data monitor report on food services

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Foodservice in Canada

Industry Profile

Reference Code: 0070-2333Publication date: September 2008

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Canada - Foodservice

© Datamonitor (Published September 2008)

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EXECUTIVE SUMMARY



EXECUTIVE SUMMARY

Market Value

The Canadian foodservice industry grew by 3.4% in 2007 to reach a value of $17.5 billion.

Market Value Forecast

In 2012, the Canadian foodservice industry is forecast to have a value of $20.4 billion, an increase of 16.7% since 2007.

Market Volume

The Canadian foodservice industry grew by 2.1% in 2007 to reach a volume of 6.9 billion transactions.

Market Volume Forecast

In 2012, the Canadian foodservice industry is forecast to have a volume of 7.6 billion transactions, an increase of 10.2% since 2007.

Market Segmentation I

Cafés & restaurants is the most lucrative segment, generating 43.3% of the Canadian foodservice industry's value.

Market Segmentation II

Canada accounts for 6.6% of America’s regional value.

CONTENTS



TABLE OF CONTENTS

EXECUTIVE SUMMARY 3

CHAPTER 1 Market Overview 7

1.1 Market Definition 7

1.2 Research Highlights 8

1.3 Market Analysis 9

CHAPTER 2 Market Value 10

CHAPTER 3 Market Volume 11

CHAPTER 4 Market Segmentation I 12

CHAPTER 5 Market Segmentation II 13

CHAPTER 6 Competitive Landscape 14

CHAPTER 7 Leading Companies 17

7.1 Darden Restaurants, Inc. 17

7.2 McDonald's Corporation 20

7.3 Wendy's International, Inc. 23

7.4 Cara Operations Limited 25

CHAPTER 8 Market Forecasts 26

8.1 Market Value Forecast 26

8.2 Market Volume Forecast 27

CHAPTER 9 Demographics 28

CONTENTS



CHAPTER 10 Appendix 30

10.1 Methodology 30

10.2 Industry Associations 31

10.3 Related Datamonitor Research 31

CONTENTS



LIST OF TABLES

Table 1: Canada Foodservice Industry Value: $ billion, 2003-2007 ................................10

Table 2: Canada Foodservice Industry Volume: Transactions billion, 2003-2007...........11

Table 3: Canada Foodservice Industry Segmentation I: % Share, by Value, 2007 .........12

Table 4: Canada Foodservice Industry Segmentation II: % Share, by Value, 2007 ........13

Table 5: Key Facts: Darden Restaurants, Inc. ................................................................17

Table 6: Key Financials: Darden Restaurants, Inc. .........................................................19

Table 7: Key Facts: McDonald's Corporation..................................................................20

Table 8: Key Financials: McDonald's Corporation ..........................................................22

Table 9: Key Facts: Wendy's International, Inc. ..............................................................23

Table 10: Key Financials: Wendy's International, Inc........................................................24

Table 11: Key Facts: Cara Operations Limited .................................................................25

Table 12: Canada Foodservice Industry Value Forecast: $ billion, 2007-2012 .................26

Table 13: Canada Foodservice Industry Volume Forecast: Transactions billion, 2007-2012........................................................................................................................27

Table 14: Canada Size of Population (million) , 2003-2007 ..............................................28

Table 15: Canada GDP (Constant 2000 Prices, $ billion), 2003-2007 ..............................28

Table 16: Canada Inflation, 2003-2007.............................................................................28

Table 17: Canada Exchange Rate, 2003..........................................................................29

MARKET OVERVIEW



CHAPTER 1 MARKET OVERVIEW

1.1 Market Definition

Foodservice is defined as the sale of food and drinks for immediate consumption either on the premises from which they were bought, or in designated eating areas shared with other foodservice operators, or in the case of takeaways transactions, freshly prepared food for immediate consumption. Datamonitor's definition excludes sales through vending machines and is restricted to sales in specific foodservice channels (please see channel definitions below).

