The one-two punch of a sharp drop in same-store sales and skyrocketing debt may force one out of every two independent restaurants to permanently close in the next three months if current conditions continue. These sobering results are based on Restaurants Canada’s most recent survey, conducted between April 15 and April 21, 2020. Restaurants Canada received a total of 914 completed surveys from foodservice operators across Canada, representing 11,856 locations.
Same-store sales at single-unit operators plummeted by an average of 81.3% in the first two weeks of April compared to the same period in 2019. This figure includes locations that are were closed down temporarily, in which case, they saw a 100% decline in their sales. By comparison, multi-unit locations saw an average decrease of 73.4%.
Due to social distancing measures, nearly half of single-unit restaurant businesses have temporarily closed down all operations. Another 38% have closed down their dine-in operations, but are open for take-out and delivery. It’s important to note, that even those restaurants that were open for takeout and delivery reported a 68% drop in their same-store sales.
Sadly, 8% of these respondents to our survey have closed down permanently.
In the vast majority of cases, multi-unit operators kept many of their locations open, while closing their other locations — either temporarily or permanently. On average, seven in 10 of all chain locations are still open for takeout and delivery. While 25.5% is temporarily closed.
With little revenue coming in, restaurants are still faced with paying rent, vendors and business taxes. As a result, three-quarters of respondents said they are very or extremely concerned about their current debt.
Learn more about the relief efforts that Restaurants Canada has made to date here.