Summer of 2020 has seen a patio season like no other.
Restaurateurs across Canada moved quickly early in the season to create or expand outdoor dining sections, giving themselves more physically distanced capacity, and COVID-cautious customers the confidence to dine out in fresh air.
But as the lazy, hazy days of summer draw to a close, fear of failure is surging.
“My wife and I both operate the business, and we aren’t really sleeping too well,” said Matthew Senecal-Junkeer, owner of The Birds & The Beets in Vancouver’s Gastown neighbourhood. The restaurant typically only has four to six outdoor seats, but this year the city allowed the couple to transform four parking spaces into a 50-seat patio.
“We were hitting capacity, we had every table virtually filled in our restaurant,” said Senecal-Junkeer. “We just had a little preview of what winter could be like when we had a three-day rainy streak in Vancouver, and it meant about a 42 per cent decline from what our sales were the week prior.”
Survival at stake
In Windsor, Ont., John McKibbon is also worried.
“I’d be lying if I said we don’t have anxiety going into the fall and winter,” said McKibbon, who co-owns the Sandbar Waterfront Grill as well as John Max Sports & Wings.
“We’ve had people come to the restaurant wanting to sit outside, and when we’ve been full outside and only had tables indoors, some of those customers have decided not to dine with us that day,” he said.
McKibbon and his partners transformed an outdoor volleyball court at one of their two sports bars into a physically distanced patio on the sand.
A volleyball court at John Max Sports & Wings in Windsor has been converted for patio dining. (Submitted by John McKibbon)
“We think the loss of the patios will have a pretty dramatic effect on our sales,” he said. “There are different levels of anxiety with everyone.”
Canada’s food service sector typically employs 1.2 million people, and prior to the pandemic, served 22 million meals a day across the country, according to industry data.
Statistics Canada recently released the results of a May survey on business conditions. The Canadian Chamber of Commerce crunched the numbers with a focus on restaurant operators, and concluded that 60 percent of participants don’t expect to survive more than three months with the current physical distance restrictions in place.
Already a significant number of restaurants across Canada have closed permanently.
Chamber president and CEO Perrin Beatty urged Canadians to take political action to encourage further financial support of the industry. “Everyone also needs to remind their elected representatives of the importance of our restaurants in our lives,” said Beatty in a press release.
‘We’re not health experts’
The Chamber has teamed up with 60 of the best-known restaurant brands in Canada, along with other hospitality organizations, to launch a campaign called Our Restaurants. It’s also produced an ad promoting the industry on social media platforms.
But the industry’s own association, Restaurants Canada, is hesitant to push too hard to relax seating requirements, especially as a second wave of the virus begins to build.
“We’re not health experts,” said Mark von Schellwitz, Restaurant Canada’s vice-president for western Canada. “But a number of members have approached us to point out that the World Health Organization guidelines for physical distancing is one meter, not two meters. Ifwe had a one meter distance instead of two that obviously would increase our capacity, and that would be really helpful.”
Von Schellwitz is part of a hospitality industry group that is lobbying the federal government to launch a national campaign to boost consumer confidence in dining out. He pointed to a program in the United Kingdom called “Eat Out to Help Out,” where dine-in customers could receive a 50 per cent discount on their meals throughout the month of August, up to £10 (about $17) per person.
The program ended up costing the government more than expected, as millions of Britons jumped at the incentive, running up a tab of £522 million ($900 million).
Matthew Senecal-Junkeer of The Birds & The Beets restaurant in Vancouver. (Submitted by Matthew Senecal-Junkeer)
But in Vancouver, Matthew Senecal-Junkeer is counting on one thing: his landlord.
“They are asking for full rent now,” he said. “And we’ve had the wage subsidy and we had the patio, so we were able and willing to pay it. But I indicated to them yesterday that look, come October, it’s not I’m saying I don’t want to pay — it’s just there simply is no cash in the bank.”
Calls for more support
The Canada Emergency Wage Subsidy has helped many restaurateurs, and has been extended until December, but the Canada Emergency Commercial Rent Assistance program expired at the end of August.
Based in Charlottetown, PEI, Kevin and Kathy Murphy own 16 food and beverage operations in three Atlantic provinces, along with the Prince Edward Island Brewing Company. Patios have always been a big part of their business, but they’ve already closed down their Fishbones Oyster Bar & Seafood Grill early for the season, and are thinking hard about others.
During the summer of 2019, the patio at Sims Corner Steakhouse & Oyster Bar was bustling. This summer the pandemic has meant fewer paying customers. (Murphy Hospitality Group)
“Do we need three restaurants in one street?” asked Murphy. “So we’re thinking, do we close one in October or November? And just go with the other two? We’re also looking at days of the week. Do we go to five days a week versus seven days a week?”
PEI has enacted some of Canada’s strictest policies related to the COVID-19 pandemic, allowing restaurants a maximum of 50 patrons at any time, regardless of a venue’s size.
Murphy and other tourism entrepreneurs in the area have banded together to lobby the government for further financial support.
“You do what you have to do to survive and put plans in place to get there,” says Murphy, noting that the industry has always been characterized by resourcefulness and creativity. But he also has a warning for restaurant lovers across the country, about how entrepreneurs have to approach business: “You will not stay open if you’re not making money.”
