How will the threat of tariffs, changing immigration, and shifting consumer spending affect the foodservice industry this year? Experts are optimistically predicting adding 200,000 new jobs in 2025, with a .8 per cent industry growth in the first quarter of the year, but that growth is expected to slow as the year progresses.
While nine out of 10 adults say they enjoy going to restaurants for a favourite meal that they can’t easily replicate at home, Numerator’s recent webinar ‘Tariffs, Turbulence, and Tight Budgets’ reveals that Canadian consumers were intentional with their spending in 2024 and this trend will continue into 2025. Last year, 51 per cent of Canadian consumers intentionally pulled back on their discretionary spending, a decision driven primarily by inflation and the desire to get more value for their money. This year, 30 per cent plan to cut back even further or maintain their current spending level.
How are Canadians spending the money they are saving? As almost one-third of Canadians are cautious about discretionary spending, many consumers are prioritizing adding to savings and paying down debt as top ways to spend their money.
Perceived value continues to be crucial as consumers decide where to spend their money. Operators will need to be intentional this year in attracting and retaining customers, as research shows that 64 per cent of full-service customers and 47 per cent of limited-service customers say their dining experience is more important than the price of the meal.
In today’s challenging economic times, operators are also faced with uncertainty about the impact of potential tariffs from the United States. While there seems to be a growing “buy Canadian and avoid American” sentiment, 71 per cent of consumers are concerned about possible tariffs. Of those consumers, 69 per cent plan to cut back on spending, and 49 per cent of those spending cuts are expected to include dining out.
RELATED: Restaurants Canada issues statement on U.S. trade tariffs and Canadian retaliatory measures
As the economy remains uncertain and diners are choosing how they spend their dollars carefully, providing a memorable, valuable experience may be the key differentiator in the foodservice industry this year.
