No treats here: October stats reveal declining sales growth

Published January 16, 2019

Canada’s commercial foodservice industry decelerated for the second straight month in October 2018 due to a moderation in full-service restaurant sales growth. Total commercial foodservice sales rose by 3.7 per cent in October, after averaging 5.2 per cent growth over the previous nine months. Taking into account menu inflation of 4.2 per cent, real sales growth dipped by 0.4 per cent in October.

Caterers and quick-service restaurants led the industry in October with year-over-year nominal growth of 5.6 per cent and 5.2 per cent, respectively. These gains are on par with recent gains for both segments. In contrast, sales at full-service restaurants rose by a tepid 2.2 per cent in October. The slowdown in October 2018 reflects a moderation in consumer spending, compared to a 7.5 per cent surge in sales in October 2017.

In fact, many provinces reported a moderation in spending in October 2018 compared to October 2017, although some provinces were impacted more than others. Prince Edward Island, Nova Scotia, British Columbia and Quebec continued to report solid gains in October. In contrast, Ontario’s foodservice sales decelerated to 3.1 per cent growth, after averaging 6.0 per cent growth in the previous nine months. While caterers and quick-service restaurants in Ontario reported higher sales, full-service restaurant sales rose by a tepid 1.1 per cent.

The slowdown in foodservice spending in October 2018 was not surprising, given the several previous years of robust growth. Foodservice spending will likely continue to moderate in 2019 due to softening consumer confidence, high household debt and recent equity market volatility. Members of Restaurants Canada can learn more about what to expect in 2019 and the next few years ahead in the Foodservice Industry Forecast for 2018-2022. Click here for access to the report.

The Foodservice Industry Forecast is one of many research reports available exclusively to members of Restaurants Canada.

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