The restaurant industry is facing a bleak outlook

"The Canadian restaurant industry, despite surviving the widespread impacts of COVID-19 throughout its lifespan, remains in a dire situation, with many businesses at risk of collapse. This is the main point of a recent report on Canadian restaurants, which indicates that despite enduring the depths of the pandemic, the overall outlook for the industry appears bleak.
The total expenses of restaurants this year have exceeded $110 billion, which is a 10% increase compared to the previous year. However, expenses have surged even further, pushing many towards the brink of bankruptcy.
Restaurants in Quebec are refraining from using rival payment machines due to hefty fines. This group claims that over half of its members are operating at a loss this year. While in an industry known for slim profit margins, it is not uncommon, in 2019, only about 12% of the group's members were at risk. Richard Alexander, the group's executive vice-president, said in an interview, "This is very challenging because everything it takes to open a restaurant has gone up by two digits. For the first five months of 2023, bankruptcies in this sector have increased by about 50% compared to the same period last year, and he says even more than that is on the way. This is a truly critical time."
Rising Costs
Frederick Demanche, the director of the Ted Rogers School of Hospitality and Tourism Management at Ryerson University, is not surprised to hear that more restaurants are struggling. The restaurant industry may have been hit harder than others by the COVID-19 pandemic, as it is an experiential business. With the increase in gratuity amounts, many Canadians prefer to forego tipping, and some restaurants agree. Government programs designed to support employment and pay rent helped but have now expired, and the demand for dining out has returned to pre-pandemic levels. In any case, it is decreasing: OpenTable data, a restaurant reservation system, shows that across Canada, demand has decreased by about three percent this month, and in some cities, it is even worse. In Edmonton, demand has decreased since April, while in Toronto, it has declined for five consecutive months."

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