All market values are given in Operator Buying Prices, that is the amount spent by foodservice operators on the food and drink that they serve and not the amount the consumers spend on food and drinks (Operator Selling Prices - OSPs) in these channels. The difference is the mark up the foodservice operator adds in order to cover their other costs and generate a profit. This therefore values the market in terms of the amount of money for which food and drinks manufacturers are competing.

The market is broken down in to four segments: Cafes & Restaurants, Fastfood, Cost and Other. Cafes & Restaurants includes Cafes, Pubs & Bars, Full Service Restaurants, Hotels and Retail locations; Fastfood includes Quick Service Restaurants, Takeaways, Street Vendors and Leisure Locations (cinemas, theatres etc.); Other includes Nightclubs and sales On-board boats, planes, trains or coaches; the Cost segment is characterised by the fact that a subsidy is paid (either directly or indirectly) to one of the actors involved in the transaction, or where the final consumer pays for the food at its actual cost (as opposed to a price that adds some margin to its basic cost). The cost sector includes the following channels - workplace locations, education locations, hospitals and welfare & services locations.

Market volumes are classed as the total number of visits by individuals to foodservice locations that involve the consumption of either food, or drink, or both. As such, if several people visit one location at once and there is only one bill (e.g. a group dining in a restaurant), the number of transactions is counted as being one for each person in the group. Multiple purchases made during the same visit (e.g. a person buys several drinks bought over a period of time in a bar) are counted as one transaction. The purchase of drink with food in the same location in the same visit is also considered as one transaction, not two.

All currency conversions used in this profile were carried out using constant 2007 average annual exchange rates.

MARKET OVERVIEW



For the purpose of this profile, the Americas consists of Brazil, Canada, Mexico and the United States.

1.2 Research Highlights

The Canadian Foodservice industry generated total revenues of $17.5 billion in 2007, representing a compound annual growth rate (CAGR) of 3.2% for the period spanning 2003-2007.

Cafés & Restaurants sales proved the most lucrative for the Canadian Foodservice industry in 2007, generating total revenues of $7.6 billion, equivalent to 43.3% of the industry's overall value.

The performance of the industry is forecast to follow a similar pattern, with an anticipated CAGR of 3.1% for the five-year period 2007-2012, which is expected to drive the industry to a value of $20.4 billion by the end of 2012.

MARKET OVERVIEW



1.3 Market Analysis

Since 2003, the Canadian Foodservice industry has experienced high growth rates, and this trend looks set to continue, although it is expected to experience a slight deceleration.

The Canadian Foodservice industry generated total revenues of $17.5 billion in 2007, representing a compound annual growth rate (CAGR) of 3.2% for the period spanning 2003-2007. In comparison, the United States and Mexican industries grew with CAGRs of 3.7% and 4.2%, respectively, over the same period, to reach respective values of $195 billion and $31.7 billion in 2007.

Cafés & Restaurants sales proved the most lucrative for the Canadian Foodservice industry in 2007, generating total revenues of $7.6 billion, equivalent to 43.3% of the industry's overall value. In comparison, sales of Cost Foodservice generated revenues of $5.6 billion in 2007, equating to 32.3% of the industry's aggregate revenues.

The performance of the industry is forecast to follow a similar pattern, with an anticipated CAGR of 3.1% for the five-year period 2007-2012, which is expected to drive the industry to a value of $20.4 billion by the end of 2012. Comparatively, the United States and Mexican industries will grow with CAGRs of 3.3% and 3.7%, respectively, over the same period, to reach respective values of $228.8 billion and $38.1 billion in 2012.

MARKET VALUE



CHAPTER 2 MARKET VALUE

The Canadian foodservice industry grew by 3.4% in 2007 to reach a value of $17.5 billion.

The compound annual growth rate of the industry in the period 2003-2007 was 3.2%.

