” he said. “So I think he ticks all the right boxes.”

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Dickey’s decided to come to Edmonton because of the similarities between Alberta and Texas, especially when it comes 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 Edmontonians tend to consume more white protein, chicken and turkey. “And that certainly suits us,” he said.

Small affordable market with mall

Kaddoura said the province has the closest cultural population makeup to the United States. Quebec, for example, would respond to something with a more French twist, he added.

Toronto and Vancouver are not suitable test markets as they are too large for companies to determine what is working and what is not.

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 rent; a similarly sized space in a Toronto suburb would cost between $20,000 and $25,000.

He said Edmontonians are also food savvy.

“They’re willing to try different things,” he said. A few decades ago, this brought restaurant chains like Red Robin and Outback Steakhouse to the city.

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 retail analyst Craig Patterson at the University of Alberta.

“It’s a very unique center. You don’t get in Calgary what you’ll get in Edmonton just because Edmonton has the West Edmonton Mall. So it’s quite interesting to see how that works,” he said. he declares.

The mall is home to the only locations in Canada of Sarah Jessica Parker’s SJP shoe store and Bubba Gump Shrimp Co. restaurant.

Population size is a problem

While a single restaurant could be successful in Edmonton, Kaddoura said Edmonton’s small population could be a deterrent for some brands.

Companies whose business model relies on high volume of products in multiple locations to serve a larger population may not work here.

“There is not enough to serve,” 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.