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Canadian Restaurants Face Tough Times as Diners Cut Back
Canada’s restaurant industry is feeling the squeeze as more consumers cut back on dining out amid rising living costs. A new report from Restaurants Canada reveals that three in four Canadians are eating out less often, with the number climbing to 81% among those aged 18 to 34.
The shift is driven largely by affordability concerns. Diners are seeking more value for their money, often turning to quick-service restaurants or choosing breakfast menus over pricier dinner options. At the same time, operators are grappling with soaring expenses: food, labour, and insurance costs have all risen by double digits.
The report highlights that as of June 2025, 41% of restaurants were either breaking even or operating at a loss. To cope, many businesses are raising menu prices, reducing staff, adjusting hours, or streamlining offerings.
Kelly Higginson, CEO of Restaurants Canada, called the trend “alarming,” warning that without relief, many establishments may struggle to survive.
Despite the challenges, the industry is adapting. Some restaurants are leaning into digital deals, loyalty programs, and lower-cost menu innovations to keep customers coming through the door.
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