Toronto, Nov. 03, 2025 (GLOBE NEWSWIRE) -- Despite expectations of a difficult year, the foodservice industry outperformed early forecasts, thanks to strong domestic tourism and the GST/HST holiday at the start of the year, according to Restaurants Canada’s Q3 Quarterly Report. Commercial foodservice revenue was up 6.9% in the first seven months of 2025, but after adjusting for inflation, Restaurants Canada expects real commercial foodservice sales to grow by 2.1% in 2025 and decline by 0.7% in 2026.
Quarterly Report at a glance:
- Commercial foodservice sales are expected to grow by 5.4% in 2025 before adjusting for inflation, outperforming the previous quarter’s forecast (of 2.7% to 3.7% growth).
- Canada’s restaurant industry continues to prove it is a job powerhouse, adding 23,600 jobs in the first nine months of 2025, more than the 21,200 jobs created across the broader private sector.
- 74% of Canadians say they are cutting discretionary spending because of cost-of-living increases, with eating out (56%) and take-out or delivery (50%) being the most common types of expenses they are cutting.
- Foodservice businesses continue to face significant operating cost increases that challenge their profitability. Over the past two years, insurance costs have increased 14%, food costs 13% and labour costs 11%.
- Commercial foodservice sales are projected to decelerate to 1.6% growth in Q2 2026. Growth is expected to gradually recover thereafter, plateauing at an average of 3.6% in 2027, indicating a return to more sustainable, pre-pandemic trends.
- While technology could help foodservice businesses improve productivity and streamline operations, many remain cautious. The top barriers to adoption are high upfront costs (51%), uncertainty about return on investment (43%), and concerns about long-term stability in the business environment (35%).
- Operators are looking for tools that demonstrate immediate value by helping reduce costs, strengthen operations, or simplify decision-making without placing additional strain on cash flow.
“There is reason for cautious optimism in the foodservice industry after some very challenging years, but we have to keep the ongoing inflationary pressures in perspective,” said Kelly Higginson, President and CEO of Restaurants Canada. “Operating costs continue to rise while consumers are pulling back on discretionary spending, conditions which make investment in technology and growth plans risky. The federal government needs to deliver on its promise to improve affordability for Canadians in its budget tomorrow.”
Restaurants Canada is urging the federal government to permanently exempt all food, including restaurant meals, from GST/HST, to reduce the cost of living for Canadians and support growth in the foodservice industry. To sign Restaurants Canada’s petition calling on government to exempt all food from sales tax, visit .
