A recent study reveals that Canadian restaurants are facing challenges as diners opt for fewer dining-out experiences, while escalating operational expenses put a strain on profit margins.
According to Mark von Schellwitz, Restaurants Canada’s Vice President for Western Canada, a significant 75% of Canadians are cutting back on dining out, with the figure rising to 81% among individuals under 25 years old. This shift in behavior is impacting the frequency of restaurant visits.
The study indicates that over 40% of restaurants are either operating at a financial loss or merely breaking even as of June 2025. Additionally, there has been a notable 41% decrease in alcohol orders at restaurants, raising concerns within the industry.
Restaurants are grappling with the need to adjust their strategies to cope with rising operational costs. Measures such as price increases, staff reductions, menu alterations, and revised operating hours are being implemented to navigate these challenges.
Conversations on the street reflect a trend of individuals curbing their dining-out habits due to the high cost of living, opting to save money by eating at home.
Despite these challenges, there are some positive trends noted in the report, such as an approximately 8% rise in lunchtime foot traffic and an uptick in domestic tourism, which could translate to increased dinner reservations.
In efforts to attract more patrons, restaurant managers like Diana Navarro from Sabina Mexican Food in downtown Vancouver are devising creative strategies. This includes offering student discounts, hosting themed events like karaoke nights, and featuring discounted “happy hour” menus during slower periods to entice customers, particularly office workers in the vicinity.