How to stay on top of your restaurant costs

We just released our 25th anniversary edition of our annual Foodservice Facts report – a staple and a mainstay in our industry. For 25 years, this report has been providing restaurant operators with crucial facts and insight, reporting on the industry’s outlook across the country and guiding decision-makers’ plans for the future. In these past 25 years, Foodservice Facts has featured both booms and busts alongside the rest of Canada’s economy; it has followed restaurant innovation, trends in food and drink consumption and purchasing patterns of eager customers.

As a restaurateur, it’s important to keep tabs on your profit margins and to understand where your money is going – a topic that a few of our blog posts have contended with recently.

According to the Foodservice Facts report and the Restaurants Canada’s Restaurant Outlook Suvey, Q1 2016
 the biggest issues impacting restaurant operators are:


  1. Food costs (76%)
  2. Labour costs (61%)
  3. Weak economy (56%)

Profit Margins


When it comes to profit margins, the average pre-tax profit margin for a restaurant operator is just 4.3% of operating revenue, relatively unchanged from 2012. While food and labour costs are the largest expenses, rental and leasing also account for a significant portion of operating costs.

With average cash now around 10% of revenue, restaurants in Canada’s oil-based economies are well-positioned to weather the downturn as long as they keep their eyes on taking care of their guests.

So how do you stay on top of your costs? Restaurants that are proactive instead of reactive, that focus on what their guests need in order to come more often, that have the presence of mind to wonder how they can better invest their food and labour dollars where they matter most – these are the ones that will be best able to meet these challenges.

To stay ahead of the curve, consider checking out our Foodservice Facts report! It’s full of helpful material and will help you learn what’s important about the industry and how to find success!



Content Marketing Specialist at Restaurants Canada. For inquiries or guest submissions, contact