All that glitters is not gold. Canada’s foodservice industry is in uncharted and uncertain waters where a busy restaurant does not imply a healthy bottom line for restaurant owners.
Responding to our latest Restaurant Outlook Survey in July, the vast majority of table-service restaurant operators told us they were either losing money just to keep their doors open, or barely scraping by:
- 31% said were operating at a loss.
- 22% said they were just breaking even.
- 12% said they were making a pre-tax profit of less than 2%
This is typically one of the busiest times of year for our industry. If foodservice operators aren’t making a profit now, things will only get worse for them as we move into the fall and winter months.
Based on a previous survey by Restaurants Canada, 85% of independent table-service restaurants and 83% of quick-service restaurants took on new debt due to COVID-19. For table-service restaurants, 44% had taken on debt between $50,000 and $100,000, 34% had debt greater than $100,000 and 23% had debt of less than $50,000. Given the accumulated debt, and that so many continue to operate at a loss, it is more difficult for businesses to pay back loans.
As one operator summarized about the current foodservice landscape: “It’s not good out there – many will fail over the next year. It feels like we are dealing with the reality of the pandemic now.”
The results for July are based on a survey of 508 respondents representing 11,290 foodservice locations across Canada. The full results of the Q2 2022 Restaurant Outlook Survey report will be available soon on Restaurants Canada’s member portal.
Jess Landesman
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