Sylvain living his life at the eye of the storm this past weekend as Atlantic Canada got pummelled by an epic storm - and we talk about another storm, his call out for grocers to freeze pricing…Our special guest on this episode is based in PEI, Peter McLaughlin President and Managing Partner at ANNE of Green Gables Chocolates
Sylvain living his life at the eye of the storm this past weekend as Atlantic Canada got pummelled by an epic storm - and we talk about another storm, his call out for grocers to freeze pricing…
Our special guest on this episode is based in PEI, Peter McLaughlin President and Managing Partner at ANNE of Green Gables Chocolates
A reminder to everyone we will podcasting live and interviewing a whole slate of guests at the upcoming Coffee Association of Canada Conference, in Toronto at the Globe and Mail Centre….November 14…..get your tickets today and come by and say hi
We update the listeners on the global food impacts of the Ukraine war - from a food perspective some grains have flowed out of their ports - but take us through the state of fertilizer, your level of concern for Africa and the middle east, Europe, and overall the global supply of grains etc.
Peter McLaughlin was born on Prince Edward Island, one of the four Atlantic provinces in eastern Canada. He earned his BS degree from St. Francis Xavier University and his master’s degree from the University of New Brunswick. From 2016 to 2018, he was president of Interbake Foods in Richmond, Virginia, a leading North American private-label biscuit, cracker, baked dairy products, and filling equipment manufacturer. He was with Loblaw Companies Limited, Canada’s largest food retailer with food distribution divisions across the country, for nearly 20 years. He was president, Emerging Business Division and senior vice president of several businesses including National Wholesale and Deli, Home Meal Replacement & Bakery. From 2012 – 2016, he chaired Loblaw’s Diversity and Inclusion Council. Peter and his wife, Niki, have two sons, Riley (age 21) and Brogan (age 19) and a daughter, Bayley (age 18).
Dr. Sylvain Charlebois is a Professor in food distribution and policy in the Faculties of Management and Agriculture at Dalhousie University in Halifax. He is also the Senior Director of the Agri-food Analytics Lab, also located at Dalhousie University. Before joining Dalhousie, he was affiliated with the University of Guelph’s Arrell Food Institute, which he co-founded. Known as “The Food Professor”, his current research interest lies in the broad area of food distribution, security and safety. Google Scholar ranks him as one of the world's most cited scholars in food supply chain management, food value chains and traceability.
He has authored five books on global food systems, his most recent one published in 2017 by Wiley-Blackwell entitled “Food Safety, Risk Intelligence and Benchmarking”. He has also published over 500 peer-reviewed journal articles in several academic publications. Furthermore, his research has been featured in several newspapers and media groups, including The Lancet, The Economist, the New York Times, the Boston Globe, the Wall Street Journal, Washington Post, BBC, NBC, ABC, Fox News, Foreign Affairs, the Globe & Mail, the National Post and the Toronto Star.
Dr. Charlebois sits on a few company boards, and supports many organizations as a special advisor, including some publicly traded companies. Charlebois is also a member of the Scientific Council of the Business Scientific Institute, based in Luxemburg. Dr. Charlebois is a member of the Global Food Traceability Centre’s Advisory Board based in Washington DC, and a member of the National Scientific Committee of the Canadian Food Inspection Agency (CFIA) in Ottawa.
Michael LeBlanc is the Founder & President of M.E. LeBlanc & Company Inc and a Senior Advisor to Retail Council of Canada as part of his advisory and consulting practice. He brings 25+ years of brand/retail/marketing & eCommerce leadership experience, and has been on the front lines of retail industry change for his entire career. Michael is the producer and host of a network of leading podcasts including Canada’s top retail industry podcast, The Voice of Retail, plus Global E-Commerce Tech Talks , The Food Professor with Dr. Sylvain Charlebois and now in its second season, Conversations with CommerceNext! You can learn more about Michael here or on LinkedIn.
Be sure and check out Michael's latest venture for fun and influencer riches - Last Request Barbecue, his YouTube BBQ cooking channel!
Michael LeBlanc 00:04
Welcome to The Food Professor Podcast Season 3, Episode 2. I'm Michael LeBlanc.
Sylvain Charlebois 00:09
And I'm Sylvain Charlebois, The Food Professor.
Michael LeBlanc 00:12
Well Sylvain, you do sometimes live your life at the eye of a storm. But this past weekend, Atlantic Canada got pummeled by an epic storm, Fiona. How are you doing? And how, how are you? How's the family, is everyone okay?
Sylvain Charlebois 00:24
We're good. We're, we're obviously (inaudible) in Halifax, and Halifax didn't see the eye of the storm. But it really, you know, you do underestimate the fear you can experience when a hurricane hits your house in the middle of the night. You don't see anything, you lose power. And you just hear, you just hear noise, and you can feel the house shaking. Like for hours and hours and hours and you're just waiting for daylight to come up so you can see all the damages. And yeah, we lost part of our porch in the back and a tree. And that's it, but then our families are doing great. But I feel for our friends over in Cape Breton and I have some friends over in Cape Breton and PEI and I will be talking to Peter a bit later during the show. And he's on, he's on the island. So, they really were hit really, really hard. So, I feel for them for sure.
Michael LeBlanc 01:20
Now you sound you and I actually sound a bit different. I'm in a hotel in Vancouver, out here on some business and, and you're in a hotel as well. But I think that's because you've got no power, right?