Table 1: Canada Foodservice Industry Value: $ billion, 2003-2007 Year $ billion C$ billion % Growth 2003 15.4 16.5 2004 15.9 17.0 3.00%2005 16.4 17.6 3.20%2006 16.9 18.2 3.30%2007 17.5 18.8 3.40% CAGR, 2003-2007: 3.2% Source: Datamonitor D A T A M O N I T O R

Figure 1: Canada Foodservice Industry Value: $ billion, 2003-2007

Source: Datamonitor D A T A M O N I T O R

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MARKET VOLUME



CHAPTER 3 MARKET VOLUME

The Canadian foodservice industry grew by 2.1% in 2007 to reach a volume of 6.9 billion transactions.

The compound annual growth rate of the industry volume in the period 2003-2007 was 2%.

Table 2: Canada Foodservice Industry Volume: Transactions billion, 2003-2007

Year Transactions

billion % Growth 2003 6.4 2004 6.5 1.80%2005 6.6 2.00%2006 6.8 2.00%2007 6.9 2.10% CAGR, 2003-2007: 2.0% Source: Datamonitor D A T A M O N I T O R

Figure 2: Canada Foodservice Industry Volume: Transactions billion, 2003-2007


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MARKET SEGMENTATION I



CHAPTER 4 MARKET SEGMENTATION I

Cafés & restaurants is the most lucrative segment, generating 43.3% of the Canadian foodservice industry's value.

The cost segment accounts for a further 32.3% of the industry's revenues.

Table 3: Canada Foodservice Industry Segmentation I: % Share, by Value, 2007

Category % Share Cafés & Restaurants 43.30%Cost 32.30%Fast-food 23.30%Other 1.00% Total 100.0% Source: Datamonitor D A T A M O N I T O R

Figure 3: Canada Foodservice Industry Segmentation I: % Share, by Value, 2007

Cafés & Restaurants

43.3%

Cost32.3%

Fast-food23.3%

Other1%


MARKET SEGMENTATION II



CHAPTER 5 MARKET SEGMENTATION II

Canada accounts for 6.6% of America’s regional value.

The United States, the most lucrative region, generates 73.1% of the industry's revenues.

Table 4: Canada Foodservice Industry Segmentation II: % Share, by Value, 2007

Geography % Share United States 73.10%Mexico 11.90%Brazil 8.40%Canada 6.60% Total 100.0% Source: Datamonitor D A T A M O N I T O R

Figure 4: Canada Foodservice Industry Segmentation II: % Share, by Value, 2007


United States73.1%

Mexico11.9%

Brazil8.4%

Canada6.6%

COMPETITIVE LANDSCAPE



CHAPTER 6 COMPETITIVE LANDSCAPE

The profit foodservice segment is the dominant segment within the sector, which will be reflected in this analysis. The profit foodservice sector is characterized by the choice it offers to consumers. The sheer number of players and the ease of switching between them intensifies competition between players; however the whim of one individual does not have a great impact on revenues.

The greatest threat to cafes and restaurants is the likelihood of buyers essentially achieving 'backwards integration' by purchasing the raw materials cheaply and cooking the meal themselves in their own kitchen. Consequently, players have a constant battle on their hands to offer a differentiated experience and add entertainment value to the meal besides the food itself; through branding and the environment that they create.

Upstream in the sector, the size and independence of suppliers exerts margin pressure on players as they feel no urgency to keep raw material prices low. New entrants are attracted by healthy market growth and face few barriers to entry.

The profit foodservice sector includes restaurants, cafes, and fast-food outlets, with individual consumers as the only buyers. The main source of buyer power is the lack of switching costs: within a given price range, a consumer's choice of foodservice provider is purely a matter of personal taste, and can vary from one day to the next.

There is also likely to be relatively high price elasticity of demand, because foodservice is not strictly essential to consumers; in fact, they can 'backwards integrate' by foregoing the restaurant and cooking their own food. High transaction volumes mean that the impact of any one consumer on revenues is usually small - the exception here can be premium-price, non-chain restaurants, whose business model relies on low-volume, high-margin sales.

