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One Restaurants Canada executive said he’s ‘not surprised at all’ the two companies have decided to open shop in Alberta
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Two new food chains are setting up shop in Alberta for the first time, but many of the province’s residents will already be familiar with their names.
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U.S.-based food chains Chipotle Mexican Grill and Crumbl Cookies recently announced they’re entering Alberta for the first time, bringing two immensely popular food chains to the Prairies.
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Crumbl Cookie’s announcement it was expanding into Canada started with opening its first store in Edmonton this March, and its Airdrie store opens Thursday, June 22. Crumbl has gained tremendous popularity — and done so in short order — in the U.S. for its dessert cookies.
The company, which boasts a library of 170 cookies and nearly seven million followers on TikTok, has opened more than 800 bakeries in the U.S. since starting up five years ago, its website says.
Meanwhile, Chipotle’s expansion into Alberta will add to its growth in Canada, where it’s had a foothold since 2008. Until now the company has limited itself to Ontario and B.C.; 19 of its 34 locations are in Toronto and surrounding municipalities such as Vaughn and Mississauga. Another eight are located in B.C.
Chipotle’s Calgary location will be in the northeast Sunridge neighbourhood sometime in the fall. The new restaurant will be one of the few in Canada featuring Chipotlane, a system where customers can place an order on the company app and, upon arrival, drive up and grab their meal from a pick-up window.
After implementing a Canadian team in 2019, it’s planning on opening 10 new restaurants by the end of 2023, according to Anat Davidzon, managing director of Chipotle Canada.
“One of those commitments was to develop the Canadian market and with that, additional resources and investments were made to create a very strong team that will allow the growth of the market with with a lot of local focus, as opposed to control or … strategizing from the U.S. team,” said Davidzon.
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Davidzon said Chipotle had only decided to enter Alberta now because it has the operational capacity to do so.
“Honestly, we weren’t equipped to spread across the whole country,” she said.
“Strategically, we chose to be in Vancouver and Toronto and penetrate different provinces — then we have the ability to operate the restaurants the way we intend to.”
Davidzon said the company plans to develop Calgary and Edmonton locations in the coming years.
Low Alberta taxes are a draw
Seeing two prominent U.S.-based food chains make their first attempts at breaking into Alberta came as no surprise to Mark von Schellwitz, Restaurants Canada’s vice-president of Western Canada.
“Alberta’s actually one of the usual places that U.S. chains expanding to Canada go into first because it’s probably got the most competitive tax and regulatory environment that’s the most similar to what they’re dealing with in the states that they’re operating in,” said von Schellwitz.
“So, not surprised at all,” he said, adding the province’s lack of a provincial sales tax, eight per cent corporate tax rate — the lowest of all Canadian provinces — and low liquor prices make it an appealing place for chains to settle operations.
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Entering Canada, as Crumbl Cookies did in March, still requires companies to understand the different regulations, food costs, and municipal and development laws.
American portion sizes also tend to be larger than in Canada, von Schellwitz noted.
A failure to recognize those factors — from regulations to often higher food costs in Canada — is why some American companies flounder when they enter the Canadian market.
“A successful U.S. company does have to pivot towards what Canadians want,” he said.
“They’ll have to adapt, and hopefully they’ve done their homework to see what the different operating environment is up here versus where they’re located in the States.”
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