Sylvain Charlebois 01:30
We don't have power. We haven't had power since Friday. And we don't expect to get any power back until at least Wednesday, probably. So, I'm actually going to be traveling this week, but my family is going to be here at the hotel so they should be fine. I mean, we're all healthy. We're all good. And, and authorities here are doing a great job cleaning things up and yeah, I mean, we've, this is not our first hurricane. It's actually our third one since we've been in Halifax. This one was the hardest in my, in my view. But I must say, (crossover talk),
Michael LeBlanc 02:07
Hardest in terms of the most violent like the, the most,
Sylvain Charlebois 02:10
Exactly what you mean. Yeah.
Michael LeBlanc 02:12
Speaking of our guests, you mentioned Peter and speaking of the eye of the storm, our special guest this episode is based in PEI, Peter McLaughlin, President & Managing Partner at Anne of Green Gables Chocolates. This it's a great discussion. We'll get to it later, a veteran retailer, he's got food service experience on the Board of Gordon Food Service. And, you know, from the, from the, you know, from a wonderful province and island of Pei, the food island, so we get into a bit of that strategy and his product. So, it's a great discussion.
Sylvain Charlebois 02:41
Oh, yeah, absolutely. And I've always been impressed with, with Canada's Food Islands strategy, a lot of Canadians don't know are not aware. But there's lots going on like for an island of 140,000 people. There's lots going on. So, I was happy that Peter accepted our invitation.
Michael LeBlanc 02:58
Let's talk about another eye of the storm. This callout you made for grocers to freeze pricing. I hear the headhunters are calling looking for marketing, (inaudible) soliciting you for marketing gigs, at groceries. Let's, let's, let's take a step back. What, what was your objective when you did that tweet and on what data or research and, and what information? were you referring to what, what were you thinking when you, when you've gotten into that narrative a little bit?
Sylvain Charlebois 03:26
No, it's a fair question. And frankly, it's something that I've been thinking about for quite a while because you may, you may know this, Michael, over in Europe, where the food inflation rate is well above 10%. It's been 10%, above 10% for a while, the UK is at 13.5%, Germany's at 16.6%, right now.
Michael LeBlanc 03:48
Sylvain Charlebois 03:49
Yeah, we're number three within the G7. But some European countries are hurting. And some grocers have decided to voluntarily freeze prices for a few staples. Not, not a whole lot, just about 100 strategically, and it's been going on for months. We saw Leclerc in, in France, Carrefour in fr-, in France and Germany, also Vice, Lidl, these are not small chains. And, and, and the goal was basically to connect with the public, a struggling public with, with, with the food inflation rate at, at 13%. You, you got to sympathize with them. And the whole idea was, was, very much about public relations. It was about showing because over in Europe, they were accused of gouging, they were accused of regulation, which is exactly what's happening right here in Canada. And I thought well, that's certainly a very quick and easy way to start showing to the (inaudible) public. You know what, we feel for you, we want to do something significant. We, we, work with our vendors and we're, we're basically just freezing just for a couple of weeks, or maybe a couple of months, prices for a few staples. So, you can breathe a little bit and, and, and cope with, with higher food prices. So, that's kind of where I was coming from. I have zero data. I don't know whether or not it works. But over in Europe it, it seems to have the rhetoric around profiteering and all that has died down a little bit since, since we started to see, I think Leclerc was the first one out of the gate. I think it was back in March or April.
Michael LeBlanc 05:38
Now you say you have zero data. But that's, that's being a bit humble from the lab, you, you're talking to consumers all the time. What, what kind of threads are you picking up from that research that would lead you to think this would be a good strategy for our, our grocers? And then, and then I want to talk about Michael Medline has comments about, about the gouging and the profitability, but, but any data that you have, that you could refer to.
Sylvain Charlebois 06:00
Well, I mean, (crossover talk), last week, last week was, we saw August numbers with inflation. As you know, Stats Canada published its report on Tuesday. And (inaudible) then on, on the same day, we actually released the results of a survey, we surveyed 5000 Canadians on how they're coping with food inflation. I, I see two camps right now in Canada, 75% of Canadians are coping with inflation the best they can by doing all sorts of things. We're telling them to do some advice, we're giving them are coupons, flyers, go to discount stores, loyalty points, food waste,
Michael LeBlanc 06:36
Private label whatever, (crossover talk), whatever strategy they can choose. Yeah, whatever.
Sylvain Charlebois 06:39
Exactly. And so, people are changing habits. Because unlike 1981, this food inflation scenario is lingering. For 13 straight months now, the food inflation rate has exceeded the general inflationary in Canada. So, people are noticing higher prices at the grocery store. And so, they're changing their habits. So, that's the first 75%, the other 25% they're struggling, like, a lot. People are skipping meals; they're using credit cards to pay for their groceries without knowing when they're going to pay for their balance. They're, they're actually buying just literally less food, 24% of Canadians are actually buying less food in volume, okay, compared to last year. And of that 24%, almost 70% are women. So, you have to think about the single parent families out there. So, a lot of people are struggling, and which is why and, and I, I, I really get upset when I see a lot of people accusing grocers of, of gouging and because there's no, there's no data, there's just no proof. There's, we did the work over the summer, we looked at financial statements and, and these accusations are, are baseless. And so, that's why I kind of sent out that tweet saying listen, I think it's time to think about, you know, promotions, and this particular market a little bit differently now.