Furthermore, investment in brand building, especially in the low- and medium-price segments, has driven customer loyalty, while the social functions and sheer convenience of foodservice makes it more important to the consumer than a simple source of food. Overall, buyer power in the profit foodservice sector is moderate.

Foodservice is a labor intensive industry, and wages form a significant proportion of operating costs: around 25-30%. The existence of a statutory minimum wage increases the need for players to keep other costs as lean as possible, which in turn increases the importance of suppliers. Foodservice companies are generally low-margin businesses, and need to source good quality food at low prices.

Risks associated with supply chain disruption, or the inability of a competing supplier to offer food of adequate quality, could increase switching costs.




Many of the foodservice suppliers are large companies, and the high number of businesses they serve means that they themselves are under less pressure to keep their prices down.

While some players in the higher-priced segments, usually operating only a few restaurants at most, often 'backwards integrate' and purchase their food supplies direct by visiting farmers' markets, more moderately-priced chain restaurants would find such a practice unfeasible in terms of both time and cost. Overall, supplier power is assessed as strong.

Entry to the profit foodservice sector generally requires little capital, and independent foodservice outlets can be successful as sole proprietor operations. More ambitious companies that wish to expand beyond a single restaurant can do so through franchising. This reduces the costs of the parent company, and is a key expansion route for many large foodservice firms.

Established players have usually established relationships with trusted suppliers and their bargaining power benefits from economies of scale; new entrants may have difficulty emulating this to gain quality produce cost-effectively. Stringent government regulations regarding the handling and preparation of foodstuffs could be a barrier to entry for a sole proprietor who was new to the sector; however players with the capital to obtain trained staff and quality kitchen equipment would not find this burdensome.

Additionally, although there are strong brands present in this market, their sheer number means that buyers rarely remain loyal to only one player. Revenue growth in the profit foodservice sector has been healthy in recent years, increasing its attractiveness to new players, and making the likelihood of new entrants strong.

Profit foodservice customers are usually in a position to prepare their own food, which constitutes the main threat of substitutes. The main switching cost is the opportunity cost of the time spent in the kitchen, as home-cooked food itself is usually cheaper than a meal in a restaurant. Other substitutes include alternative leisure pursuits such as movie and theatre going, in the sense that consumers could decide on those pursuits as opposed to meeting friends for a meal in a restaurant.

Furthermore, a cultural increase in snacking and 'eating on the go' has tended to reduce the number of formal meal occasions in the consumer's week and driven business to retailers instead. The usual strategy adopted to deal with the threat of substitutes in profit foodservice is to sell an experience as well as food and drink.

For chains, this may be achieved through investment in brand building; for high-end independent full service restaurants, it may involve the development of a much more individualized identity, perhaps focusing on the influence of a particular style of cooking. The impact of substitutes on profit foodservice is assessed as moderate.




In the profit foodservice sector, there are numerous small competitors; thus, within any segment, there are many companies with similar structures offering similar products, and consumers incur no costs in changing their foodservice providers, which intensifies rivalry between players. Rivalry is somewhat mitigated, however, by the relative ease of expansion and also the absence of high exit costs.

Even complete exit from the industry is not unduly expensive: physical assets such as restaurants do not represent significant sunk costs even if owned rather than rented, as they can be sold for a good price, and most of the staff laid off will not be eligible for costly redundancy payments.

The healthy revenue performance of the sector in recent years eases rivalry, as it is more possible for a player to increase its own revenues without encroaching on those of its competitors. However, rivalry in the profit sector is assessed as strong overall.

