Canadian restaurants struggle to survive despite gradual reopening


For a man with three closed restaurants, John Sinopoli is a busy guy. Sinopoli is one of the owners of the Ascari Hospitality Group in Toronto, which runs the popular restaurant Ascari Enoteca, as well as two other businesses: a bar and a restaurant business.

These days, he makes meal kits, delivers high-end grocery boxes and lobbies for an industry he says is on the verge of losing many of its independent operators.

In early April, 10% of restaurants in Canada had closed permanently due to the COVID-19 pandemic, according to the Restaurants Canada industry group.

Many more could follow suit, Sinopoli said – at least half of the country’s independent restaurants.

His opinion was echoed in a voluntary survey released in late April by Restaurants Canada, where 50% of independent restaurants said they would close permanently within three months under current conditions.

Sinopoli is one of the forces behind the recently created lobby group. Its aim is to draw the attention of the government to what is going on in small restaurants owned by families or chefs.

Job losses

The group is claiming repayable loans of up to billions of dollars, or about 10% of a company’s annual sales compared to last year.

The group is also calling for regulatory changes such as lowering taxes on alcoholic spirits purchased by retailers and forcing credit card companies to lower interest rates on accounts held by hotel businesses.

“Why is the restaurant and hotel industry not your number one concern given the massive amount of job losses,” said Sinopoli.

This is also what Vancouver chef Robert Belcham thinks. Two of its restaurants and a bar are currently closed due to the pandemic. This gives Belcham a lot of time to think.

Chef Robert Belcham has two restaurants and a bar in Vancouver, all closed due to the coronavirus pandemic. (Julianne Bell / Submitted by Robert Belcham)

“The state of my industry is completely … shattered,” said Belcham, who added that the business model for small restaurants was precarious in North America before the coronavirus hit.

“We painted ourselves in a push down corner. “

Belcham said independent restaurateurs like him were in a “race to the bottom” before the pandemic, understating each other, lowering menu prices for customer loyalty while costs continued to rise.

Profits have become slim – 5% on average, he told CBC Radio’s. Cost of life.

Then the pandemic struck.

Difficult to make profit under restrictions

In Alberta, the provincial government has given the green light to restaurants to start reopening this week at 50% of their capacity. Some other provinces have reported that they will follow suit.

But for owners like Belcham, it was difficult enough to make a profit when his restaurant was full. Belcham said it would cost $ 60,000 just to reopen his Campagnolo restaurant, and he won’t do it until he can fill the space.

In addition, Belcham said it was not sure that its former customers would return.

“Would you feel safe sitting in a room with strangers, served by someone wearing a mask? I’m not sure you would. “

Belcham said if he had to spend money on rehiring staff, storing his kitchen and adjusting to the rules of physical distancing – then a second wave of infections struck, he would never survive.

Grants available

There is money available to those in the hospitality industry hard hit by the pandemic, thanks to measures implemented by the federal government that largely target many sectors of the economy.

Restaurant owners and laid-off workers may be eligible for Canada’s Federal Emergency Response Assistance Program (CERB).

There is also Canada’s Emergency Wage Subsidy, or CEWS program, for restaurants that continue to operate.

In addition, many restaurants may be eligible for small business loans of $ 40,000, 25% of which could be canceled if the loan is repaid by the end of 2022.

The federal government also extended its wage subsidy by 75% until the end of August. Businesses that saw their revenues drop 15% in March or 30% in April and May are eligible for the program, although Prime Minister Justin Trudeau hinted that changes could happen at this threshold at a conference. press friday.

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Restaurant owners, however, say their fixed costs like rent are unmanageable.

Landlords can apply to access the federal rent relief program, but it is not mandatory and has been criticized as the program may be too complicated. John Sinopoli told CBC Radio’s Cost of life he stopped paying rent; if his owners come to demand payment, he said he’s done.

Pressure groups such as the Canadian Federation of Independent Business have called for federal programs to address these concerns to be expanded at all levels.

Restaurant closings have a wider impact

If independent restaurants do not reopen, the ripple effects will extend beyond the doors of the business and into the community at large.

Peter Oliver is president of Calgary’s hip Beltline Neighborhood Association, home to some of the city’s most popular chain restaurants.

Peter Oliver leads the Calgary Beltline Urban Murals tour. Oliver is President of the Beltline Neighborhoods Association. (Submitted by Peter Oliver, Credit: Beltline Urban Murals Project)

“Many of the people who work in these companies live in the area,” said Oliver. “Most people who have chosen to live here do so because of these businesses. They are an integral part. You probably live in a condo or apartment and you spend a lot of time in cafes or restaurants. impact on the lifestyle here and the feeling of the neighborhood. ”

Written and produced by Falice Chin, with files from Judy Aldous, James Dunne and the CBC Parliamentary Office.

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