By J. Perry Maisonneuve
Consumer tastes, preferences, and demands are ever-changing. Retailers are faced with difficult choices in meeting the increasingly challenging and uncompromising demands of today’s millennials; as well as the pressing needs of aging baby boomers. As a result, new retail businesses in the marketplace suggest understanding and catering to the similarities between these seemingly divergent consumer groups is the key to success.
Demographers such as economics professor David Foote (University of Toronto) and author of the 1996 book Boom, Bust and Echo, defined baby boomers as those born between 1947 and 1966. As Canada evolved into a service-based economy after World War II, this group became desk-jockeys living sedentary lifestyles and subsisting off carb-heavy, light and deep-fried fast food. To this end, many from this demographic are out-of-shape, and are often suffering from health issues. Further, many from this generation are now retiring on fixed incomes or being replaced in the workforce by younger, newly educated, highly computer literate, and far more cost-effective talent with increased energy and enthusiasm.
In contrast, millennials are defined as those born between 1981 and 1996, with this group currently between the ages of 22 and 37. Having been raised in the Internet age, they represent one of the most tech-savvy generations.
A shift in the real estate landscape has resulted in the older generation selling their single-family homes and downsizing to smaller, condominium apartments, and townhouses with lower-costs and maintenance. This trend also helps this group use the value in their homes to supplement retirement incomes. In contrast, changes in mortgage approval criteria has made it increasingly difficult for millennials to qualify for an average-priced house. As a result, the residential condominium market, including townhomes, have increased in popularity. With these changes in housing behaviours, a new franchise concept emerged called Aisle 24.
Created by John and Josh Douangprachanh and Marie Yong, Aisle 24 is a business with a fresh take on the traditional convenience store retail outlet. Aisle 24 offers customers 24-hour access to fresh foods and other grocery items. Presented in a small-footprint, Aisle 24 caters to tenants living in condominiums, apartment buildings, townhouses, and student residences. The franchise offers product and location convenience combined with state-of-the-art technology.
The technology is reflected in every aspect of the business model. By downloading a mobile app, customers can register their membership, and connect their credit card for future payments. Once signed up, they can access the store by tapping their mobile device against the door reader, or tapping the access button in the mobile app. Clients can then select the products they need and check themselves out through a cashless, self-serve, point-of-sale (POS) system. Franchisees manage and maintain the location through a series of software applications on their iPad. These apps seamlessly facilitate every aspect of the business from inventory counts, product order and receiving, sales, banking, and payables.
This technology results in the franchisee being required as the only staff member. Product management and merchandising represents only a part-time commitment throughout the week. Pre-registered, self-serving customers shopping in a cashless sales environment completes the picture of a profitable, low-investment franchise with the potential of a full-time income for retired adults in return for a part-time commitment. Entrepreneurial-minded millennials can also pursue their aspirations by owning and operating one or more of these types of franchises. Those comfortable with the technology being used, young adults can benefit from this proven business model with streamlined operations to further develop their business skills.
The rise of QSRs
Aging adults and health conscious, eco-friendly millennials have also impacted the food-service industry—in particular the quick-service restaurants (QSR) segment. Consumers of all ages are avoiding carbohydrate-heavy diets consisting of french fries and other potatoes, pastas, rice, breads, and other starches while trying to minimize the myriad forms of sugar seemingly in everything one eats and drinks. As a result, Ontario’s Ministry of Health now requires restaurants to provide caloric count on their menus. The convenience of quick-service and drive-thru venues is no longer enough to justify poor diet with adverse health consequences.
That said, a whole generation of new QSR concepts has arisen to supply the varying group’s demand for fast and convenient service with fresh, wholesome, eco-friendly food products. Perhaps, one of the first of these franchise concepts is Freshii’s. In turn, Freshii’s has been followed in swift succession by Copper Branch (a Montreal-based vegan QSR), Quesada (a Toronto-based Mexican QSR), Basil Box (a Toronto-based Asian Fusion QSR), Chef’s Door, (a Toronto-based Halal Middle Eastern QSR), and many more.