Michael LeBlanc 08:08
Well, I was going to say the only person who seemed more upset about it was Michael Medline. President and CEO of Empire, (inaudible). He was, he was quite vocal, as Michael is on, on,
Sylvain Charlebois 08:19
Michael LeBlanc 08:20
On many issues about being accused of gouging and, and he said rightfully so, people don't understand the industry. I think you're on the right side of that argument. I mean, I've seen you in the news a couple of times, saying listen, I don't see any evidence for that. You know, I think what people if there's anyone listening to the podcast, that isn't part of the industry, you also have to understand that groceries is part, is a business of scale, right? I mean, it's a high fixed cost, that more volume goes through, and all those kinds of tweaks and changes that leads to you know, better, better business, but it's still, you know,
Sylvain Charlebois 08:53
Oh, yeah. (Crossover talk). Well, what upsets me, Michael, is that we often hear whether they're, they're, they're, they're showing record profits. Well, at 2% in 1990 is not the same thing as 2% today, money wise, and that's the thing. And so you have to look at percentages and percentages, gross margins have been very consistent the last five years. So, yeah, I think I think, but do, am I surprised that Canadians are actually accusing grocers? No, I'm not because there is. But we've seen some, some issues in the past with bread, for example. So, and, and, and that, that, that appears to have been unresolved, because all we saw was Loblaws admitting along with Western Bakery, and when they admitted back in December 2017. They basically said that everyone else was involved but we haven't heard anything from the Bureau's nothing since. So, that's why I think Canadians are very skeptical. And, and I think from a PR perspective, grocers need to think about the market a little bit differently. They need to appreciate why Canadians are a little upset with them. But I absolutely appreciate where Michael Medline is coming from. I, I, I appreciate his frustration.
Michael LeBlanc 10:14
Well, we mentioned the Lab, what's, what's coming up next out of the Lab in terms of research?
Sylvain Charlebois 10:20
Well, I mean in, in terms of research. we're, we're. pretty busy in terms of prepping for Canada's Food Price Report. As you know, it's always out in, in, December. We have a couple of reports looking at coffee consumption, and, and also pets as well. But inflation is really the big one right now, we're actually looking at other things. Over the summer, we released a Best Before Date Study, which attracted way more attention than we expected. And so, we're looking into that as well. The other thing that we're working on right now is seniors’ homes. So, we're actually looking at food in seniors' homes. So, we may actually have a report before the holidays, on, on, what's going on with, with food in seniors’ homes and residences, how managers are coping with higher prices there, and how, how their menu has been, has been adjusted as a result of higher food prices.
Michael LeBlanc 11:19
Interesting. Now, I heard you mentioned, and mentioned coffee. So, let's call out the Coffee Association of Canada. They've got their Annual Conference coming up The Road Ahead 2022, November 14, The Globe & Mail Centre in Toronto, you will be speaking, and you and I will be podcasting together.
Sylvain Charlebois 11:37
Michael LeBlanc 11:38
So, if anyone, if anyone is in that industry, they should definitely be at the show. But also, you should definitely stop by and say hi. So, we're looking forward to seeing you in person again. And maybe I can get you over to the, to the Last Request Barbecue set. And we've got, I've gotten, I've, I've got exactly, I know what I want to make with you. So, just before we get to our interview with Peter, I wanted to ask you this one question about crickets. I was reading and I was reading that the cricket plant or cricket manufacturing are growing in London have a success, with a, with a wholesale deal. What do you say about the forecast or the future for cricket protein?
Sylvain Charlebois 12:21
It's more controversial than I expected to be honest, Michael, I mean, there was an announcement. I think it was last week that Aspire out of London, the largest cricket manufacturer in the world, actually just secured a deal with Korea. And, and it got me thinking a little bit because this plant has received, I believe, two grants, not one but two grants, multi-million dollar grants to operate and make crickets. Crickets is food, whether you like it or not, it is food,
Michael LeBlanc 12:34
Sylvain Charlebois 12:36
The plant is actually designed to manufacture a food ingredient. And now we're exporting these crickets with this new deal. We're going to be exporting crickets, to, to Korea, and so people are wondering whether it's an appropriate thing to do, or should we be subsidizing exports only? Should we look at the (inaudible) market? So, there's it, it raised a lot of questions that I thought were important. So, yes, insects may have a future as a food ingredient. I think I actually agree with that. I think there is a future, but should the government subsidize food exports? Because Aspire is not, as far as I know, Aspire does not manufacture any, any, any crickets for the domestic markets. At least not yet.
Michael LeBlanc 13:48
Let's, let's get to our interview,
Sylvain Charleboios 13:52
Michael LeBlanc 13:54
With, with Peter McLaughlin, President & Managing Partner at Anne of Green Gables Chocolates. Peter, welcome to The Food Professor podcast. How are you doing this morning?
Peter McLaughlin 13:59
Great, Michael. Thanks for having me.
Michael LeBlanc 14:02
Well, thanks for, for making it through, Fiona. I guess you've lost some power. You're, how are you? How are you doing? How's everyone and is your family, okay.
Peter McLaughlin 14:10
Families Great. Yeah, we were very fortunate. Thanks for asking, you know, the island is, you know, busy cleaning up and yeah, it was, it was quite a quite a couple of days. But we're true islanders were getting through it.
Sylvain Charlebois 14:24
Yeah. Now are you located in Charlottetown? Your house?
Peter McLaughlin 14:28
Yeah. Just outside of Charlottetown in a place called York Point.
