Sales Continued To Improve For Canadian Restaurants In The Fourth Quarter 2014

Nearly 80% of restaurant operators polled for Restaurants Canada’s Restaurant Outlook Survey reported increased or equal same-store sales in the fourth quarter of last year. The percentage reporting lower sales fell to only 23%, the lowest percentage since the survey began in 2011. But operators are less optimistic about sales trends during the next six months. Only 28% expect same-store sales to improve over the period, down from 36% in Q3 and more than 40% Q1/14. The percentage forecasting lower sales rose to 18%.

Restaurants Canada Senior Economist Chris Elliott cited “steady improvement in economic activity, a lower unemployment rate and rising consumer confidence” as factors behind the fourth-quarter gains. He noted that December sales were particularly strong, with half of those surveyed reporting higher same-store sales and only 18% saying sales decreased.

Quick-service operators are the most optimistic about sales trends for the next six months: 36% expect same-store sales to increase while only 11% foresee falling sales. In contrast, only 27% of table-service operators predict same-store sales gains and 24% expect a decrease.

Labor costs supplemented food costs as the biggest challenge Canadian restaurateurs mentioned. Food-cost increases have been decelerating in Canada, as they have in the U.S.

Restaurants Canada, which represents the entire foodservice industry in Canada, earlier forecast 4% current dollar growth of foodservice sales in 2015, in line with the past two years.

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