Restaurants enrich communities and society, but now – more than ever – they need support

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Q & A with Todd Barclay, President and CEO, Restaurants Canada

What’s the outlook for restaurants for the beginning of 2022?

The past 20 months have been extremely challenging for our foodservice industry, with most restaurants coping with significant losses and having to take on debt to stay open.

While restaurateurs did their best to navigate these challenges, I’m even more worried about the next five months.

In light of new, heightened restrictions in place in markets across Canada, customer numbers continue to plummet compared to pre-pandemic levels. I believe that if restaurants can make it to the spring – and to the point where people are more comfortable coming back – they will have a better chance to survive. However, without adequate support, I’m deeply concerned that the industry is going to continue to see significant losses and closures.

What kind of support can make a difference?

Since the first wave of lockdowns ended last year, eight out of 10 operations have either been consistently losing money or scraping by with a profit margin of 2 per cent or less. Our data shows that 90 per cent of foodservice businesses have relied on federal rent and wage subsidies to help them survive the pandemic. However, changes in federal policies and new programs now make access much more restrictive, and only 20 per cent of these businesses qualify for the new Tourism and Hospitality Recovery Program.

Only restaurants showing a loss of 40 per cent of revenues are eligible for support, which is unrealistic since restaurants are already struggling at minus 30 or 35 per cent. What businesses can even survive on a 30 per cent loss, let alone a 40 per cent loss? As we move into what is typically the toughest time of the year for restaurants, we believe that these programs need to be broadened and become less restrictive to allow restaurants to stay open and keep people employed.

Why is it important to continue supporting restaurants?

There are 1.2 million people employed in the foodservice industry, which is made up of over 90,000 businesses. The restaurant and hospitality industry offers employment and career opportunities for Canadians from all walks of life, including immigrants, women and students.

While these businesses are experiencing difficulties due to circumstances that are completely beyond their control, many feel we are getting close to the finish line. So it doesn’t make sense to pull the rug out from under the people we’ve already successfully supported for such a significant period of time.

So we’re asking the government to provide support that will allow them to survive as well as continue to help with messaging around the health and safety of the industry. For example, some provincial governments have acknowledged the benefits of congregating in restaurants since they have all the right safety measurements and protocols in place.

Do you feel restaurants have done their part to instill public confidence?

Absolutely. Restaurants have made significant investments to keep people safe, including guests, employees and community members. They have been willing to support the public health measures that allowed them to stay open – including checking the vaccination status of guests – and they have done all this without compensation.

This means they require additional personnel to manage these programs at a time when their business is down, when they have taken on more debt and when they are affected by inflation and rising costs.

What else should Canadians keep in mind?

This is an industry worth investing in: 95 cents of every dollar spent at a restaurant goes back out into the community in the form of wages and rent as well as purchased goods and services from various contractors. Restaurants are also known to be strong supporters of charities and other community initiatives.

As key contributors to the social fabric of local communities, restaurants can be powerful drivers of economic recovery. But first, they need to survive.

CATALYZING REVIVAL

From May 9 to 11, Restaurants Canada will be hosting the RC Show 2022, Canada’s leading foodservice and hospitality trade show. RC Show 2022 will reunite the industry and prepare businesses for their revival through a dynamic hybrid event. This action-packed, three-day event provides access to the industry’s top brands and suppliers as well as national and global thought leaders who will address key issues, all in support of reviving of the industry. For more information, visit www.rcshow.com, or follow the conversation on social: #RCShow #RestaurantsAreFamily @RestaurantsCanada.