Toronto Star

Restaurant­s feeling the heat of reopening

Eateries forced to increase costs to reopen safely, making diners reluctant to eat out

- MICHAEL LEWIS BUSINESS REPORTER

Most restaurant­s in Canada are losing money even as the economy restarts, while more than a third where dining is now allowed on the premises say reopening has had a negative impact on their businesses, according to a survey by Restaurant­s Canada.

“Restaurant­s are eager to open up the on-premise portion, yet not all restaurant­s have enjoyed a boost in sales,” said James Rilett, the vice-president for central Canada for the national industry associatio­n.

Restaurate­urs face reopening costs amid protocols to control the spread of COVID-19, he noted, including paying for non-medical face makes and other protective equipment, sanitation materials and Plexiglas barriers in some cases. As these costs emerge, a majority of Canadians expressed a reluctance to return to dining out in a recent Angus Reid poll, although 64 per cent said they have ordered food at least every two weeks from a restaurant.

“These are early days,” Rilett said. “After being at home for so long, it will take some guests time to come back out.”

The restaurant associatio­n, which has more than 30,000 members, received 940 completed responses from food service operators representi­ng 14,129 locations for its June 1 to 7 survey, with the data suggesting that full-service restaurant chains are having more success than independen­ts.

For single unit independen­t operators, 52 per cent saw a negative impact in the early days of opening compared with 37 per cent of chain restaurant­s. “It’s possible that the larger chains have the marketing resources to get the word out that they are open, whereas the public may not be fully aware that their local independen­t restaurant is now open,” Rilett said.

The survey results released Thursday show that among respondent­s whose operations are open for takeout or delivery only, or who are offering dine-in services under new restrictio­ns, six out of 10 are operating at a loss. Twenty-two per cent of single-unit operators and 15 per cent of multi-unit operators said they are just breaking even. Among restaurant­s that have reopened their doors for on-premise dining, fewer than half said doing so has had a positive impact.

After months of significan­tly reduced

revenue, or none at all, and now facing months of operating at reduced capacity, many restaurant­s need continued federal government support, said Shanna Munro, Restaurant­s Canada president and CEO.

“Our industry wants to contribute to rebuilding the economy and reviving neighbourh­oods, but time is running out. Most restaurant­s have been accumulati­ng debt for three months already. If they don’t get the help they need to return to positive cash flow, many won’t be able to last much longer.”

Restaurant­s Canada is calling for the federal government’s 75 per cent wage subsidy to continue until food service operations are generating enough revenue to survive without support, and for it to be reduced gradually rather than end at an arbitrary date. It also wants more flexibilit­y in the assistance threshold of 30 per cent revenue decline and for Ottawa to work with the provinces to help ensure a moratorium on commercial evictions in every jurisdicti­on.

 ?? JONATHAN HAYWARD THE CANADIAN PRESS FILE PHOTO ?? Diners enjoy a restaurant patio in Vancouver last month. A Restaurant­s Canada survey has found that most restaurant­s in Canada are losing money even as the economy restarts.
JONATHAN HAYWARD THE CANADIAN PRESS FILE PHOTO Diners enjoy a restaurant patio in Vancouver last month. A Restaurant­s Canada survey has found that most restaurant­s in Canada are losing money even as the economy restarts.

Newspapers in English

Newspapers from Canada