Foodservice Outlook Stabilizes—but Cost Pressures Still Bite
- ClearView Insider
- Aug 7
- 2 min read
Canada’s foodservice sector is showing signs of cautious improvement, according to the Restaurants Canada Q2 2025 Outlook. After a turbulent Q1 driven by tariff anxieties and rising costs, commercial foodservice sales are now projected to reach $98.5–$99.5 billion in 2025, a modest upgrade from last quarter—but still trailing pre-tariff forecasts.
Despite a 6.6% growth in sales during the first four months of 2025, operators remain wary. 48% expect to be less profitable than in 2024, and 7 in 10 rate current economic conditions as only “fair” or worse. While consumer confidence is improving, sustained pressures from food costs (83%), labour costs (80%), and macro uncertainty (55%) continue to limit recovery.
Menu price hikes (85%), staff reductions (60%), and ingredient changes (53%) are among top strategies being used to offset costs. Yet 41% of restaurants are still operating at a loss or break-even, a figure far below pre-pandemic norms.
Restaurants Canada is urging the federal government to permanently exempt all food—including restaurant meals—from GST/HST as a relief measure.
In May, StatCan reported total sector sales reached $8.5 billion, with full-service restaurants (+1.2%) and special food services (+3.1%) leading the gains. However, limited-service restaurants declined 0.8%, and provincial trends were uneven—Quebec and Ontario posted growth, while BC and Saskatchewan slipped.
For food-focused landlords and retail developers, the message is clear: expect gradual recovery with sector-specific volatility—and prioritize operators with resilient business models and pricing flexibility.
Source: Retail Insider, “Foodservice outlook improves slightly in Q2, but remains fragile amid trade tensions and cost volatility: Restaurants Canada,” July 30, 2025. https://retail-insider.com/retail-insider/2025/07/foodservice-outlook-improves-slightly-in-q2-but-remains-fragile-amid-trade-tensions-and-cost-volatility-restaurants-canada/
Connect with ClearView: Wondering how Q3 foodservice trends could shape tenant stability, lease structuring, or retail repositioning? Let’s talk: info@cvpartners.ca