There’s no real easy business to be in terms of winning market share or customer acceptance. However, one sector that is especially competitive is the food and beverage industry.
That is especially true in Saskatchewan.
StatsCan periodically looks at the operating performance of businesses in a broad sector. The latest they’ve examined is food and beverage. Nationally, revenues have been rising faster than in this province. In fact, PEI saw prices and revenues go up the most rapidly, while Saskatchewan proprietors saw the slowest top-line expansion for two years in a row.
And that resulted in pressure on operating margins. In 2013, operating margins or gross profit for this sector was 7.2 per cent in Saskatchewan. By 2017, the most recent period with available information, that had fallen to a smidge over five per cent. In other words, money left for those taking the risk of opening a business in this sector had fallen by roughly 30 per cent.
The biggest factor in squeezing the bottom line was operating costs. It’s little wonder this industry makes noise when governments force higher costs onto them such as increased minimum wages or a carbon tax. And it seems they are not able to pass those along to the consumer.