With an impending economic slowdown in 2023, many foodservice operators will continue to face a number of financial challenges in the year ahead. Based on a survey of Restaurants Canada’s members, 75% of table-service restaurants were still in debt in September 2022 as a result of the COVID-19 crisis. Of those still in debt, 54% of respondents said it would take them at least 18 months to recover from the pandemic debt; and 23% said they won’t be able to recover from their pandemic debt unless conditions change.
All of this comes at a time when Canada’s economy is forecast to slow sharply in 2023. According to Restaurants Canada’s latest projections, annual commercial foodservice sales in Canada are forecast to moderate to 5.8% in 2023 to $87.6 billion. Once adjusted for inflation, however, real sales are forecast to be relatively flat in 2023 compared to 2022. This will mean that real sales will remain 4.4% below pre-pandemic levels.
While Restaurants Canada does not forecast profit margins, an economic downturn comes at a time when the foodservice industry continues to struggle financially. In September 2020, half of all restaurants surveyed were operating at a loss or just breaking even.
For the latest forecast, click here.