Restaurants Canada – which is seeking government assistance for troubled restaurants – says it recently conducted an investigation that highlights the dangers facing the industry.
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If no improvement is seen in the next three months, one in two restaurants that responded to the survey said they expect failure, and “most” businesses with multiple locations say they will have to close a restaurant at least.
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“Over the past month, we have heard so many stories from these small independent restaurateurs who, on a daily basis, find it difficult to decide whether to close permanently or not,” Mark von Schellwitz, vice-president of Restaurants Canada for the western region said the John Oakley Show on Global News Radio.
Seventy-five percent of restaurants responding to the survey are “very or extremely concerned” about the level of debt.
The group welcomes plans to alleviate commercial rents, a federal measure that is being worked out in consultation with the provinces, although details are yet to be released.
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Restaurants Canada is calling for a moratorium on evictions and lockouts in restaurants. They also argue that rent assistance levels should be linked to declining income percentages, and that these supports should be maintained as the economy recovers.
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“What we hear is … we recognize and we certainly appreciate all the deferrals and loans that are available to us in the short term, but in the long term this will only contribute to more permanent closings as this insurmountable debt continues to go up, “said von Schellwitz.
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Many restaurants across Canada closed completely during the pandemic, while others operate on a delivery and takeout basis but do not have comparable incomes.
Restaurants Canada has said that 800,000 people have already lost their jobs and that restaurant sales for the second quarter of 2020 are expected to decrease by $ 20 billion.
The federal government has already announced an emergency wage subsidy of up to 75 percent for employers. It also supports interest-free bank loans of up to $ 40,000 to help businesses overcome the pandemic.
Restaurants Canada said its investigation was conducted between April 15 and April 21. The results are based on 914 completed surveys, which the organization says represent a total of 11,856 restaurants across Canada, as many of the respondents have multiple locations.
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