Sylvain Charlebois 14:31
Okay, York Point. Okay. Well, we're glad that you're, you're safe. And I mean, in Halifax it was, it was quite rocky. So, I can't imagine how things were on the island.
Peter McLaughlin 14:42
Yeah, yeah. I've never seen anything like it. It was, it was almost out of this world. But we're, we're thankful that everybody made it through okay,
Michael LeBlanc 14:50
Let's talk about you and your product and what you're doing and all that great stuff. So, tell us a bit about yourself, your background, experiences and what you do for a living.
Peter McLaughlin 14:59
Yeah. Yeah, thanks. Thanks so much. You know, I'm a proud Islander father of three amazing young adults. And now a fourth-generation food entrepreneur here on PEI. I spent pretty much my whole career so approximately 25 years with Canada's largest company after doing my undergrad at (inaudible) and my grad degree at University of New Brunswick. And today, I lead a small but talented management group or management team at ANNE Chocolates, well, while serving on the Gordon Food Service Board and, and, and Holland College Foundation Board and, and, and a couple of other volunteer positions similar to that. So, yeah, that's, that's me, that's me today. And I say I'm a fourth-generation entrepreneur because my great grandfather emigrated from Ireland and started a food company and it was eggs and poultry and fruit and vegetables, eventually into a Broad liner. And I'm looking at his truck right now, on my, I have his picture on my desk. And, you know, he had 10 trucks on the road. And eventually my grandfather ran it and my father ran it and so I you know, it's come full circle now that I'm, you know, after working in the food business my whole life, I'm, I', back to being an entrepreneur, which is,
Michael LeBlanc 16:22
Yeah, you took that, you took that DNA and put it into, into some pretty senior, pretty senior positions at, at it Loblaw right, you were at Loblaws for (crossover talk),
Peter McLaughlin 16:30
Yeah, I was, I was at Loblaws, yep, yeah, I was there for my whole career, basically.
Michael LeBlanc 16:36
All right. Well, listen, let's, let's, let's talk about the present. Tell us about Anne of Green Gables Chocolates, the origin story, the background, scope and scale of the business and, and what makes you and your product different?
Sylvain Charlebois 16:45
Just so you know, Michael and my family and I were in PEI for Labour Day weekend, and we walked by the Anne of Green Gables Chocolates store. And yeah, and we actually bought some of it. It was great.
Michael LeBlanc 17:01
(Crossover talk) Awesome. (crossover talk), firsthand experience.
Sylvain Charlebois 17:04
Yeah, we actually saw the musical ff course, I have three daughters. So, I had to do that.
Peter McLaughlin 17:11
I'm so happy you did. I think that's quite magical. And, and as I always say, anybody who comes to the island, I offer them the Chocolate Factory Tour and free chocolates. So, next time you're over, I'd love to, (crossover talk),
Sylvain Charlebois 17:23
I should, absolutely. I'll make a note of that, for sure.
Peter McLaughlin 17:25
Yeah, yeah, I would love to have you. And, and so Anne of Green Gables Chocolates was founded in the late 90s. So, we're approaching 25 years in business. And, you know, it was founded as part of COWS Ice Cream. So, the famous COWS Ice Cream was, it was, founded as, as part of that. It was originally run out of a small chocolate factory in Cavendish in a place called Avonlea Village. And, and, it went along as, as a, as a retail business until i bought it. I bought into the business, I should say. So, I'm the President & Managing Partner in 2018, 100 amazing team members at, at peak season, we operate five companies stores, one wholesale store, now an online business, which we'll probably talk about later. And a wholesale business which is, which is you know, deep in my blood and DNA, and selling to people like Loblaws now and Sobeys, and some local, you know, great retailers that are local here, Murphy's and Mel’s and Kays Wholesale and, and, you know, we simply like to deliver happiness at Anne, and I know that sounds, it sounds kind of corny in some respects, but it helps us run the business every day. And we believe that our product generally delivers on, on taste, we put it up against the best chocolates in the world. And we've tried that in some blind taste tests. So, we think we have some great Island traditional recipes made by hand, here on PEI and the secrets starting to get out as we, as we start to leverage distribution through some of our, our retail partnerships. And, and that's kind of Anne in a, in a nutshell, I'm super thankful to be home in PEI and working in the food business.
Michael LeBlanc 19:13
Tell us a little bit about the you know, the chocolate business has evolved in terms of flavour profiles, I'm sure since the business was founded, and since you've taken it over, give us a sense of you know, how you explore more adventurous flavor profiles or what's your range of your product?
Peter McLaughlin 19:28
Yeah. I, I think, Michael, our range is, is, we make about 120 items in the factory. We're probably most famously known for COW Chips. So, Anne of Green Gables Chocolates owns that brand, and we basically have chocolate covered potato chips. It's sold in, in hundreds and hundreds of locations throughout the Maritimes and some in central Canada. And, and we've really focused on developing products. that are more wholesale friendly. So, stand up pouches or (inaudible) we call them.
Peter McLaughlin 19;49
For Superstore and Sobeys, we've developed a line of chocolate bars that are just absolutely amazing. And that, that is sold in, in many convenience and grocery stores and drugstores. And, and we have a line of Caramel Corn that was run as a separate company at one time that we amalgamated into about a year and a half ago.
