2.5 minute read time
March 9, 2021

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It's not all bad news on the retail front. Restaurant entrepreneurs have taken advantage of declining rents and mounting concessions to secure high-profile locations that are rarely available. And many new innovative retail concepts are emerging, such as ghost kitchens and robots.

Here are some retail trends we're watching in 2021.

Ghost kitchens

While COVID-19 has had a devastating effect on the restaurant industry, it has created significant demand for food delivery and has accelerated the growth of ghost kitchens.

Ghost kitchens produce food exclusively for delivery and takeout via apps like Uber Eats and DoorDash. Some ghost kitchens host several different brands, including those that have dine-in locations and want to expand their delivery capabilities and other brands that are only available by delivery.

According to a July 2020 report by Euromonitor International, ghost kitchens could create a US$1 trillion market by 2030. There are approximately 1,500 ghost kitchens in the U.S. and 7,500 in China.

Food Goes High-Tech

Technology and the adoption of robots is becoming more common in retail spaces. The grocery industry has been one of the first sectors to embrace these changes, with Voilà by Sobeys using Ocado’s touchless technology to pack orders at distribution centres.

Robots are being introduced at the store level too, and they are performing a variety of functions, from roaming around looking for spills to clean, to scanning shelves to check inventory. Home improvement store Lowes has deployed ‘the LowBot,’ which can answer simple questions, direct shoppers to a product and assist with inventory monitoring.

According to Harvard Business Review, one of the major benefits of robots is their ability to collect data on customer buying habits, which can then be used for more precise inventory management. The industry estimates that out-of-stock items cost retailers $1 trillion globally each year.

Opportunities Abound for Canadian Retailers

Sustainability a priority

Sustainability is being prioritized by both consumers and retailers, as an increasing number of consumers are looking to support brands that align with their values.

A 2018 survey from data platform Euclid found that 52% of Millennials, 48% of Gen Xers and 35% of Boomers want their values to be congruent with their preferred brands. Sustainable practices are crucial for the protection of our planet; they are also important for building brand loyalty and many retailers are taking note.

Walmart announced last year that it is targeting zero emissions across the company’s global operations by 2040. This year it will be testing all-electric and self-driving delivery vehicles to help achieve its target.

Retail may be changing, but our high street brokers are doing landmark deals as ready for life after COVID. - Werner Dietl

Loblaw is also testing driverless delivery vehicles. In the GTA, five self-driving vehicles will operate on five fixed routes on public roads seven days a week, 12 hours a day, with fixed pickup and drop-off locations. There’s no need for alarm, however: all vehicles will be co-piloted by a human.

On February 1, the company launched an online store in partnership with Loop that sells groceries and household items in containers that the company will take back and refill. Loopstore.ca currently lists just 98 products, although many are sold out or "coming soon."

The challenges are not over, but creativity, perseverance and new technology are paving the way forward for retailers in Canada.

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