Restaurants need help

Even before COVID-19, the restaurant business was a tough one to be in.

A barometer of good economic times and bad, restaurants are often the first to feel the pinch of people cutting discretionary spending.

Always competitive, often fickle, and sometimes heartbreaking, the restaurant business is full of entrepreneurs, the kind of people willing to risk their own time and money on a dream.

And it’s always been unforgiving, pandemic or not.

Profits were already sliding before the pandemic because of rising costs: in 2019, Statistics Canada had this to say about the restaurant sector as a whole: “As a result of rising costs, the operating profit margin for the (food services and drinking places) subsector fell from 4.2 per cent in 2018 to 3.8 per cent in 2019. This was the lowest operating profit margin since 2005 and the largest annual decline in the operating profit margin since 2003.”

Then came COVID-19 to take a massive bite out of the industry’s sales numbers.

Here’s Statistics Canada again: “In 2020, the food services and drinking places subsector was directly affected by government interventions related to the COVID-19 pandemic. All provinces restricted access to businesses and implemented business closures throughout the subsector. … According to the Monthly Survey of Food Services and Drinking Places, unadjusted sales for the subsector were down 27.3 per cent throughout the first three quarters of 2020, when compared with the same three quarters in the previous year.”

And those shrinking revenue numbers have had a devastating effect: industry group Restaurants Canada said in December that 10,000 Canadian restaurants had closed their doors since the beginning of the pandemic last March. A survey by the group found that 50 per cent of its members said they expected to close permanently if the economics of the industry don’t improve.

Many costs continue: loans for kitchen equipment and fixtures have to be paid, rent doesn’t magically disappear, and many restaurants are still struggling with outstanding debt from the costs of sudden COVID-related shutdowns.

Thin margins have meant that restaurants already have to be inventive, flexible, creative and quick. And when COVID came, they were all of that.

Many pivoted fast to contactless sales, and moved to restructure indoor and outdoor dining to make it safer, investing scant resources to do so.

It’s pretty clear, though, that moving quickly will only get you so far: to absolutely butcher a phrase, you can lead a horse to water, but you can’t make them order off the menu.

If there’s somewhere you like to eat, find a way to patronize it now. It’s almost guaranteed that your local restaurant is trying to find a way to serve you.

If you don’t, when the pandemic finally lifts, your favourite place just might not be around any more.