Peter McLaughlin 20:00
And we have a unique item called PEI Mix. And it's kind of like Chicago Mix for PEI. So, we take our Spud Island Potato Chips, and our Caramel Corn and we, and we cover, we smother our potato chips and caramel and it's sold as a PEI mix. And it's become a mainstay for us. I'm amazed by how much momentum it’s; it’s received. And we started to package things in convenient, you know, 50-gram packages, so grab and go, as well as, as family size. So, our focus has been sort of updating the brand of the look and the feel, not as much product development, as you might expect, except for items that are going to be great wholesale items.
Sylvain Charlebois 21:10
That's great. I love those chocolate chips with, with, those, those chips with chocolate. Those are amazing. I think most of our listeners would have seen them somewhere. I have always been impressed with what, what goes on, on the island there. With Canada's Food Island and the strategy there. There's lots going on, there's the smart kitchen. It seems as though everyone plays a critical part. Could you explain to our listeners exactly what, how, how would you describe the, the manufacturing environment in the province right now with Canada's Food Island and, and the strategy that the province actually has for its agri-food sector?
Peter McLaughlin 21:50
Yeah. Thanks, Sylvain, I, I'm proud to, to repre-, you know, to represent part of the manufacturing sector, as you say, Canada's Food Island is alive and well. And I was amazed, as you know, coming home after being away for 30 years, about how the culture of food entrepreneurship has developed. And with things at your disposal, you know, simply picking up the phone, and having accent, access to Canada's Smartest Kitchen, which is, of course part of Holland College and The Culinary Institute, they can help you, you know, at any moment on packaging, product development, shelf-life testing, we also have this, we have this entity called Bio Food Tech. And it's actually positioned on the UPEI or University of Prince Edward Island campus. Again, we've done projects with them. They're ready, willing and able with food scientists, packaging engineers, you know, people that are, that are experienced. What, what I think I love the most about it, and then there's Canada's Food Island Group as well. What I love most about it is it's a very collaborative, tight network here. And for a small island, I'm sure we punched well above our weight in terms of,
Sylvain Charlebois 23:10
I would agree,
Peter McLaughlin 23:11
Yeah, the support, (crossover talk) for, for the entrepreneur, nothing makes me more proud, you know, when I end up in, you know, maybe in Boston or New York or, or wherever down, you know, when I see PEI mussels on the menu or, or PEI oysters or PEI potatoes, you know, those are, those have been mainstays. I have to give our provincial government you know, with help from many different areas, developing those great, what I'll call food brands, almost, you know, some of those are primary, you know, items that don't get further processed here in PEI. But there's, but there's lots of work being done in that sector as well. Yeah, I think we're super well positioned to help entrepreneurs. I just, I was amazed I didn't know the infrastructure was here to be honest.
Sylvain Charlebois 24:00
So what real-, what changed in the last, I'd say two decades or so? You were, you were away, you came back? What's, what has changed fundamentally on the island about agri-food in general?
Peter McLaughlin 24:12
Yeah, that's, that's, you know, I think it was rooted in, in, lobster and potatoes and mussels was probably someone's vision 30 years ago, I'm going to say, 20 years ago, oysters are coming on strong. It felt like to me someone had a vision for the island as a further you know, to further develop food products rather than just pulling potatoes out of the ground and shipping them somewhere. You know, we now have, have some of the further processing here and, and, and I, and I don't know whose vision that was, to be honest, Sylvain.But obviously it's starting to, to take root you have a company like Honey Bee, I'm not sure if our listeners know about Honey Bee but you can find their natural based throat lozenges across Canada across North America.
Michael LeBlanc 25:05
We had them on the podcast, they were a Canadian Grand Prix finalist. Yeah, we, (crossover talk), we interviewed them? Yeah, yeah, it was great.
Peter McLaughlin 25:11
They are, they are literally, you can see their factory literally from our factory. And that's how, that's, that's how small the island can be. But they just by, by, happenstance are close to us. And, but, but it's things like that, that, that kind of give you hope that we can thrive in this new environment. It feels like the culture and the infrastructures are working quite well. You know, not all success stories. Of course, you know, for every success story, there's one that doesn't, a brand that doesn't quite make it. But you know, we're, we're super thankful for everything that's there.
Sylvain Charlebois 25:50
Now you were in the grocery business for, for many, many years at Loblaws. Any transfer-, transferable skills you, you saw as valuable as you were transitioning into your current business, ANNE of Green Gables Chocolates.
Peter McLaughlin 26:11
Yeah, yeah. Sylvain, it's amazing, the amount of knowledge. You don't realize that you're gaining throughout, you know, two and a half decades. And I'm, I'm forever grateful for that experience. You know, I did have a chance to run the wholesale business for Loblaws. It's kind of an enigma there, not many people know about it, they operate the largest self-serve wholesale business in Canada.
Michael LeBlanc 26:18
Peter McLaughlin 26:20
That has been, that has been huge for me to understand. Understand how the distribution works. That's been probably the, you know, the biggest advantage, I think, believe it or not my very first job at Loblaws, I was a Category Manager, and I had the confectionery desk. They call it desk as in I had the confectionery category too, to watch over.
Sylvain Charlebois 26:38
Peter McLaughlin 26:30
And, and seasonal confectionery was part of that. So, I find myself, you know, going back to that experience, you know, back in the early 90s, just, you know, how does a buyer think? And what are they going to be looking for, and you know, what does a good sell-through look like? So, it's one thing to get sell-in, as in you get your product to the shelf, but getting it to, that's pushing, getting it to pull off the shelf, getting consumers to embrace it, that's, you know, all those things were, were, you know, I feel so lucky.
