The Cost of Doing (Food) Business in St. John’s

Limited Food Supply and High Import Costs Among the Challenges of Running a Restaurant on an Island

stephen and  kelly

Cover Story by Terri Coles

This is an exciting time for the culinary scene in St. John’s — our province’s restaurant and bar sales
led the country for growth in 2013.

“The culinary scene has improved by great leaps and bounds in the past few years,” said Greg Hewlett,
co-owner of Fixed. “For a city of some 200,000 people in the greater metro area, we punch well above
our weight class, so much so that the current scene constitutes a sort of golden age in St. John’s dining.”

But at the same time, as Newfoundlanders and Labradorians travel more often, many of us return home
wondering why it’s so hard to grab a meal here for less than $10 – even at a fast-food joint. Or why our
restaurants aren’t serving as wide a variety of produce as those elsewhere. Or even why a province
known for its fishing doesn’t have a wealth of great seafood restaurants.

The truth is that while there are a lot of great things happening for food in Newfoundland and Labrador
right now, challenges remain for the province’s restaurateurs – particularly when it comes to the cost of
putting meals on plates.

“It is next to impossible to serve quality food for anything less than what many consider rather expensive,”
Fixed’s Hewlett said of the prices local restaurants must charge to make a profit.

There are several factors at play. First, a lot of the food served here is imported into the province, particularly
outside of our short growing season. That importation has costs, from the time involved in sourcing ingredients
to the money paid to wholesalers and shipping companies to the price of the gas needed to get to Costco.

Restaurants also don’t necessarily get a wholesale price on the food they purchase to make their meals.
Rocket doesn’t get a discount on butter and milk, for example – two items that make up a good deal of their
offerings, particularly on the baking side. They are paying retail prices for a lot of the ingredients they use, said
Kelly Mansell, co-owner of Rocket Bakery & Deli on Water Street. When you consider that as well as the labour
costs for the time required to make food from scratch, and pay your staff, it adds up.

When it comes to those specialty items that aren’t commonly available at Sobey’s or Costco, the challenge grows.
Products that must be imported or used to serve a specialty audience are rarely available wholesale, said Julia
Bloomquist of The Sprout on Duckworth Street. “I find myself often scrambling around town from place to place just
trying to find a case of 5mm rice noodles because we are down to three more Pad Thais,” Bloomquist said, “and
whenever I find miso paste at a local grocery store I buy all of it.”

And alcohol, which makes up a considerable part of a restaurant’s profit, is another factor to consider. Mansell
suspects that many customers don’t realize that restaurants like Rocket don’t get a break on booze–whatever
the price is at the liquor store is what they’re paying.

“The reality is,” said chef and owner Stephen Vardy of Adelaide on Water Street, “if your food cost starts creeping
up over 35 percent, then you’re not going to be open to serve diners.” Fortunately, chefs and farmers around the
island are encouraging the development of the province’s agricultural offerings. Rocket works with farmers in
Whitbourne who are actually employed at the restaurant outside of the growing season. They provide produce
for its meals during the warmer months of the year.

Bacalao puts considerable focus on having relationships with local producers, said owner Andrea Maunder,
but that priority is time consuming because it means dealing with as many as 30 different suppliers instead of
one or two wholesalers.

But from high-end to casual, chefs and restaurant owners all said that support for local food production is key to
keeping the momentum going. Tuan Ly, owner of Saigon Bistro, grows herbs and sprouts he couldn’t source locally
indoors during the winter.

Jeremy Charles of Raymonds is well known for his support of hunting, fishing, and foraging. “Ninety-five percent of our
ingredients on our menu are all from Newfoundland,” he said, but he added that it took time to build the relationships
required to source those ingredients, and it’s particularly challenging during the colder months of the year.

Vardy of Adelaide is in contact with a local outfit working to provide the first Newfoundland oysters, but that is still a
couple of years away–in the meantime he drives to the airport several times a week to pick up hundreds of oysters.
He gets as much local fare as he can: Newfoundland cod, produce from Lesters, lamb from Ferryland, local beef
and pork when available. But the reality is that he wants to buy more local food than he is able to source.

That problem is widespread, said Maunder of Bacalao. At the same time, it is improving. Bacalao has been open
about eight years, and their local focus has become easier to provide over that time thanks to increased food
production on the island, she said. “Initially, there weren’t that many farmers we could go with to get what we needed.”

One of the keys to success for a local restaurant is to go niche. For example, The Sprout says what helps them stand
out isn’t just the restaurant’s menu, which is vegetarian with many vegan and gluten-free options, but also its
casual-but-healthy atmosphere. Saigon opened because there still wasn’t a Vietnamese option among the city’s
increasingly diverse slate of eateries, Ly said. And Charles of Raymonds is getting ready to open a more casual
offering called The Merchant Tavern on Water Street in the spring.

“There’s just so much room here to fill,” Vardy said. For his part, he’d love to see a noodle house in the city, more
options for late-night food, and microbreweries.

Hewlett hopes that as the city’s culinary scene continues to grow, self-reliance in food production and food security
do the same. “It’s the best possible way to improve every facet of the industry, from costing to quality,” he said.
“Work with what our land and seascapes provide us, devote ourselves to local sourcing, grow much, much more
food here at home, and diminish our reliance on imports to the very best of our abilities.”

Even with the challenges, the growth continues. “We decided to open a Vietnamese restaurant in St. John’s because
our food culture here has evolved quite nicely over the last few years,” said Ly of Saigon.

And we’re still riding the wave of a resurgence of provincial pride brought on by better economic fortunes and a
rediscovery of what Newfoundland and Labrador has to offer–and that includes our food. “A lot of my chef friends
around the country are pretty amazed,” Charles said of the foraged, wild, and locally grown food he serves at
Raymonds. “To be able to serve moose in a restaurant is pretty much unheard of in the rest of the country.”

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8 Comments

  • There is a lack of international restaurant chains. I don’t understand what the people enjoy here. Every new restaurant that opens seems to fail. The parent company of milestones, Montana’s etc seem to the be only monopoly here.

    Include St John’s to a part of the whole country and not the isolated step child that its known to be. Invite popular chains to open here. Give the ever growing population some choice.

  • Interesting article, for sure. My opinion of the restaurant business is you must be passionate about food or else, for the amount of work that has to go into it, one wouldn’t bother. I am surprised as well, that there was no mention of chain restaurants that have such a buying advantage over small, independent operators. To boot, much of their product is bought in bulk and sometimes from a central location in Ontario or Montreal. And, depending on where you are in the province, they can avail of public money. That adds another dimension to the term “survival”.

  • While most of us understand that because we are on an island and product has to be shipped in, the final cost to the average customer far outways cooking in. As far as seafood as the norm Id much prefer a greater ethnic type of cuisine such as you would find in B.C. Just because Nfld is an island shouldn’t deter average customers in relation to costs of the establishment, but it does. Thanks for reading..

    • Huh? Most restaurants downtown aren’t even seafood focussed. Chinched is all about pork and charcuterie. The Club meat. Magnums a bit of everything. And if it’s ethnic you’re after: International Flavours, India Gate, and Mohamad Ali’s got you covered for every price point. Check them out, I think you’ll enjoy. Cheers.

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