Restaurants Canada Chief Executive Kelly Higginson said it is a “alarming” trend for the food service industry. She said that in particular the younger generation is: “To whom we will really focus more and more as they begin to grow in the most important consumer of demography.” The report found younger Canadians higher importance for price, value and convenience compared to older Canadians.
Rising costs and weaker expenses press restaurant profits.
The expenditure for restaurants are delayed compared to pre-pandemic levels. Per Head of the population, Canadians are expected to spend $ 1,035 on full-service restaurants and $ 1,135 in Quick-Service Restaurants this year. In 2019 they spent $ 1,165 and $ 1,150 respectively.
While fewer people have dinner, the sale of alcohol in restaurants are also delayed because of the rising menu prices and a consumer shift to well -being, the report showed. Forty -one percent of the Canadians surveyed said that their alcohol consumption has decreased in the past year.
“Because our operators see less or not see alcohol, it makes it even more challenging to be able to concentrate on the value of Canadians now, and can also have some profit at the end of the day,” Higginson said.
The sale in the Foodservice industry is expected to reach $ 124 billion this year. However, when adapted for inflation, growth remains relatively muted.
As consumers return to expenditure, companies also have to deal with increasing operational costs. The costs of food, labor, insurance and utilities, including costs, have grown with double digits between 2023 and 2025, according to the report. The report showed that 41% of companies were working with losses or even from June 2025.
“In the last five years our operators have really been put into a pressure cooker of how they can remain viable as a profitable company to keep the doors open and to remain the communities and should serve,” Higginson said.
As population growth slows down, the industry is confronted with a shortage of labor. Higginson said that restaurants in the countryside of rural and remote areas will see the worst effects. She said that key positions, such as a cook or an early morning baker, are more difficult to fill in the countryside, which then influence the restaurant activities.
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Restaurants run to brunch and snacks while dinner asks
Many restaurants try to adapt to the difficult operational environment by changing menus to reduce waste and operate fewer hours on slow days to save costs. Some companies go on their way to a brunch instead of offering dinner services because the demand for breakfast has risen, Higginson said. “Due to the lack of discretionary editions, Canadians increase their expenses on the breakfast segment and less on dinner, which is usually a bit more expensive,” she said.
The sale of lunch hour in Quick-Service Restaurants increased by 7.6% in the first five months of 2025-topping pre-pandemic levels, as a result of the mandate for return-to-office and a shift in value. “That really influences our operators because the dinner used to be a bit more profitable for our operators,” said Higginson. “Now they make less profit from those two segments, breakfast and lunch.”
There is also a shift in the industry to capture the trend of the snacks, especially under Quick-Service restaurants. Supper and evening snack traffic grew 3.4% and 4% respectively. The report found Snacking as a meal replacement the most common with younger generations.
Higginson said that the snack segment is an opportunity for the industry to take advantage. “It’s really time for that soft reboot and a look where we can meet our consumers where they are,” she said.
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