Peter McLaughlin 26:48
My, my last, I don't know if this is anywhere in my, in my bio, but my last job at Loblaws. They have a sister company called Interbake in Richmond, Virginia. So, I got to go down there and work with an amazing team on a bit of a turnaround, and it operates probably the largest biscuit and cracker private label business. In North America. We make the famous Decadent cookie. We made the famous Decadent cookie for Loblaws.
Sylvain Charlebois 27:15
Peter McLaughlin 27:17
Yeah, we made Walmart's cookies, private label cookies. We made the Girl Scouts of Americans cookies. I (crossover talk), yeah, I had so much great, great experience too, to sort of leverage off of in this new role. It's just hard to imagine. I just feel so lucky.
Sylvain Charlebois 28:23
Since you've been exposed to brands over the years. I'm just curious to get your thoughts about the Anne of Green Gables brand. So, obviously, on the island, it's everywhere. What do you think? Because it's been, it's been there for a very long time. My family and I just visited the exhibit on the island just a few weeks ago, they've done a really good job capturing this fictional character really. And, and but, it can't be done in other places other than the island. I mean, he just sells the island to everyone visiting the island. What do you think? What do you think the brand is right now? And,
Peter McLaughlin 29:01
Sylvain Charlebois 29:01
Anne of Green Gables in particular. And do you depend heavily on the success of that particular brand?
Peter McLaughlin 29:06
Yeah, it's a great question. It's a great question, Sylvain. And I, we have just started some of the primary research because our epiphany over the last sort of 24 months is our brand equity, like you say, in PEI, and even Atlantic Canada is strong with COW Chips and Anne of Green Gables Chocolates. People recognize the brand, top of mind awareness would be in the 80% range. And so, we feel good about our ability to pull products, you know, through the shelves.
Peter McLaughlin 26:29
You know, my initial impression in Ontario and when you go west, the top-of-mind awareness of even COWS, which was a sister company of ours, Anne of Green Gables Chocolates drops to sort of two out of 10, three out of 10.We've just started to sort of study that to try to understand what It will take just to get to build some brand equity to build some trust in trial in, in some of those larger markets. And so, you know, it's, it's an interesting question I love the brand it has, it's funny, you know, we'll go traveling throughout the US and I bet you one out of two, one out of three people, when we say Anne of Green Gables, they relate to it, at some point in their life had exposure to it. And when we say we're from Prince Edward Island, people,
Sylvain Charlebois 30:29
Wow, that many, hey.
Peter McLaughlin 30:31
Not many people know Prince Edward Island. But a lot of people recognize Anne of Green Gables. And so, that's, that was always of interest to me when I go see groups or I'm in a group outside of the country. The other epiphany we've had and we've, we've done a lot of work on this front is Japan. So, what the third largest, the world's third largest economy, and is, is a famous character.
Sylvain Charlebois 30:57
Oh, even when you visit the site? I mean,
Peter McLaughlin 31:00
Sylvain Charlebois 31:01
You can feel the, the, I mean many Asian tourists go there to take pictures. And they absolutely.
Peter McLaughlin 31:09
So, there's a love affair with Anne that dates back to the Second World War. And we've, we've begun to work with, with a great company over there in Japan. I can't say much about it, maybe, maybe you could have me back. And we'll talk about hopefully, we'll talk about a success story. (Crossover talk).
Sylvain Charlebois 31:28
Peter McLaughlin 31:29
But, you know, we've, we believe we'll have success in Japan at some point. And based on the reaction of some of the companies we've dealt with there, we can feel the excitement building. It's just going to take time, and as you know, from being around the food, business, regulatory approvals and logistics, logistic challenges of getting it across the ocean, across around, basically halfway around the world. But we're excited about that as a way to diversify our business and, and, and spread a little happiness from ANNE in, in Japan.
Michael LeBlanc 32:06
So, it's wonderful. Let's, let's change gears a little bit for the last couple of questions and talk about the food service industry, you're on the Board of Gordon's Food Service. So, you've got a bird's eye view, so to speak, tremendous, tremendous change during the COVID era, so much consumption transferred to grocery out of food service, and, and even today, many restaurants in Canada, you know, I was just in Vegas, and, and they're only open three days a week they, they can't find the people on one challenge to another. And from a big picture perspective, what do you think? You know, you've got people working from home instead of working at work. What's the prognosis for the foodservice business from your perspective?
Peter McLaughlin 32:43
You know, it's a, it's a great question, Michael, you know, the first thing I would say is, I do think it has a bright future. You know, I feel very fortunate to work at, with, with, you know, one of Canada's leading distributors like Gordon's is an amazing company, and, and health is coming back on the distributor side, for sure. I do see what you see though, I can go through some airports, and I'll see a dark Starbucks or a dark restaurant. And typically, what we hear from the field is that it is the labour crunch that is keeping many stores closed. Does that? I do think that it will come back to a balanced state sometime in the next 12 months or so. And, and, I think the whole supply chain probably comes back to a, to a better place in six to 12 months. And, and I do see people returning to, you know that the treat of eating out or sometimes the convenience of, of eating out we can see the trends coming back strong. So, so, we're excited about the future. I think there's always a nice balance of preparing great food at home and then enjoying someone else's, you know, creation, away from the home. Like, I think people will go back to enjoying that. You know, there's a little bit of talk of a looming recession. So, that's got us somewhat, all of us, (crossover talk),
Michael LeBlanc 33:22
Peter McLaughlin 33:23
Concerned. We, my wife and I own some seasonal restaurants. So, we have our ear to the ground on that stuff as well. Yeah, I mean, I just think, I think that business is, you know, it's, it's still going to be a great business, a strong business. I think you nailed it, though. The labour crunch has hit that one the hardest. And, and I think we're probably a year away from, from getting back to a steady state,
Michael LeBlanc 34:38
You know, early in the COVID period, some food distributors had toyed with, or played with direct-to-consumer, you know, come and we'll ship it to you or just kind of you know, because so many people were cooking home do you see that as, as an opportunity in general for food services to go where the people are like if you got a reduction in, in restaurants, or do you see that as competing with your core customer and you just want to stay focused?
