Restaurants In Canada Are Under Severe Financial Pressure, Failing To Make Half Of Their Profits.

Canadian restaurants are struggling to make a profit due to rising costs and declining customers. According to the survey, about 44% of restaurants are either operating at a loss or barely covering expenses, raising questions about the future of the industry.
The report surveyed 220 member restaurants in late 2025, and found that 26% of businesses were losing money as of November 2025, while 18% were just breaking even. In comparison, only 12% of restaurants were in such a financial situation in 2019, but there has been some improvement compared to 53% in 2024.
Kelly Higginson, the organization’s president and CEO, warned that this situation could directly affect jobs, shifts and business survival, and that more restaurants are likely to close in the coming days. According to her, the continuous increase in the prices of food, rent, labor and other items is increasing the cost of doing business to an unprecedented extent.
Mike von Massow, a nutritionist and professor at the University of Guelph, says that rising food prices are hitting restaurants hard. On the one hand, business costs are rising, and on the other hand, consumers are eating out less due to expensive groceries, which is further affecting revenue.
Frederic Chartier, owner and chef of Beyond the Gate, said that due to fewer customers, he is having to take on additional responsibilities, even doing things like washing dishes and accounting. To cover expenses, he has also taken on part-time jobs and had to close the restaurant’s lunch and Sunday brunch service. The
report also said that 89 percent of restaurants are concerned about labor costs and 88 percent are concerned about rising food prices. Grocery prices increased by 5 percent year-on-year in December due to inflation, which further pressured the business.

With such limited profits, owners are considering raising menu prices by an average of 4 percent in 2026, but they fear that higher prices could further alienate customers. Instead of raising prices, some businesses are introducing value meals or relatively low-cost options to keep customers interested.

According to past surveys, nearly three-quarters of Canadians are avoiding eating out to cut costs. Experts say that without government relief, the crisis could affect both local economies and jobs, as restaurants play a vital role in communities across the country.