MONTREAL – Travel company Transat AT Inc. reported a loss in its latest quarter compared with a profit a year earlier as its revenue edged lower.
The parent company of Air Transat says it lost $39.9 million or $1.03 per diluted share in its quarter ended July 31.
The result compared with a profit of $57.3 million or $1.49 per diluted share a year earlier.
Revenue in what was the company’s third quarter totalled $736.2 million, down from $746.3 million in the same quarter last year.
On an adjusted basis, Transat says it lost $1.10 per share in its latest quarter compared with an adjusted profit of $1.10 per share a year earlier.
Transat chief executive Annick Guérard says demand for leisure travel remains healthy, as evidenced by higher traffic, but consumers are increasingly price conscious given the current economic uncertainty.
This report by The Canadian Press was first published Sept. 12, 2024.
Dollarama Inc.’s food aisles may have expanded far beyond sweet treats or piles of gum by the checkout counter in recent years, but its chief executive maintains his company is “not in the grocery business,” even if it’s keeping an eye on the sector.
“It’s just one small part of our store,” Neil Rossy told analysts on a Wednesday call, where he was questioned about the company’s food merchandise and rivals playing in the same space.
“We will keep an eye on all retailers — like all retailers keep an eye on us — to make sure that we’re competitive and we understand what’s out there.”
Over the last decade and as consumers have more recently sought deals, Dollarama’s food merchandise has expanded to include bread and pantry staples like cereal, rice and pasta sold at prices on par or below supermarkets.
However, the competition in the discount segment of the market Dollarama operates in intensified recently when the country’s biggest grocery chain began piloting a new ultra-discount store.
The No Name stores being tested by Loblaw Cos. Ltd. in Windsor, St. Catharines and Brockville, Ont., are billed as 20 per cent cheaper than discount retail competitors including No Frills. The grocery giant is able to offer such cost savings by relying on a smaller store footprint, fewer chilled products and a hearty range of No Name merchandise.
Though Rossy brushed off notions that his company is a supermarket challenger, grocers aren’t off his radar.
“All retailers in Canada are realistic about the fact that everyone is everyone’s competition on any given item or category,” he said.
Rossy declined to reveal how much of the chain’s sales would overlap with Loblaw or the food category, arguing the vast variety of items Dollarama sells is its strength rather than its grocery products alone.
“What makes Dollarama Dollarama is a very wide assortment of different departments that somewhat represent the old five-and-dime local convenience store,” he said.
The breadth of Dollarama’s offerings helped carry the company to a second-quarter profit of $285.9 million, up from $245.8 million in the same quarter last year as its sales rose 7.4 per cent.
The retailer said Wednesday the profit amounted to $1.02 per diluted share for the 13-week period ended July 28, up from 86 cents per diluted share a year earlier.
The period the quarter covers includes the start of summer, when Rossy said the weather was “terrible.”
“The weather got slightly better towards the end of the summer and our sales certainly increased, but not enough to make up for the season’s horrible start,” he said.
Sales totalled $1.56 billion for the quarter, up from $1.46 billion in the same quarter last year.
Comparable store sales, a key metric for retailers, increased 4.7 per cent, while the average transaction was down2.2 per cent and traffic was up seven per cent, RBC analyst Irene Nattel pointed out.
She told investors in a note that the numbers reflect “solid demand as cautious consumers focus on core consumables and everyday essentials.”
Analysts have attributed such behaviour to interest rates that have been slow to drop and high prices of key consumer goods, which are weighing on household budgets.
To cope, many Canadians have spent more time seeking deals, trading down to more affordable brands and forgoing small luxuries they would treat themselves to in better economic times.
“When people feel squeezed, they tend to shy away from discretionary, focus on the basics,” Rossy said. “When people are feeling good about their wallet, they tend to be more lax about the basics and more willing to spend on discretionary.”
The current economic situation has drawn in not just the average Canadian looking to save a buck or two, but also wealthier consumers.
“When the entire economy is feeling slightly squeezed, we get more consumers who might not have to or want to shop at a Dollarama generally or who enjoy shopping at a Dollarama but have the luxury of not having to worry about the price in some other store that they happen to be standing in that has those goods,” Rossy said.
“Well, when times are tougher, they’ll consider the extra five minutes to go to the store next door.”
This report by The Canadian Press was first published Sept. 11, 2024.
TORONTO – The U.S. Consumer Financial Protection Bureau has ordered TD Bank Group to pay US$28 million for repeatedly sharing inaccurate, negative information about its customers to consumer reporting companies.
The agency says TD has to pay US$7.76 million in total to tens of thousands of victims of its illegal actions, along with a US$20 million civil penalty.
It says TD shared information that contained systemic errors about credit card and bank deposit accounts to consumer reporting companies, which can include credit reports as well as screening reports for tenants and employees and other background checks.
CFPB director Rohit Chopra says in a statement that TD threatened the consumer reports of customers with fraudulent information then “barely lifted a finger to fix it,” and that regulators will need to “focus major attention” on TD Bank to change its course.
TD says in a statement it self-identified these issues and proactively worked to improve its practices, and that it is committed to delivering on its responsibilities to its customers.
The bank also faces scrutiny in the U.S. over its anti-money laundering program where it expects to pay more than US$3 billion in monetary penalties to resolve.
This report by The Canadian Press was first published Sept. 11, 2024.