LEADING COMPANIES



CHAPTER 7 LEADING COMPANIES

7.1 Darden Restaurants, Inc.

Table 5: Key Facts: Darden Restaurants, Inc. Address: 5900 Lake Ellenor Drive, Orlando, Florida 32809, USA Telephone: 1 407 245 4000 Fax: 1 407 245 5114 Website: www.darden.com Financial Year-End: May Ticker: DRI Stock Exchange: New York Source: Company Website D A T A M O N I T O R

Darden Restaurants (Darden) is one of the leading casual dining restaurant companies in the world. It is the parent company of GMRI, a Florida corporation. GMRI and other Darden subsidiaries own the operating assets of the restaurants.

The company's restaurants operate under following brands: Red Lobster, Olive Garden, Bahama Breeze, Smokey Bones Barbeque & Grill and Seasons 52. The company offers no franchising opportunities domestically, but does have a licensing agreement to operate over 32 Red Lobster restaurants in Japan.

The company serves over 350 million meals annually through its 1, 700 restaurants in the US and Canada. In the US, it operates 1,362 restaurants in 49 states, including 651 Red Lobster, 608 Olive Garden, 23 Bahama Breeze, 73 Smokey Bones Barbeque & Grill and seven Seasons 52 restaurants.

In Canada, the company operates 35 restaurants, including 29 Red Lobster and six Olive Garden restaurants. In Japan, the company has licensed 32 Red Lobster restaurants to an unaffiliated Japanese company.

Red Lobster is a casual dining, seafood-specialty restaurant operator in the US. It has 651 restaurants in US and 29 restaurants in Canada. Red Lobster's menu includes fish, shrimp, crab, lobster, scallops and other seafood. The menu also includes a variety of specialty seafood and non-seafood entrees, appetizers and desserts.

Olive Garden is a full-service Italian restaurant company, with 608 restaurants in the US and six in Canada. Its menu includes Italian food and wines, such as antipasti, soups, salad and garlic breadsticks, pastas, specialties with chicken, seafood and fresh vegetables, grilled meats and a variety of desserts. Olive Garden also uses coffee imported from Italy for its espresso and cappuccino.

LEADING COMPANIES



Bahama Breeze is Caribbean-themed restaurant that offers food and drinks found on islands. The menu features Caribbean-inspired seafood, chicken and steaks, as well as signature specialty drinks. Bahama Breeze maintains 11 different lunch and dinner menus, as well as a children's menu.

Smokey Bones is an internally developed concept, which features barbequed pork, beef and chicken, as well as other grilled favorites, all served in a mountain-lodge setting that features televised sports.

The company also operates Seasons 52 chain of restaurants, a fresh grill and wine bar with seasonally inspired menus offering fresh ingredients to create great tasting meals that are lower in calories than comparable restaurant meals. It offers an international wine list of more than 140 wines, with 70 available by the glass.

LEADING COMPANIES



Key Metrics

Table 6: Key Financials: Darden Restaurants, Inc. Metric 2003 2004 2005 2006 2007 Revenues 4,654.9 5,003.4 5,278.1 5,353.6 5,567.1Net Income 226.0 227.2 290.6 338.2 201.4Profit Margin 4.9% 4.5% 5.5% 6.3% 3.6%Total Assets 2,664.6 2,780.3 2,937.7 3,010.1 2,880.8Total Liabilities 1,534.6 1,605.1 1,664.7 1,780.4 1,786.3Employees 140,700 141,300 150,100 157,300 156,500 Source: Company Filings D A T A M O N I T O R

Figure 5: Revenues & Profitability: Darden Restaurants, Inc.

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LEADING COMPANIES



7.2 McDonald's Corporation

Table 7: Key Facts: McDonald's Corporation Address: McDonald's Plaza, Oak Brook, Illinois 60523, USA Telephone: 1 630 623 3000 Fax: 1 630 623 5004 Website: www.mcdonalds.com Financial Year-End: December Ticker: MCD Stock Exchange: New York Source: Company Website D A T A M O N I T O R

McDonald's Corporation (McDonald's) operates fast food restaurants all over the world. The company is the world's largest food service retailing chain, preparing and serving a range of foods. All McDonald's restaurants offer a standard menu, which comprise food items such as hamburgers, cheeseburgers, chicken sandwiches, French fries, salads, milk shakes, desserts and ice cream sundaes. Some McDonald's restaurants offer additional food items to suit local taste and preferences. The company also operates restaurants under the brand name 'Boston Market'.

