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Restaurant Outlook Survey takes a forward view
By Chris Elliott, CRFA Senior Economist
October 17, 2011
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 With 18 million customers every day, the restaurant industry has its finger on the pulse of the economy. Few industries have such frequent and direct contact with so many Canadians. CRFA is harnessing this power with the first-ever Restaurant Outlook Survey. This quarterly survey, based on your responses, will provide a new, forward-looking perspective on business conditions for our industry.
The first results, for Q2 2011, give us a snapshot of how the industry is faring and expectations for the rest of 2011. As we collect more data, we’ll create an index of restaurant industry confidence, and track key issues impacting your business. Not only will this be a benchmark and business tool for CRFA members, it will become an important information source for policy-makers in Ottawa and across the country.
Here are the key findings from our inaugural Restaurant Outlook Survey:
Sales are mixed
According to CRFA’s survey, second quarter sales performance was mixed. Thirty-four per cent of respondents reported higher same-store sales than a year earlier, 32 per cent reported flat sales, and 34 per cent reported lower sales. More than half of all restaurateurs expect their sales to continue at the same pace for the next six months, while another 30 per cent predict their sales growth will pick up speed. Only 18 per cent expect sales growth to slow down.
Employment edges up
Restaurant employment shows no sign of dwindling over the remainder of 2011. More than 60 per cent of operators plan to maintain employment levels while 22 per cent intend to hire more staff.
Restaurant employment shows no sign of dwindling over the remainder of 2011. More than 60 per cent of operators plan to maintain employment levels while 22 per cent intend to hire more staff.
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Obstacles ahead
Rising food costs top the list of industry challenges – nearly three-quarters of operators had to stomach higher food costs in the second quarter of 2011 compared to a year earlier. Although 58 per cent of operators expect to raise menu prices as a result, a solid 41 per cent plan to hold prices steady over the next six months.
Food costs are not the only challenge facing restaurateurs. While rising labour costs are impacting two-thirds of operators, one in four restaurateurs is having difficulty finding qualified workers – a trend evident in Western and Central Canada. Operators also have to accommodate a decline in tourists, British Columbia’s HST and everyday issues of government red tape.
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Looking forward
Despite these challenges, operators remain relatively optimistic. As evidenced by sales and employment expectations in CRFA’s survey, restaurateurs are a resilient – and hopeful – bunch.
Highlights from CRFA’s Restaurant Outlook Survey
In the second quarter of 2011:
- the average restaurant posted flat sales;
- 82 per cent of restaurateurs expect sales to continue growing at the same or greater pace for the rest of the year;
- 83 per cent will maintain employment levels or add new staff over the rest of the year
- nearly a third of operators blamed bad weather for negatively affecting sales; and
- close to 60 per cent of respondents with B.C. operations noted the HST was hurting sales.
Note: The Restaurant Outlook Survey was conducted in May, June and July 2011. In total, 427 completed surveys were submitted, representing 4,826 establishments across Canada. Survey results are considered accurate within +/- 4.7 percentage points 19 times out of 20.
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