Peter McLaughlin 35:02
Yeah, it's a good question. You know, I think I saw our competitor, you know, Sysco was our key competitor in Canada. I saw them as kind of aggressi-, more aggressively pursuing what I'll call the end-user. I don't know if you know this, and our listeners may not be aware, but in the United States, Gordon has a network of almost 200 stores. And they serve as I'll call them, you know, small, (crossover talk),
Michael LeBlanc 35:31
Cash and carry kind of thing, right? (Crossover talk), yeah, yeah.
Peter McLaughlin 35:33
And, and they serve as the end-user. So, like you and I, if we're having a tailgate party or for everything, our graduation party, they, you know, we would go in and buy our cake and our, our wings and our ribs. They serve a small independent food service customer. And they also, they also serve as our off-truck customers for filling orders in the US. It's, but it's in Canada, I would say, you know, my impression that, you know, is, is that's not, that's not in the cards anytime soon. But in the US, it's a, it's a thriving business for Gordons, and it's a proud, it's a proud part of, part of, the group.
Michael LeBlanc 36:12
Well, let's, let's wrap up with what's next for Anne of Green Gables Chocolates. So, where and, and of course, where can people go to learn more? And, and what's on the what's in the lab and what's next for the business?
Peter McLaughlin 36:22
Yeah, I think, you know, if I could summarize it, you know, we're going to continue to spread happiness. I know, that sounds, again, a little bit, a bit altruistic. But, you know, we see growth in, in the grocery channel, we see growth in Japan, we see growth in online. And, you know, new stores you know will be, will be slower on developing new stores, I think we have a new concept. That's, that's going to, we'll run out a beta test or a pilot this time next year, we'll be setting one up for the holiday season, which you know, the listeners hopefully will, will frequent. And (crossover talk),
Sylvain Charlebois 37:03
For the holidays, coming holidays or (crossover talk) or 2023.
Peter McLaughlin 37:06
No, 2023, We'll have a, we'll have a, test here in PEI. And, you know, that concept to me has a little more of a broader range potential to spread its wings across Canada. So, we're going to try that we have a talented operator on our management team, and she's joined us and she's going to try that concept next Christmas. And so, you know, I think you know, we're going to continue to focus on quality and put out great tasting products and, and work with our retail partners is probably, the, the key area and we really hope we get Japan up and running. It will take a good year before that comes to fruition. And, and we just, you know, wish for continued health and happiness, you know, it's a, it's a great place to live, despite the remnants of Hurricane Fiona. And, and,
Sylvain Charlebois 38:01
Typically, it is a good place to live, absolutely.
Peter McLaughlin 38:03
Typically, a great place. A great place to be a food entrepreneur. And we just hope that we can, you know, grow and provide great jobs for many as the business develops over the coming, coming years.
Sylvain Charlebois 38:16
I got to ask you, one last, last question, Peter, there's, there is a myth out there. Many people believe that everyone on the island has to mow the lawn on Thursdays, Is that true?
Peter McLaughlin 38:29
Yeah, I mean, what you've noticed is the lawns are well kept. The lawns are always well kept. But if your lawn, (crossover talk) is long Boy, it's
Sylvain Charlebois 38:37
All green. It's amazing. Like, the Earth is red, and lawns. I mean, it pops up like you get as you drive through the night. It's just a beautiful, beautiful island.
Peter McLaughlin 38:48
Here's where I think the myth comes from: somebody if you if your grass is long on a Tuesday, you're certainly allowed to cut it. But, but I think the islanders, if they think like I do, I go, Well, I want to have my weekends free to enjoy the island and, you know, go to the north shore or go to see Anne of Green Gables Chocolates. And so, I typically try to get my lawn cut on Thursday. So, I'm free Friday, Saturday, Sunday. I think that's probably where the myth comes from. But you'll notice as you drive around on Thursdays, that there's tons and tons of people mowing their grass and, and there's lots of PEI pride on that day.
Sylvain Charlebois 39:23
I mean, it's all well-orchestrated, I can tell you that Halifax is not that well organized. Oh, yeah. People will move along during dinner. Absolutely. Well, it's Peter. It's been great. I mean, talking about chocolate is never a hard conversation to have and yeah, your, your, successes Is, is, is a great inspiration for a lot of our listeners, for sure. Thank you for accepting our invitation on the food Professor podcast. Peter McLachlan, Anne of Green Gables Chocolates. All the best to you in the future.
Peter McLaughlin 40:01
Thank you to you both. I enjoyed, I enjoyed, our chat. Take care, guys.