The company's business is divided into four geographic segments: Europe, the US, APMEA (Asia, Pacific, Middle East and Africa), and other countries and corporate. Other countries and corporate includes Canada and Latin America, as well as Corporate activities and certain investments. In FY2007, the company operated 31,370 fast food restaurants in over 118 countries in the following geographic segments: the US; Europe; Asia Pacific, Middle East and Africa (APMEA); Latin America and Canada.

McDonald's restaurants offer a substantially uniform menu, although there may be geographic variations. McDonald's menu includes hamburgers and cheeseburgers, Big Mac, Quarter Pounder with Cheese, Filet-O-Fish, several chicken sandwiches, Chicken McNuggets, Chicken Selects, french fries, premium salads, shakes, McFlurry desserts, sundaes, soft serve cones, pies, cookies, soft drinks, coffee and other beverages. In addition, the restaurants sell a variety of other products during limited-time promotions.

McDonald's generates revenues through company operated restaurants and franchisee restaurants. Of total 31,370 McDonald's restaurants, over 6,900 are operated by the company and over 20,500 are operated by franchisees. The remaining, around 3,960 restaurants are operated by affiliates. The company's revenue comprises sales from company operated restaurants and fees as well as rent from franchisees and affiliates.

LEADING COMPANIES



Under the franchise arrangement, the franchisees invest in the equipment, signage, seating and decor, while the company owns or leases the land and building. Franchisees pay the company service fees and rent for premises. A Service fee is set as a percentage of sales, while rent and other terms of occupancy are stipulated in the franchise agreement, which is drawn for a period of 20 years.

The company and its franchisees as well as affiliates source purchase food, packaging, equipment and other goods from approved suppliers. The company maintains quality standards through assurance labs around the world. A quality assurance board, including the company's technical, safety and supply chain specialists, provide guidance on all aspects of food quality and safety.

LEADING COMPANIES



Key Metrics

Table 8: Key Financials: McDonald's Corporation Metric 2003 2004 2005 2006 2007 Revenues 17,140.5 18,594.0 19,117.3 20,895.2 22,786.6Net Income 1,471.4 2,278.5 2,602.2 3,544.2 2,395.1Profit Margin 8.6% 12.3% 13.6% 17.0% 10.5%Total Assets 25,838.0 27,837.5 29,988.8 28,974.5 29,391.7Total Liabilities 13,856.1 13,636.0 14,842.7 13,516.2 14,111.9Employees 418,000 438,000 447,000 465,000 390,000 Source: Company Filings D A T A M O N I T O R

Figure 6: Revenues & Profitability: McDonald's Corporation

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LEADING COMPANIES



7.3 Wendy's International, Inc.

Table 9: Key Facts: Wendy's International, Inc.

Address: 4288 West Dublin-Granville Road, Dublin, Ohio 43017 0256, USA

Telephone: 1 614 764 3100 Fax: 1 614 764 3330 Website: www.wendys.com Financial Year-End: December Ticker: WEN Stock Exchange: New York Source: Company Website D A T A M O N I T O R

Wendy's International is engaged in the operation, development, and franchising of restaurants. As of December 2007, the company operated 6,645 Wendy's restaurants in the US and 19 other countries and territories. Of these restaurants, 1,414 are company operated and 5,231 by the company's franchisees.

Each Wendy's restaurant offers a relatively standard menu featuring hamburgers and chicken sandwiches, which are prepared to order with the customer's choice of condiments. Wendy's menu also includes chicken nuggets, chili, baked and French fried potatoes, freshly prepared salads, soft drinks, milk, frosty dessert, floats and kids meals. In addition, the restaurants sell a variety of promotional products on a limited basis.

The company sells sandwich buns and kids' meal toys to its franchisees. The New Bakery (Bakery) Co., a wholly owned subsidiary, supplies buns to the Wendy's restaurants. As of December 2007, the Bakery supplied 637 restaurants operated by the company and 2,366 restaurants operated by franchisees. The Bakery operates two facilities in Zanesville, Ohio that produce hamburger buns for Wendy's restaurants. The hamburger buns are distributed to both company operated and franchisee restaurants using primarily the Bakery's fleet of trucks.

LEADING COMPANIES



Key Metrics

Table 10: Key Financials: Wendy's International, Inc. Metric 2003 2004 2005 2006 2007 Revenues 2,251.9 2,502.2 2,455.4 2,439.3 2,450.2Net Income 236.0 52.0 224.1 94.3 87.9Profit Margin 10.5% 2.1% 9.1% 3.9% 3.6%Total Assets 3,133.0 3,197.5 3,440.3 2,060.3 1,789.4Total Liabilities 1,374.4 1,481.9 1,381.7 1,048.7 985.3 Source: Company Filings D A T A M O N I T O R

Figure 7: Revenues & Profitability: Wendy's International, Inc.

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LEADING COMPANIES



7.4 Cara Operations Limited

Table 11: Key Facts: Cara Operations Limited Address: 6303 Airport Road, Mississauga, L4V 1R8 Ontario, CAN Telephone: 1 905 405 6500 Fax: 1 905 405 6777 Website: www.cara.com Financial Year-End: March Ticker: N/A Stock Exchange: N/A Source: Company Website D A T A M O N I T O R

Cara Operations is an integrated foodservice company. The company operates in Canada. The brand portfolio of the group comprises of Swiss Chalet, Kelsey's, Harvey's, Milestone's Grill & Bar and Montana's Cookhouse. The company also provides airline solutions.

The company's Swiss Chalet restaurant provides roasted chicken. The Harvey's restaurant provides burgers. The Montana's Cookhouse provides steak and chicken. The company's Airline Solutions operate ten air kitchens in Canada.

The group operates full service family restaurants, airport dining services, airline catering and integrated food distribution operations for institutional clients in the business and industry, education and remote resource camp segments.

Key Metrics

Cara Operations Ltd. generated revenues of $1,024.7 million in the financial year ended March 2007, a decrease of 15.3% compared to the previous year.

MARKET FORECASTS



CHAPTER 8 MARKET FORECASTS

8.1 Market Value Forecast

In 2012, the Canadian foodservice industry is forecast to have a value of $20.4 billion, an increase of 16.7% since 2007.

The compound annual growth rate of the industry in the period 2007-2012 is predicted to be 3.1%.

Table 12: Canada Foodservice Industry Value Forecast: $ billion, 2007-2012

Year $ billion C$ billion % Growth 2007 17.5 18.8 3.40%2008 18.1 19.4 3.30%2009 18.6 20.0 3.20%2010 19.2 20.7 3.20%2011 19.8 21.3 3.10%2012 20.4 21.9 2.90% CAGR, 2007-2012: 3.1% Source: Datamonitor D A T A M O N I T O R

Figure 8: Canada Foodservice Industry Value Forecast: $ billion, 2007-2012


16.016.517.017.518.018.519.019.520.020.521.0

2007 2008 2009 2010 2011 2012

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2.9%

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3.2%

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MARKET FORECASTS



8.2 Market Volume Forecast

In 2012, the Canadian foodservice industry is forecast to have a volume of 7.6 billion transactions, an increase of 10.2% since 2007.

The compound annual growth rate of the industry volume in the period 2007-2012 is predicted to be 2%.