Sylvain Charlebois 40:05
Michael LeBlanc 40:06
So, that was, that was, a great interview. I mean, it's interesting hearing right on the ground level from the, you know, the food island of the innovation happening. It is funny he was, you can see one of our other guests out his window kind of thing, so much experience. And it was great to have perspective both on the bigger broader industry and food service, too.
Sylvain Charlebois 40:23
I mean, it's not our first guest from PEI. But there's something really special going on in PEI. And I think Peter captured exactly the IT strategy, which is working very well for the island. And yeah, Peter's successes are noteworthy. And he's done an amazing job with the company. So far, he's carrying a very important brand for the island and Canada. And so, yeah, that was, I was so happy that we were able to chat with him today.
Michael LeBlanc 40:51
Last couple of questions for you, I wanted to revisit in this our second episode of our third season your perspectives around the global food impacts of the Ukraine war. So, you know, when we left off from our last season, it was pretty bleak. We weren't sure if there's going to be enough fertilizer, we weren't sure if they were going to be able to get any of their product out. We weren't even sure they're going to be able to make a product. Now, we had a few. I guess bright spots with a few boats leaving the Ukraine. I want to get your assessment of the situation today. And of course, what I'm going to is, is do you think the situation will be as dire for Africa and the Middle East? Because they rely on Ukraine so much will Canada make up for it and other nations? What's, what's your overall assessment of where we sit today?
Sylvain Charlebois 41:35
The situation is still precarious, I think, for many regions of the world, including the Middle East, Northeast Africa, for sure. Now we're in the middle of harvest season in, in, the Northern Hemisphere, and we're going to be in a deficit. We're doing fine in Canada, there's lots of moisture out west. But it was a dry summer in Europe, and it was also a dry summer in Asia. So, there's, the market is much tighter than expected. And so, yeah. I think, the, the thing about, about trades is that it's important for things to, to, to be predictable. And what I'm hearing right now is that the tariff on, say, Russian fertilizers was a problem. But now, the farming community knows how to deal with it. I mean, as you know, businesses adapt very quickly. The last thing that farmers want is a change in policy, like a swift changing policy. So, there was an invasion in February. And, and obviously, countries had to react. But don't change the rules again, because people are planning right now for next year. So, that's the most important thing. And I, my guess, even with COVID, you can feel right now that governments are really super careful making changes to anything. Dur-, in, in the height of COVID, you saw policies change daily? (Crossover talk),
Michael LeBlanc 43:11
Yeah, yeah, (crossover talk), -
Sylvain Charlebois 43:12
I saw what happened to different sectors, including food service, I mean, that, that really, what these changes were blows, (crossover talk),
Michael LeBlanc 43:21
It was a whipsaw effect too, right, I mean, retail growth, (crossover talk) at first, you can be open and then you can't be opened. And, you know, yeah, yeah,
Sylvain Charlebois 43:27
I think we're now embarking in an era of, of valuing predictability for, for, especially for business. And so, whenever there's a war or a pandemic, I think, I think governments are starting to be a little bit more careful with, with playing with, with the, with the yo-yo, essentially, and just changing things as they go along, just for political reasons. I mean, it's and they've always, you know, sugar coated some of their decisions by, by, by saying that it was all about the science. I mean, people are smart, they don't necessarily appreciate being talked to like that. And businesses appreciate predictability way more now. And governments actually understand how powerful predictability can be. So, yes, we're going to be short this year, but for next year, I think that the farmers are getting organized knowing exactly what the rules are going to be.
Michael LeBlanc 44:23
Sylvain Charlebois 44:23
Michael LeBlanc 44:24
You mentioned, you mentioned the government. Now you're back testifying. Maybe I've lost track, maybe you already have but you are coming up here testifying at the House of Commons committee. (Crossover talk) What do you, what do you talk about?
Sylvain Charlebois 44:33
I testified yesterday for the second time this year before the Finance Committee. That was an interesting exercise, for sure. And the discussion was obviously about inflation, greed-flation came up. We talked about food autonomy, and, and like I said, predictability as well. So, hopefully, MPs listened but there was a group of academics also joining me and it was a great discussion I think, and all different political point of views were, were captured during, during an hour session I think the hour before us were trade groups, different trade groups that were invited and on our, on my panel it was all academic. So, it was great to connect again with the, with the, with the committee. The Finance Committee is the, is the workhorse of Parliament to be honest that I would say it's probably the one committee that works the hardest and, and has, has the most exposure. So, whenever you testify before finance, you hear from reporters, you hear from the media about some of the things you said.
Michael LeBlanc 45:44
You and I were on different mics today so we sound a little bit different, but we'll be back in a couple of weeks.
Sylvain Charlebois 45:46
Michael LeBlanc 45:47
That's in our next episode. Until then, make sure and you are probably listening to this on one of the major platforms but if you do subscribe. And if not, sign-up and, and get those alerts and then tell all your friends in the food service, restaurant and grocery industry to give us a listen.
I'm Michael LeBlanc, growth consultant, podcaster and a bunch of other stuff.
Sylvain Charlebois 46:11
And I'm Sylvain Charlebois, The Food Prof-,
Michael LeBlanc 46:13
(Inaudible) We're out of practice, (inaudible), we're, we're, so many time zones away from each other. Anyway, stay safe. It's great to hear you and the family are safe. Best wishes to everyone in Atlantic Canada from, from this side of the country and I look forward to speaking with you again soon.
Sylvain Charlebois 46:29
Take care, Safe travels Mike.
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