Table 13: Canada Foodservice Industry Volume Forecast: Transactions billion, 2007-2012

Year Transactions

billion % Growth 2007 6.9 2.10%2008 7.0 2.00%2009 7.2 2.00%2010 7.3 2.00%2011 7.5 1.90%2012 7.6 1.90% CAGR, 2007-2012: 2.0% Source: Datamonitor D A T A M O N I T O R

Figure 9: Canada Foodservice Industry Volume Forecast: Transactions billion, 2007-2012


6.4

6.6

6.8

7.0

7.2

7.4

7.6

7.8

2007 2008 2009 2010 2011 2012

Tran

sact

ions

bill

ion

1.75%

1.80%

1.85%

1.90%

1.95%

2.00%

2.05%

2.10%

% G

rowth

Transactions billion % Growth

DEMOGRAPHICS



CHAPTER 9 DEMOGRAPHICS

Table 14: Canada Size of Population (million) , 2003-2007 Year Population (million) % Growth 2003 32.22004 32.5 0.90%2005 32.8 0.90%2006 33.1 0.90%2007 33.4 0.90% Source: Datamonitor D A T A M O N I T O R

Table 15: Canada GDP (Constant 2000 Prices, $ billion), 2003-2007

Year Constant 2000

Prices, $ billion % Growth 2003 764.42004 786.7 2.90%2005 822.6 4.60%2006 854.3 3.90%2007 888.2 4.00% Source: Datamonitor D A T A M O N I T O R

Table 16: Canada Inflation, 2003-2007 Year Inflation Rate (%) % Growth 2003 2.82004 1.9 -32.20%2005 2.2 15.20%2006 2.2 3.00%2007 2.0 -10.40% Source: Datamonitor D A T A M O N I T O R

DEMOGRAPHICS



Table 17: Canada Exchange Rate, 2003

Year Exchange Rate

($/C$) 2003 0.713792004 0.768342005 0.825272006 0.881362007 0.93075 Source: Datamonitor D A T A M O N I T O R

APPENDIX



CHAPTER 10 APPENDIX

10.1 Methodology

Datamonitor Industry Profiles draw on extensive primary and secondary research, all aggregated, analyzed, cross-checked and presented in a consistent and accessible style.

Review of in-house databases – Created using 250,000+ industry interviews and consumer surveys and supported by analysis from industry experts using highly complex modeling & forecasting tools, Datamonitor’s in-house databases provide the foundation for all related industry profiles

Preparatory research – We also maintain extensive in-house databases of news, analyst commentary, company profiles and macroeconomic & demographic information, which enable our researchers to build an accurate market overview

Definitions – Market definitions are standardized to allow comparison from country to country. The parameters of each definition are carefully reviewed at the start of the research process to ensure they match the requirements of both the market and our clients

Extensive secondary research activities ensure we are always fully up-to-date with the latest industry events and trends

Datamonitor aggregates and analyzes a number of secondary information sources, including:

- National/Governmental statistics - International data (official international sources) - National and International trade associations - Broker and analyst reports - Company Annual Reports - Business information libraries and databases

Modeling & forecasting tools – Datamonitor has developed powerful tools that allow quantitative and qualitative data to be combined with related macroeconomic and demographic drivers to create market models and forecasts, which can then be refined according to specific competitive, regulatory and demand-related factors

Continuous quality control ensures that our processes and profiles remain focused, accurate and up-to-date

APPENDIX



10.2 Industry Associations

Canadian Restaurant and Foodservices Association 316 Bloor Street West, Toronto, Ontario M5S 1W5, Canada Tel :1 416 923 8416 Fax :1 416 923 1450 http://www.crfa.ca

10.3 Related Datamonitor Research

Datamonitor Industry Profiles

Global Foodservice

Foodservice in Germany

Foodservice in the United Kingdom

Foodservice in France

Foodservice in the United States

Foodservice in Italy

Foodservice in Mexico

Foodservice in Taiwan

Foodservice in Norway

Foodservice in Denmark

Foodservice in Hungary

data monitor report on food services

Documents